UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant? Registrant ☒

Filed by a Party other than the Registrant? Registrant ☐

Check the appropriate box:

GENPREX, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, If Other Thanif other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

If you are a stockholder of record and do not vote by completingany other matter is presented at the annual meeting, your proxy card, by telephone, through the internet or in person at the Annual Meeting, your shares will not be voted.

If you return a signed and dated proxy card or otherwise vote without marking voting selections,provides that your shares will be voted as applicable, “For” the Nasdaq 20% Issuance Proposal, “For” the election of David E. Friedman as the Class I director and “For” the ratification of the selection by the Audit Committeeproxy holder listed in the proxy in accordance with his best judgment. At the time this proxy statement was first made available, we knew of our Board of Directors of Daszkal Bolton LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2018.  If any other matter is properly presentedno matters that needed to be acted on at the annual meeting, your proxyholder (one of the individuals named on yourother than those discussed in this proxy card) will vote your shares using his or her best judgment.statement.

If

May I am a beneficial owner of shares held in street name and I do not provide my brokerChange or bank with voting instructions, what happens?Revoke My Proxy?

If you are a beneficial owner and do not instructgive us your brokerage firm, bank, dealerproxy, you may change or other agent how to vote your shares, the question of whether your broker or nominee will still be able to vote your shares depends on whether the particular proposal is considered to be a “routine” matter under applicable rules. Brokers and nominees can use their discretion to vote uninstructed shares with respect to matters that are considered to be routine under applicable rules, but not with respect to non-routine matters. Under applicable rules and interpretations, non-routine matters are matters that may substantially affect the rights or privileges of stockholders, including the Nasdaq 20% Issuance Proposal and elections of directors (even if not contested). Accordingly, without your instructions your broker or nominee may not vote your shares on Proposal 1 or Proposal 2, but may vote your shares on Proposal 3.

If you are a beneficial owner of shares held in street name, in order to ensure your shares are voted in the way you would prefer, you must provide voting instructions to your broker, bank or other agent by the deadline provided in the materials you receive from your broker, bank or other agent.

Who is paying for this proxy solicitation?

The Company will pay for the entire cost of soliciting proxies. In addition to these proxy materials, our directors and employees may also solicit proxies in person, by telephone, or by other means of communication. Directors and employees will not be paid any additional compensation for soliciting proxies. We may also reimburse brokerage firms, banks, dealers or other agents for the cost of forwarding proxy materials to beneficial owners.

What if I Receive More Than One Proxy Card or Voting Instruction Form?

If you hold your shares in multiple accounts or registrations, or in both registered and street name, you will receive a proxy card or voting instructions form for each account. Please sign, date and return all proxy cards you receive from the Company. If you choose to vote by proxy via the telephone or the internet, please vote once for each proxy card you receive. Only your latest dated proxy for each account will be voted.

What if I have questions about my Genprex shares or need to change my mailing address?

You may contact our transfer agent, V Stock Transfer, LLC, by telephone at (855) 9VSTOCK or, or by email at info@vstocktransfer.com if you have questions about your Company shares or need to change your mailing address.

Can I change my vote after submitting my proxy?

Stockholder of Record: Shares Registered in Your Name

Yes. You can revoke your proxyit at any time before the final vote at the Annual Meeting. If you are the record holder of your shares, youannual meeting. You may change or revoke your proxy in any one of the following ways:

Beneficial Owner: Shares RegisteredWhat if I Receive More Than One Notice or Proxy Card?

You may receive more than one Notice or proxy card if you hold shares of our common stock in more than one account, which may be in registered form or held in street name. Please vote in the Namemanner described above under "How Do I Vote?" for each account to ensure that all of Broker or Bankyour shares are voted.

Will My Shares be Voted if I Do Not Vote?

If your shares are registered directly in your name through our transfer agent or if you have stock certificates, they will not be counted if you do not vote as described above under "How Do I Vote?" If your shares are held in street name and you do not provide voting instructions to the bank, broker or other nominee that holds your shares, the bank, broker or other nominee that holds your shares has the authority to vote your unvoted shares only on the ratification of the appointment of our independent registered public accounting firm (Proposal 2) without receiving instructions from you. Therefore, we encourage you to provide voting instructions to your bank, broker or other nominee. This ensures your shares will be voted at the annual meeting and in the manner you desire. A "broker non-vote" will occur for any particular matter if your bank, broker or other nominee cannot vote your shares on that matter because it has not received instructions from you and does not have discretionary voting authority on the matter or if your bank, broker or other nominee chooses not to exercise discretionary voting authority that it does have.

Your bank, broker or other nominee does not have discretionary voting authority on the election of directors. Therefore, if you hold your shares in street name, it is critical that you cast your vote if you want your vote to be counted for the election of the director (Proposal 1). If you hold your shares in street name and you do not instruct your bank, broker or other nominee how to vote in the election of directors, no votes will be cast on this proposal on your behalf.

What Vote is Required to Approve Each Proposal and How are Votes Counted?

Proposal 1: Elect Director

The nominee for director who receives the most votes (also known as a "plurality" of the votes cast) will be elected. You may vote either FOR the nominee or WITHHOLD your vote from the nominee. Votes that are withheld will not be included in the vote tally for the election of the director. Brokerage firms do not have authority to vote their customers' unvoted shares held by the firms in street name for the election of the director. As a result, any shares not voted by a customer will be treated as a broker non-vote. Such broker non-votes will have no effect on the results of this vote.

Proposal 2: Ratify Appointment of Independent Registered Public Accounting Firm

The affirmative vote of a majority of the shares of our common stock present or represented by proxy and entitled to vote at the annual meeting is required to ratify the appointment of our independent registered public accounting firm. Abstentions will have the effect of votes against this proposal. Brokerage firms have authority to vote their customers' unvoted shares held by the firms in street name on this proposal. If a broker does not exercise this authority, such broker non-votes will have no effect on the results of this vote. We are not required to obtain the approval of our stockholders to select our independent registered public accounting firm. However, if our stockholders do not ratify the appointment of Daszkal Bolton LLP as our independent registered public accounting firm for 2021, the audit committee of our Board of Directors will reconsider its appointment.

Where Can I Find the Voting Results of the Annual Meeting?

The preliminary voting results will be announced at the annual meeting, and we will publish preliminary results, or final results if available, in a Current Report on Form 8-K within four business days of the annual meeting. If final results are unavailable at the time we file the Form 8-K, then we will file an amended report on Form 8-K to disclose the final voting results within four business days after the final voting results are known.

Who Will Pay the Costs of Soliciting these Proxies?

We will pay all of the costs of soliciting these proxies. Our directors and employees may solicit proxies in person or by telephone, fax or email. We will pay these employees and directors no additional compensation for these services. We will ask banks, brokers and other institutions, nominees and fiduciaries to forward these proxy materials to their principals and to obtain authority to execute proxies. We will then reimburse them for their expenses.

What Constitutes a Quorum for the Annual Meeting?

In order to hold the meeting, there must be a quorum. For there to be a quorum at the meeting, the holders of a majority of the outstanding shares of common stock entitled to vote at the meeting must be present or represented by proxy. Shares represented by stockholders of record who are present or represented by proxy at the meeting, including shares that are voted or that abstain on any particular matter and broker non-votes, will be counted for purposes of determining whether there is a quorum.

Attending the Annual Meeting

This year, our annual meeting will be held in a virtual meeting format only, at 9:00 a.m. Central time on Thursday, June 24, 2021. To attend the virtual annual meeting, go to www.proxydocs.com/GNPX shortly before the meeting time, and follow the instructions for downloading the webcast. You need not attend the annual meeting in order to vote.

Householding of Annual Disclosure Documents

SEC rules concerning the delivery of annual disclosure documents allow us or your broker to send a single set of our proxy materials to any household at which two or more of our stockholders reside, if we or your broker believe that the stockholders are members of the same family. This practice, referred to as "householding," benefits both you and us. It reduces the volume of duplicate information received at your household and helps to reduce our expenses. The rule applies to our annual reports, proxy statements and information statements. The practice of householding does not apply to the Notice. Once you receive notice from your broker or from us that communications to your address will be "householded," the practice will continue until you are otherwise notified or until you revoke your consent to the practice. Stockholders who participate in householding will continue to have access to and utilize separate proxy voting instructions.

If a broker or other nominee holds your shares and (1) your household received a single set of proxy materials this year, but you would prefer to receive your own copy or you do not wish to participate in householding and would like to receive your own set of our proxy materials in future years or (2) you share an address with another stockholder and together both of you would like to receive only a single set of proxy materials, please contact the broker or other nominee directly and inform them of your request. Be sure to include your name, the name of your brokerage firm bank, dealerand your account number.

Electronic Delivery of Company Stockholder Communications

Most stockholders can elect to view or other agent as a nominee, you should followreceive copies of future proxy materials over the Internet instead of receiving paper copies in the mail. You can choose this option and save us the cost of producing and mailing these documents by following the instructions provided on your Notice or proxy card or by your broker or bank.following the instructions provided when you vote over the Internet.

When are stockholder proposals and director nominations due for next year’syear’s annual meeting?

To be considered for inclusion in the Company’s proxy materials for next year’s annual meeting, your proposal must be submitted in writing by December 28, 2018.January 15, 2022.

If you wish to submit a proposal (including a director nomination) that is not to be included in the Company’s proxy materials for next year’s annual meeting, you must do so not later than the close of business 90 days, nor earlier than the close of business 120 days, prior to the first anniversary of the date of the 2018 Annual Meeting.between February 24, 2022 and March 26, 2022. In the event the date of the 20192022 annual meeting is more than 30 days before or more than 30 days after such anniversary date, notice must be delivered not earlier than the close of business on the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the 10th day following the day on which public announcement of the date of such meeting is first made. You are also advised to review the Company’s amended and restated bylaws, which contain additional requirements relating to advance notice of stockholder proposals and director nominations.

Proposals should be addressed to:

Genprex, Inc.

Attn: Corporate Secretary

Dell Medical School, Health Discovery Building

1701 Trinity Street, Suite 3.3223300 Bee Caves Road, #650-227

Austin, TX 7871278746

What are “broker non-votes”?

DELINQUENT SECTION 16(a) REPORTS

When a beneficial owner of shares held in “street name” does not give instructions toUnder the brokerage firm, bank, dealer or other agent holding the shares as to how to vote on matters deemed to be non-routine under applicable rules, the broker or nominee cannot vote the shares. These unvoted shares are counted as “broker non-votes.”

How are votes counted and how many votes are needed to approve each proposal?

Votes will be counted by the inspector of election appointed for the Annual Meeting, who will tabulate the votes at the Annual Meeting and will separately count:

The affirmative voteU.S. securities laws, specifically, Section 16(a) of the holdersExchange Act, our directors, executive officers, and beneficial owners of a majority of the sharesmore than 10% of our common stock present or represented by proxy and entitled to vote on the matter isare required to approve the Nasdaq 20% Issuance Proposal.  In addition, for Nasdaq purposes, the Nasdaq 20% Issuance Proposal requires approval by a majority of the votes cast at the meeting, provided that the investors in the Private Placement shall not be entitled to vote either the Shares owned by them or the Warrant Shares underlying Warrants owned by them, which are the Shares and Warrants to purchase our common stock that were issued to the investors pursuant to the Securities Purchase Agreement. If you mark your proxy as “Abstain” on the Nasdaq 20% Issuance Proposal, or if you give specific instructions that no vote be cast on any specific matter, the shares represented by that proxy will not be voted on that matter, but will count in determining whether a quorum is present. Broker non-votes have no effect toward the vote total for the Nasdaq 20% Issuance Proposal.  Abstentions will have the effect of an “Against” vote on the Nasdaq 20% Issuance Proposal because abstentions are considered shares entitled to vote on this proposal.  With respect to the Nasdaq 20% Issuance Proposal, if a stockholder is a beneficial owner of shares held in street name, such stockholder’s bank, broker or other nominee will not be permitted to vote such stockholder’s shares on the approval of the Nasdaq 20% Issuance Proposal unless the bank or broker receives voting instructions from such stockholder.

For the election of directors, the nominees receiving the most “For” votes from the holders of shares present in person or represented by proxy and entitled to vote on the election of directors will be elected.  The only nominee for Class I director to be considered at the Annual Meeting is Mr. Friedman. Only votes “For” will affect the outcome of Proposal 2.

To be approved, the ratification of the selection of Daszkal Bolton LLP as the Company’s independent registered public accounting firm for its fiscal year ending December 31, 2018, must receive “For” votes from the holders of a majority of shares present in person or represented by proxy and entitled to vote on the matter. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes, if any, will have no effect.

As a reminder, if you are a beneficial owner of shares held in street name, in order to ensure your shares are voted in the way you would prefer, you must provide voting instructions to your broker, bank or other agent by the deadline provided in the materials you receive from your broker, bank or other agent.

What is the quorum requirement?

A quorum of stockholders is necessary to hold the Annual Meeting. A quorum will be present if stockholders holding at least a majority of the outstanding shares entitled to vote are present at the Annual Meeting in person or represented by proxy.

Your shares will be counted towards the quorum only if you submit a valid proxy (or one is submitted on your behalf by your brokerage firm, bank, dealer or other agent) or if you vote in person at the Annual Meeting. Abstentions and broker non-votes will be counted towards the quorum requirement. If there is no quorum, the holders of a majority of shares present at the Annual Meeting in person or represented by proxy may adjourn the Annual Meeting to another date.

How can I find out the results of the voting at the Annual Meeting?

Preliminary voting results will be announced at the Annual Meeting. In addition, final voting results will be published in a Current Report on Form 8-K that we expect to file with the SEC within four business days after the Annual Meeting. If final voting results are not available to us in time to file a Form 8-K within four business days after the Annual Meeting, we intend to file a Form 8-K to publish preliminary results and, within four business days after the final results are known to us, file an additional Form 8-K to publish the final results.

PROPOSAL 1

NASDAQ 20% ISSUANCE PROPOSAL

Private Placement

On May 9, 2018, we issued an aggregate of 828,500 sharesreport their initial ownership of our common stock (the “Shares”) at a purchase price of $12.07 per share (the “Per Share Purchase Price”) and warrantsany subsequent changes in that ownership to purchase upthe SEC. Due dates for the reports are specified by those laws, and we are required to 621,376 sharesdisclose in this proxy statement any failure in the past year to file by the required dates. Based solely on written representations of our common stock (the “Warrants”) with an initial exercise price equal to $15.62 per share (the “Exercise Price”), in a private placement (the “Private Placement”) in accordance with a securities purchase agreement (the “Securities Purchase Agreement”) entered into with certain institutionalDirectors and accredited investors (collectively, the “Purchasers”)executive officers and on May 6, 2018. The Per Share Purchase Price and the Exercise Price were subject to adjustment as described below. The total consideration paid to us in the Private Placement was approximately $10,000,000. When issued, the Warrants were exercisable on the earlier of six months from the issuance date or the date of effectivenesscopies of the registration statement registering the underlying shares for resale, in each case subject to ownership limitations, and expire five years from such date. The Warrants are exercisable on a cashless basis six months after the issuance date if there is then no effective registration statement registering the resale of the shares underlying the Warrants. The $10,000,000 purchase price paid by the Purchasers on May 9, 2018 represents the entire purchase pricereports that will be paid by the Purchasers for the Shares and the Warrants, even if additional Shares are issued and additional Warrant Shares become issuable following a Triggering Event discussed below. If the Warrants are exercised in full on a cash basis, we will receive an additional $9,705,893.

We engaged Maxim Group, LLC (“Maxim”) as our exclusive placement agent in connection with the Private Placement. Network 1 Financial Securities, Inc. served as an advisor in connection with the transaction.

When the Shares and Warrants were issued, the Per Share Purchase Price of the Shares, the Exercise Price of the Warrants and the number of Warrant Shares were subject to adjustment based on the lowest volume weighted average price (“VWAP”) for the three trading days (the “VWAP Calculation”) immediately following each of the following events (“Triggering Events”): (i) the date that a registration statement covering the resale of the Shares issued in the Private Placement has been declared effective by the SEC, (ii) if a registration statement covering all Shares issued in the Private Placement is not declared effective, then the date that the Shares can be sold under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), and (iii) if later than the dates set forth in (i) and (ii), then the date that our stockholders approve the Nasdaq 20% Issuance Proposal.  Following a Triggering Event, the Per Share Purchase Price for the Shares would automatically be reduced, if applicable, to 85% of the

lowest of the three VWAPs in the VWAP Calculation, and we would be required to issue to the Purchasers additional Shares to reflect the adjustment to the Per Share Purchase Price so that the total number of Shares issued pursuant to the Securities Purchase Agreement would equal $10,000,000 divided by the Per Share Purchase Price, as adjusted; provided that the Per Share Purchase Price could not be reduced to less than $4.25 per Share and could not be adjusted upward.   In addition, following a Triggering Event, the Exercise Price of the Warrants would automatically be reduced, if applicable, to 110% of the lowest of the three VWAPs in the VWAP Calculation; provided, that in no event would the Exercise Price for the Warrants be reduced to less than $4.25 or increased as a result of an adjustment.  In the event the Exercise Price of the Warrants were adjusted, then the total number of Warrant Shares issuable upon exercise of the Warrants would be increased so that the total exercise price payable to exercise the Warrants after the adjustment is equal to the total exercise price payable to exercise the Warrants before such adjustment. As a result, the maximum number of securities that could be issued under the Securities Purchase Agreement is 2,352,940 Shares and Warrants to purchase an aggregate of 2,283,740 Warrant Shares, based on an adjusted Per Share Purchase Price of $4.25 per share and a Warrant Exercise Price of $4.25 per share.  

On May 22, 2018, our Registration Statement on Form S-1 (File No. 333-225090) (the “Registration Statement”) was filed with the Securities and Exchange Commission, or SEC, to register the resale of up to 2,352,940 Shares and up to 2,283,740 Warrant Shares. On July 26, 2018, the Registration Statement was declared effective by the SEC. As a result of the effectiveness of the Registration Statement, the Warrants became exercisable on July 26, 2018, subject to ownership limitations. The Per Share Purchase Price and the Warrant Exercise Price were both adjusted to $4.25 per share, based on a VWAP of $3.5299 on July 27, 2018. On August 1, 2018, pursuant to the terms of the Securities Purchase Agreement and the Warrants, we issued to the Purchasers an aggregate of 1,174,440 additional Shares, and the Warrants became exercisable for a total of 2,283,740 Warrant Shares, with an exercise price equal to $4.25 per Warrant Share. An additional 350,000 Shares (i.e., the difference between 2,352,940 Shares and the sum of the Shares issued on May 9, 2018 and August 1, 2018) are issuable to one of the Purchasers in the Private Placement upon the request of such Purchaser under the terms of the Securities Purchase Agreement.

Until stockholder approval of the Nasdaq 20% Issuance Proposal is obtained, the total number of Shares issuable pursuant to the Securities Purchase Agreement, plus the total number of Warrant Shares issuable upon exercise of the Warrants, shall not exceed 19.99% of the number of shares of our common stock outstanding immediately before the closing of the Private Placement. The 828,500 Shares initially issued to the Purchaser under the Securities Purchase Agreement and the 1,174,440 Shares issued on August 1, 2018 following the effectiveness of the Registration Statement, together constitute 13.29% of the number of shares of our common stock that were outstanding immediately before the closing of the Private Placement.

The securities issued pursuant to the Securities Purchase Agreement were issued under the exemption from registration provided by Section 4(a)(2) of the Securities Act and the rules and regulation promulgated thereunder, including Regulation D.

Registration Rights

In connection with the Private Placement, we entered into a registration rights agreement (the “Registration Rights Agreement”) with the Purchasers. Pursuant to the Registration Rights Agreement, we agreed to prepare and file a registration statement (the “Resale Registration Statement”) with the SEC by May 21, 2018 for purposes of registering the resale by the Purchasers of up to 2,352,940 Shares and up to 2,283,740 Warrant Shares. We also agreed to use our reasonable best efforts to cause the Resale Registration Statement to be declared effective by the SEC by June 25, 2018 (or July 10, 2018 in the event of a full review by the SEC).

The Registration Rights Agreement includes provisions for liquidated damages for failure to meet the specified filing and effectiveness deadlines or keep the Resale Registration Statement effective, subject to certain

permitted exceptions. Under the Registration Rights Agreement, wethey have agreed to keep the Resale Registration Statement effective at all times until the earlier of (i) the date as of which the Investors may sell all of the securities covered by such registration statement without volume or manner-of-sale limitations pursuant to Rule 144 (or any successor thereto) promulgated under the Securities Act or (ii) the date on which the Investors shall have sold all of the securities covered by the Resale Registration Statement.

On May 10, 2018, we filed with the SEC, a Current Report on Form 8-K (the “Form 8-K”)it is our belief that described the terms of the Private Placement.  We filed as exhibits 4.1, 10.1 and 10.2 to the Form 8-K the form of Warrant, the Securities Purchase Agreement and the form of Registration Rights Agreement.  We refer you to the Form 8-K and the exhibits thereto for a further description of the Private Placement.

The Registration Statement was deemed filed on May 22, 2018, and was declared effective by the SEC on July 26, 2018.

Nasdaq Rule 5635(d)

Nasdaq Rule 5635(d) requires stockholder approval prior to an issuance of securities in connection with a transaction other than a public offering involving the sale, issuance or potential issuance by a company of common stock equal to 20% or more of the common stock or 20% or more of the voting power outstanding before the issuance for less than the greater of book and market valueall of our common stock as of the time of execution of the definitive agreementDirectors and executive officers complied with all Section 16(a) filing requirements applicable to them with respect to such transaction. The provisionstransactions in (i) the Securities Purchase Agreement that prevent the issuance of Shares if such issuance will result in such holders beneficially owning in excess of 19.99% of our common stock (the “Beneficial Ownership Limitation”) prior to stockholder approval and (ii) the Warrants that prevent exercise of the Warrants prior to stockholder approvalequity securities during fiscal year 2020, except for a Form 3 related to the extent the issuanceinitial share ownership of Warrant Shares pursuant to such exercise, when combined with the issuances of Shares pursuant to the Securities Agreement, would be in excess of the Beneficial Ownership Limitation, are both required under Nasdaq Rule 5635(d). We are seeking stockholder approval for the sale and issuance of such Shares and Warrant Shares in connection with the Private Placement pursuant to Nasdaq Rule 5635(d) without regard to the Beneficial Ownership Limitation.

Consequences if Stockholder Approval is Not Obtained

If we do not obtain approval of the Nasdaq 20% Issuance Proposal at the Annual Meeting, we are obligated under the Securities Purchase Agreement to calldirector Brent M. Longnecker upon his becoming a stockholder meeting every four months thereafter to seek approval of the Nasdaq 20% Issuance Proposal from our stockholders until the earlier of the date such approval is obtained or the Warrants are no longer outstanding.  In addition, so long as any Warrants are outstanding, we may not issue any capital stock or equity instruments in a capital raising transaction until we obtain stockholder approval of the Nasdaq 20% Issuance Proposal.  If we do not obtain stockholder approval, the maximum number of shares that will be issuable pursuant to the Private Placement will not exceed 2,605,697 shares, which equals 19.99% of the number of outstanding shares of our common stockdirector on May 5, 2018.

Description of Proposal

We are seeking stockholder approval as required by Nasdaq Rule 5635(d) (as described above) to enable the us to issue a number of shares our common stock in connection with the Private Placement that exceeds 20% of the number of shares of our common stock that were outstanding before the Private Placement, which shares include the Shares issued pursuant to the Securities Purchase Agreement and the Warrant Shares issuable upon exercise of the Warrants, consisting of:

Related Parties

Except for the sale and issuance of the Shares and the Warrants, the participants in the Private Placement have not had any material relationship with us within the past three years, other than Maxim, which served as the placement agent for the Private Placement, and Network 1 Financial Securities, Inc., whichMarch 18, 2020. The Form 3 was the underwriter of our initial public offering and served as an advisor for the Private Placement.  As compensation for serving as placement agent for the Private Placement, we paid to Maxim a fee of $700,000 and reimbursed Maxim’s related expenses.

Vote Required

The affirmative vote of the holders of a majority of the shares of our common stock present in person or represented by proxy and entitled to votefiled on the matter, excluding shares acquired in the Private Placement under the Securities Purchase Agreement, is necessary under Nasdaq Marketplace Rule 5635(e)(4) to approve the Nasdaq 20% Issuance Proposal. Broker non-votes will not affect whether this proposal is approved, but abstentions will have the same effect as a vote against the proposal.

In accordance with applicable Nasdaq Marketplace Rules, holders of the shares of our common stock purchased in the Private Placement are not entitled to vote such shares on the Nasdaq 20% Issuance Proposal.

Prior to the closing of the Private Placement, and as a condition to such closing, certain of our stockholders entered into voting agreements with the Purchasers. As of immediately prior to the closing of the Private Placement, the stockholders executing the voting agreements owned approximately 62% of our total issued and outstanding common stock. Pursuant to the voting agreements, the stockholder signatories agreed to vote all shares of our common stock owned by them in favor of the Nasdaq 20% Issuance Proposal.

Potential Effects of this Proposal

The issuance of the shares of our common stock which are the subject of the Nasdaq 20% Issuance Proposal will result in an increase in the number of shares of common stock outstanding. This will result in a decrease to the respective ownership and voting percentage interests of stockholders prior to the Private Placement. The market value of our Company and our future earnings may be reduced.

In addition, as described above under “Registration Rights,” we have registered the securities issued in the Private Placement, which includes a total of 4,636,680 shares of our common stock, consisting of a maximum of 2,352,940 Shares issued or issuable pursuant to the Securities Purchase Agreement and 2,283,740 Warrant Shares that could become issuable upon exercise of Warrants. The release of up to 4,636,680 freely traded shares onto the market, or the perception that such shares will or could come onto the market, has had and could have an adverse effect on the trading price of our stock.

We have broad discretion to use the net proceeds to us from the sale of such shares, including the proceeds received upon exercise of the Warrants, and you will be relying solely on the judgment of our Board of Directors and management regarding the application of these proceeds. Our use of the proceeds may not improve our operating results or increase the value of your investment.

For your consideration of the Nasdaq 20% Issuance Proposal, a description of the material terms of the Private Placement is set forth in this proxy statement to provide you with basic information concerning the Private Placement. However, the description above is not a substitute for reviewing the full text of the referenced documents, which were attached as exhibits to our Current Report on Form 8-K as filed with the SEC on May 10, 2018.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE “FOR”

THE APPROVAL OF THE NASDAQ 20% ISSUANCE PROPOSAL.March 31, 2020. 

PROPOSAL 21

ELECTION OF CLASS I DIRECTOR

Our Board of Directors is divided into three classes. Each class consists, as nearly as possible, of one-third of the total number of directors, and each class has a three-year term. Vacancies on the Board may be filled only by persons elected by a majority of the remaining directors. A director elected by the Board to fill a vacancy in a class, including vacancies created by an increase in the number of directors, shall serve for the remainder of the full term of that class and until the director’s successor is duly elected and qualified.

The Board presently has threefour members. There is one Class I director, David E. Friedman,Brent M. Longnecker, whose term of office expires in 2018.2021. Proxies may not be voted for a greater number of persons than the one nominee, Mr. Friedman,Longnecker, named in this proxy statement. Mr. Friedman,Longnecker, a current director of the Company, was recommended for nomination to the Board at the Annual Meeting by the Nominating and Corporate Governance Committee of the Board. If elected at the Annual Meeting, Mr. FriedmanLongnecker would serve until the 20212024 annual meeting of stockholders and until his respective successor has been duly elected and qualified, or, if sooner, until his death, resignation or removal. It is the Company’s policy to invite directors and nominees for director to attend the Annual Meeting. Each of our directors attended our annual meeting of stockholders in June 2020.

Directors are elected by a plurality of the votes of the holders of shares present in person or represented by proxy and entitled to vote on the election of directors. Accordingly, the nominee receiving the highest number of affirmative votes will be elected. The only nominee for Class I director to be considered at the Annual Meeting is Mr. Friedman.Longnecker. Shares represented by executed proxies will be voted, if authority to do so is not withheld, for the election of Mr. Friedman.Longnecker. If Mr. FriedmanLongnecker becomes unavailable for election as a result of an unexpected occurrence, shares that would have been voted for that nominee will instead will be voted for the election of a substitute nominee proposed by the Company. Mr. FriedmanLongnecker has agreed to serve if elected. The Company’s management has no reason to believe that Mr. FriedmanLongnecker will be unable to serve.

NomineeNominees

The Nominating and Corporate Governance Committee seeks to assemble a Board that, as a whole, possesses the appropriate balance of professional and industry knowledge, financial expertise and high-level management experience necessary to oversee and direct the Company’s business. To that end, the Nominating and Corporate Governance Committee has identified and evaluated nominees in the broader context of the Board’s overall composition, with the goal of recruiting members who complement and strengthen the skills of other members and who also exhibit integrity, collegiality, sound business judgment and other qualities that the Nominating and Corporate Governance Committee views as critical to effective functioning of the Board. The biographies below include information, as of the date of this Proxy Statement, regarding the specific and particular experience, qualifications, attributes or skills of each director or nominee that led the Nominating and Corporate Governance Committee to believe that that nominee should continue to serve on the Board. However, each member of the Nominating and Corporate Governance Committee may have a variety of reasons why he believes a particular person would be an appropriate nominee for the Board, and these views may differ from the views of other members.

Nominee for Election for a Three-Year Term Expiring at the 20212024 Annual Meeting

David E. FriedmanBrent M. Longnecker, 55,64, has served as a member of our Board since March 18, 2020. Since September 2003, Mr. Longnecker has been the Chairman and Chief Executive Officer of Longnecker & Associates, an executive compensation and corporate governance consulting firm. From June 1999 to August 2012. Since August 2010,2003, Mr. Friedman hasLongnecker served as President of Resources Consulting Group, and Executive Vice President of Resources Connection. Mr. Longnecker has over 35 years of consulting experience, including as National Principal-In-Charge for the Performance Management and Compensation Consulting Practice of Deloitte & Touche and as partner at KPMG Peat Marwick. Mr. Longnecker has worked with companies globally including the industries of high tech, finance, service, manufacturing and more. He is a partnerBoard Fellow with the NACD and is a past board member. Mr. Longnecker holds Bachelor of TCG Group Holdings, an Austin, Texas based SEC-registered investment advisor to separately-managed institutionalBusiness Administration and private client accounts. In addition, since January 2012, Mr. Friedman has served asMBA degrees from the University of Houston. He is a managing partner of ACM Investment Management, which manages hedge fund assets acquired from KeyCorp, the bank holding company parent of KeyBank. From 2006 to 2010, Mr. Friedman served as the Chief Operating Officer of Austin Capital Management, which was owned by KeyCorp, where he led the company’s non-investment functions, including all legal, finance, investor relations, technology and operations teams. Before joining Austin Capital, Mr. Friedman was a Directorprolific author on the Global Prime Brokerage desksubjects of Citigroup in New York,executive compensation and an associate at the law firm of Proskauer Rose in its New York headquarters. Mr. Friedman received his BS in management from Tulane University and his JD from Duke University School of Law. He is admitted to the Bar of the State of New York and holds FINRA Series 4, 7, 24 and 63 securities registrations.corporate governance.

Our Nominating and Corporate Governance Committee and Board believe that Mr. Friedman’s uniqueLongnecker’s more than 35 years of experience in corporate governance, executive compensation, and valuable mix of high-levelrisk management consulting for public, private, and relevant finance, legalnon-profit organizations, and operations experience makeshis deep expertise in healthcare, energy, real estate, manufacturing, and financial companies, make him a well-rounded business leader and a valuable member of our Board.

THE BOARD OF DIRECTORS RECOMMENDS

THAT STOCKHOLDERS VOTE “FOR”“FOR” THE ELECTION OF MR. FRIEDMAN

BRENT M. LONGNECKER  AS THE CLASS I DIRECTOR.

Director Continuing in Office Until the 20192022 Annual Meeting

Robert W. PearsonWilliam R. (“Will”) Wilson, Jr., 56,71, has served as a member of our Board since July 2012. In June 2009,March 18, 2020. Since January 2006, he has served as Chairman, President and Chief Executive Officer of Wilson Land & Cattle Co., an investment company. Mr. Pearson joined W2OWilson has more than 40 years of legal experience in health care regulation, biotechnology, clinical trial management, nursing home licensing and regulation, physician accreditation, securities, corporate governance, contractual and other legal matters. Mr. Wilson is a member of the State Bar of Texas and has been admitted to practice before the United States District Court for the Western District of Texas. Mr. Wilson previously served as Judge of the 250th District Court of Travis County, Texas, where he presided over civil litigation, and as Assistant District Attorney for Dallas County, Texas. Mr. Wilson holds a Bachelor of Science degree from Vanderbilt University and a JD degree from Southern Methodist University. 

Mr. Wilson’s more than 40 years of experience as an attorney in fields related to our business, and as an investor, make him a valuable member of our Board.

Directors Continuing in Office Until the 2023 Annual Meeting

Jose Antonio Moreno Toscano, 48, has served as a member of our Board since March 18, 2020. Since April 2018, Mr. Moreno Toscano has been Chief Executive Officer of LFB USA Inc., the US subsidiary of LFB Group, a global network of complementary marketing, communications, researchintegrated biopharmaceutical company dedicated to developing innovative products through recombinant, plasma derived and development firms, and has held a number of senior positions at W2O Group, including Chief Technology Officer, President and since Februarycell therapy technology. From July 2017 Vice Chair and Chief Innovation Officer. Fromto March 2012 to February 2017,2018, Mr. PearsonMoreno Toscano served as President of W2O,Safe Harbor Compliance and from June 2009Clinical Services, an integrated health care services provider dedicated to March 2012 as its Chief Technology & Media Officer.providing specialty pharmaceuticals and ancillary services in primary care offices. From 2007July 2016 to 2009, Mr. Pearson served as Dell Inc.’s Vice President, Communities and Conversations, and before that as its Vice President, Corporate Group Communications. From 2003 to 2006, Mr. Pearson served as Head of Global Corporate Communications and as Head of Global Pharma Communications at Novartis Pharmaceuticals, whereSeptember 2018, he also served onas a member of the Pharma Executive Committee. Before joining Novartis,board of directors. From March 2016 to March 2017, Mr. PearsonMoreno Toscano served as CEO, Americas, for Kompan Inc., a US subsidiary of Kompan A/S, a world leader in playground equipment. From March 2006 to March 2016, Mr. Moreno Toscano served as President The Americasof ALK-Abello Inc., a US subsidiary of ALK-Abello A/S, a pharmaceutical company that is a world leader in allergy immunotherapy. Prior to ALK-Abello, he was the Chief Financial Officer of Applus A/S, a market leader in automotive inspection services, and Chair, Healthcare Practice for GCI Group,prior to Applus, he held several positions at Christian Hansen Holding A/S, a global public relations consultancy,leader in pharmaceutical manufacturing and was responsibleproducer of natural ingredients for creatingthe food, beverage, dietary supplement and building the firm’s global healthcare practice.agricultural industries. Mr. Pearson previously served as Vice President of Media and Public Affairs at Rhone-Poulenc Rorer, or RPR (now Sanofi-Aventis) and worked at RPR and Ciba-Geigy in communications and pharmaceutical field sales. Mr. PearsonMoreno Toscano holds a BAMaster’s Degree in Law from the University of North Carolina at GreensboroUniversidad de Murcia in Spain and an MBA in International Finance and Strategy from Fairleigh Dickinson University.the Ecole Nationale des Ponts et Chaussees in Paris. Mr. Moreno Toscano holds the National Association of Corporate Directors (NACD) Directorship Certification^TM.

Our Nominating and Corporate Governance Committee and Board believe that Mr. Pearson’s senior managementMoreno Toscano’s more than 20 years of experience at internationalin the pharmaceutical companies and public relations/ investor relations firms,biotechnology industries, building, developing and transforming organizations, and successful track record of identifying and capitalizing on opportunities to drive exponential revenue growth and market expansion, revitalizing underperforming operations and establishing foundations for successful start-up operations, as well as with start-up businesses,his experience in strategic planning, corporate restructuring, business development, M&A, investor relations, and his knowledge and personal contacts in the pharmaceutical industry, and his businessgeneral management, acumen, make him a valuable member of our Board.

Director Continuing in Office Until the 2020 Annual Meeting

J. Rodney Varner61,, 64, is a co-founder of Genprex and has served as our Chief Executive Officer and Secretary, and as a member of our Board and as Chairman of our Board since August 2012. Mr. Varner also served as our President from August 2012 until April 10, 2018. Mr. Varner was again appointed President on August 10, 2020, and currently serves as our President. Mr. Varner has served as a partner of the law firm Wilson & Varner, LLP, since 1991. Mr. Varner has more than thirty-five35 years of legal experience with large and small law firms, and as outside general counsel of a Nasdaq listed company. Mr. Varner has represented for-profit and non-profit companies at the Boardboard or senior management levels in a wide variety of contractual, business, tax and securities matters, including technology transfers, licensing, collaboration and research agreements, clinical trial contracts, pharmaceutical and biologics manufacturing and process development contracts, state and federal grants, including NIH and SBA grants, corporate governance and fiduciary issues, and real estate matters. Mr. Varner served as counsel in company formation, mergers and acquisitions, capital raising, other business transactions, protection of trade secrets and other intellectual property, real estate, and business litigation. Mr. Varner is a member of the State Bar of Texas and has been admitted to practice before the United States Court of Appeals for the Fifth Circuit and the United States Tax Court. Mr. Varner received his BBA,holds a Bachelor of Business Administration degree, with high honors, from Texas A&M University and his J.D.a JD degree from The University of Texas School of Law.

Our Nominating and Corporate Governance Committee and Board believe that Mr. Varner’s broad legal experience, as well as his position of Chief Executive Officer of the Company, qualifies him to serve as a member of our Board.

Former Directors

On April 15, 2020, directors David E. Friedman and Robert W. Pearson resigned from our Board.

INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

Independence of the Board of Directors

Under the listing requirements and rules of The Nasdaq Capital Market, independent directors must constitute a majority of a listed company’s Board within 12 months after its initial public offering.Board. In addition, the rules of The Nasdaq Capital Market require that subject to specified exceptions and phase-in periods following its initial public offering, each member of a listed company’s audit, compensation and nominating and governance committee be independent, and that a listed company’s audit committee must have at least three members and a listed company’s compensation committee must have at least two members. Under the rules of The Nasdaq Capital Market, a director will only qualify as an “independent director” if, in the opinion of that company’s board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.

We intend to rely on the phase-in rules of The Nasdaq Capital Market with respect to the independence of our Board and the Audit Committee. In accordance with these phase-in provisions, our Board and the Audit, Compensation, and Nominating and Corporate Governance Committees have at least two independent members, and all members will be independent within one year of the effective date of the registration statement relating to the initial public offering of our common stock.

Audit committee members must also satisfy independence criteria set forth in Rule 10A-3 under the Securities Exchange Act of 1934 (the “Exchange Act”), or Rule 10A-3. To be considered to be independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of a company’s audit committee, the company’s Boardboard or any other board committee: (1) accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries; or (2) be an affiliated person of the listed company or any of its subsidiaries.

Our Board has undertaken a review of its composition, the composition of its committees and the independence of each director. Based upon information requested from and provided by each director concerning his background, employment and affiliations, including family relationships, our Board has determined that, other than Rodney Varner, our CEO who serves on the Board as the Chairman, each of our directors does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is “independent” as that term is defined under the applicable rules and regulations of the listing requirements and rules of The Nasdaq Capital Market and under the applicable rules and regulations of the SEC. In making this determination, our Board considered the current and prior relationships that each non-employee director has with us and all other facts and circumstances our Board deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each non-employee director.

Board Leadership Structure

Our Chief Executive Officer, Rodney Varner, also currently serves as the Chairman of our Board. The Board does not currently have a lead independent director. We believe that the leadership structure of our Board is appropriate at the present time, in light of the small size of our Board. We believe that the fact that twothree of the threefour members of the Board are independent reinforces the independence of the Board in its oversight of our business and affairs, and provides for objective evaluation and oversight of management’s performance, as well as management accountability. In addition, we have a separate chair for each committee of the Board. The chair of each committee is expected to report to the Board from time to time, or whenever so requested by the Board, on the activities of his committee in fulfilling its responsibilities as detailed in its respective charter or specify any shortcomings should that be the case.

Role of the Board in Risk Oversight

The Audit Committee of our Board is primarily responsible for overseeing our risk management processes on behalf of our Board. Going forward, weWe expect that the Audit Committee will receive reports from management on at least a quarterly basis regarding our assessment of risks. In addition, the Audit Committee reports regularly to our Board, which also considers our risk profile. The Audit Committee and our Board focus on the most significant risks we face and our general risk management strategies. While our Board oversees our risk management, management is responsible for day-to-day risk management team processes.

Meetings of the Board of Directors

The Board met threeseven times and acted by unanimous written consent four times during 2017.in 2020. All directors attended at least 75%each of the aggregate number of meetings of the Board during 2017. The Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee did not meet in 2017.2020. 

INFORMATION REGARDING COMMITTEES OF THE BOARD OF DIRECTORS

On September 25, 2017, in anticipation of our initial public offering, which occurred on March 29, 2018, ourThe Board has established an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee. Each of the committees has authority to engage legal counsel or other experts or consultants, as it deems appropriate to carry out its responsibilities. Our Board may establish other committees to facilitate the management of our business. The composition and functions of each committee are described below. Members serve on these committees until their resignation or until otherwise determined by our Board.

Audit Committee

Our Audit Committee currently consists of Brent M. Longnecker, Jose Antonio Moreno Toscano and Will R. Wilson, Jr. Until April 15, 2020, our Audit Committee also included David Friedman and Robert Pearson. The chair of our Audit Committee is Mr. Friedman, who ourOur Board has determined that each of Brent Longnecker and Jose Antonio Moreno Toscano is an “audit committee financial expert” as that term is defined by theapplicable SEC rules, implementing Section 407and that each possesses financial sophistication, as defined under the listing standards of The Nasdaq Capital Market. Since July 24, 2020, the Sarbanes-Oxley Act,Chair of our Audit Committee has been Mr. Moreno Toscano. Until April 15, 2020, the Chair of our Audit Committee was David Friedman, whom our Board also determined was an “audit committee financial expert” and possessespossessed financial sophistication, as defined under the listing standards of The Nasdaq Capital Market. Our Board made a qualitative assessment of each of Mr. Longnecker's, Mr. Moreno Toscano's and Mr. Friedman’s level of knowledge and experience based on a number of factors, including his formal education, experience in finance and other areas, business acumen and independence. Our Board has also determined that each member of our Audit CommitteeMr. Longnecker, Mr. Moreno Toscano and Mr. Wilson can read and understand fundamental financial statements in accordance with applicable requirements. In arriving at these determinations, the Board has examined each Audit Committee member’s scope of experience and the nature of their experience in the corporate finance sector.finance. The Board has adopted a written Audit Committee charter that is available to stockholders on the Company’sour website at www.genprex.com. www.genprex.com. The information on our website is not incorporated by reference into this Proxy Statement or our Annual Report on Form 10-K for the year ended December 31, 2017.2020. The Audit Committee did not meetmet six times during the year ended December 31, 2017.2020.

The Board reviews the Nasdaq listing standards definition of independence and the requirements of the Exchange Act relating to independence for Audit Committee members on an annual basis and has determined that all members of our Audit Committee are independent (as independence is defined in the Nasdaq listing standards and Rule 10A-3 of the Exchange Act).

The responsibilities of our Audit Committee include:

appointing, approving the compensation of, and assessing the independence of our registered public accounting firm;

 

overseeing the work of our registered public accounting firm, including through the receipt and consideration of reports from such firm;

 

reviewing and discussing with management and the 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;

 

discussing our risk management policies;

 

reviewing and approving or ratifying any related person transactions; and

 

preparing the Audit Committee report required by SEC rules.

 

Report of the Audit Committee of the Board of Directors*Directors

The following Audit Committee Report shall not be deemed to be “soliciting material,” deemed “filed” with the SEC or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Notwithstanding anything to the contrary set forth in any of the Company’s previous filings under the Securities Act of 1933, as amended, or the Exchange Act that might incorporate by reference future filings, including this Proxy Statement, in whole or in part, the following Audit Committee Report shall not be incorporated by reference into any such filings.

The Audit Committee is comprised of three independent directors (as defined under Nasdaq Listing Rule 5605(a)(2)). The Audit Committee operates under a written charter, which is available on our website at www.genprex.com.

 

The Audit Committee has reviewed and discussed the audited financial statements for the fiscal year ended December 31, 20172020 with management of the Company. The Audit Committee has discussed with the independent registered public accounting firm the matters required to be discussed by Auditing Standard No. 1301, Communications with Audit Committees, as adopted by the Public Company Accounting Oversight Board (“PCAOB”). The Audit Committee has also received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent registered public accounting firm's communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firm the accounting firm’s independence. Based on the foregoing, the Audit Committee has recommended to the Board that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017.2020 for the filing with the US Securities and Exchange Commission.

 

David E. Friedman (Chair)

Robert W. Pearson

Jose Antonio Moreno Toscano, Chair Brent M. Longnecker Will R. Wilson, Jr.

 

* The material in this report is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference in any filing of the Company under the Exchange Act or the Securities Act of 1933, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

 

Compensation Committee

 

Our Compensation Committee currently consists of Brent M. Longnecker, Jose Antonio Moreno Toscano and Will R. Wilson, Jr. Until April 15, 2020, our Compensation Committee also included David Friedman and Robert Pearson. The chairSince July 24, 2020, the Chair of our Compensation Committee ishas been Mr. Longnecker.  Until April 15, 2020, the Chair of our Compensation Committee was Robert Pearson. The Board has adopted a written Compensation Committee charter that is available to stockholders on the Company’sour website at www.genprex.com. www.genprex.com. The information on our website is not incorporated by reference into this Proxy Statement or our Annual Report on Form 10-K for the year ended December 31, 2017.2020. The Compensation Committee did not meetmet one time during the year ended December 31, 2017.2020.

 

The responsibilities of our Compensation Committee include:

 

reviewing and approving, or recommending that our Board approve, the compensation of our chief executive officer and our other executive officers;

 

reviewing and recommending to our Board the compensation of our directors;

 

selecting independent compensation consultants and advisers and assessing whether there are any conflicts of interest with any of the committee’s compensation advisers; and

 

reviewing and approving, or recommending that our Board approve, incentive compensation and equity plans.

 

Compensation Committee Processes and Procedures

 

The Compensation Committee discusses and makes recommendations to the Board for annual compensation adjustments, annual bonuses, annual equity awards, and corporate performance objectives. For executives other than the Chief Executive Officer, the Compensation Committee solicits and considers evaluations and recommendations submitted to the Compensation Committee by the Chief Executive Officer. In the case of the Chief Executive Officer, the evaluation of his performance is conducted by the Compensation Committee, which determines recommendations to the Board regarding any adjustments to his compensation as well as awards to be granted. The Chief Executive Officer does not participate in, and is not present during, any deliberations or determinations of the Compensation Committee regarding his compensation or individual performance objectives. For all executives and directors as part of its deliberations, the Compensation Committee may review and consider, as appropriate, materials such as financial reports and projections, operational data, executive and director stock ownership information, company stock performance data, analyses of historical executive compensation levels and current Company-wide compensation levels, compensation data from comparative companies, compensation surveys, and recommendations of any compensation consultant, if applicable.

 

The charter of the Compensation Committee grants the Compensation Committee full access to all books, records, facilities and personnel of the Company. In addition, under its charter, the Compensation Committee has the authority to obtain, at the expense of the Company, advice and assistance from internal and external legal, accounting or other advisers and other external resources that the Compensation Committee considers necessary or appropriate in the performance of its duties. The Compensation Committee has direct responsibility for the oversight of the work of any advisers engaged for the purpose of advising the Compensation Committee. The Compensation Committee has the authority to retain compensation consultants to assist in its evaluation of executive and director compensation, including the authority to approve the consultant’s reasonable fees and other retention terms. Under its charter, to the extent required by SEC and Nasdaq rules, the Compensation Committee may select, or receive advice from, a compensation consultant, legal counsel or other adviser to the Compensation Committee, other than in-house legal counsel and certain other types of advisers, only after taking into consideration six factors, prescribed by the SEC and Nasdaq, that bear upon the adviser’s independence; however, there is no requirement that any adviser be independent.

 

In 2017,2020, after taking into account the six factors prescribed by the SEC and Nasdaq, the Company engaged Longnecker & Associates (“Longnecker”)Aon Radford as its compensation consultant. LongneckerAon Radford was retained to provide an assessment of the Company’s executive and director compensation programs in comparison to executive and director compensation programs at selected publicly-traded peer companies. As part of its engagement, LongneckerAon Radford was requested by the Compensation Committee to develop the peer group of comparative companies and to perform analyses of compensation levels for that group. LongneckerAon Radford developed peer group and related recommendations that were presented to the Compensation Committee for its consideration.

 

Nominating and Corporate Governance Committee

 

Our Nominating and Corporate Governance Committee currently consists of Brent M. Longnecker, Jose Antonio Moreno Toscano and Will R. Wilson, Jr. Until April 15, 2020, our Nominating and Corporate Governance Committee also included David Friedman and Robert Pearson. The chairSince July 24, 2020, the Chair of our Nominating and Corporate Governance Committee ishas been Mr. Longnecker. Until April 15, 2020, the Chair of our Nominating and Corporate Governance Committee was David Friedman. The Board has adopted a written Nominating and Corporate Governance Committee charter that is available to stockholders on the Company’sour website at www.genprex.com. www.genprex.com. The information on our website is not incorporated by reference into this Proxy Statement or our Annual Report on Form 10-K for the year ended December 31, 2017.2020. The Nominating and Corporate Governance Committee did not meetmet two times during the year ended December 31, 2017.2020.

 

The responsibilities of our Nominating and Corporate Governance Committee include:

 

identifying individuals qualified to become members of our Board;

 

recommending to our Board the persons to be nominated for election as directors and for appointment to each of the board’sBoard’s committees;

 

reviewing and making recommendations to our Board with respect to management succession planning;

 

developing and recommending to our Board corporate governance principles; and

 

overseeing a periodic evaluation of our Board.

 

The Nominating and Corporate Governance Committee does not set specific criteria for directors but seeks individuals who have the ability to read and understand basic financial statements, the highest personal integrity and ethics, relevant expertise upon which to be able to offer advice and guidance to management, sufficient time to devote to the affairs of the Company, the ability to exercise sound business judgment and the commitment to rigorously represent the long-term interests of the Company’s stockholders. The Nominating and Corporate Governance Committee may modify these qualifications from time to time. Candidates for director nominees are reviewed in the context of the current composition of the Board, the operating requirements of the Company and the long-term interests of stockholders. In conducting this assessment, the Nominating and Corporate Governance Committee considers diversity, age, skills and such other factors as it deems appropriate to maintain a balance of knowledge, experience and capability.

 

In the case of incumbent directors whose terms of office are set to expire, the Nominating and Corporate Governance Committee reviews these directors’ overall service to the Company during their terms, including the number of meetings attended, level of participation, quality of performance and any other relationships and transactions that might impair the directors’ independence. In the case of new director candidates, the Nominating and Corporate Governance Committee also determines whether the nominee is independent for Nasdaq purposes, which determination is based upon applicable Nasdaq listing standards, applicable SEC rules and regulations and the advice of counsel, if necessary. The Nominating and Corporate Governance Committee then uses its network of

contacts to compile a list of potential candidates, but may also engage, if it deems appropriate, a professional search firm. The Nominating and Corporate Governance Committee conducts any appropriate and necessary inquiries into the backgrounds and qualifications of possible candidates after considering the function and needs of the Board. The Nominating and Corporate Governance Committee meets to discuss and consider the candidates’ qualifications and then selects candidates for recommendation to the Board by majority vote.

 

The Nominating and Corporate Governance Committee will consider director candidates recommended by stockholders. The Nominating and Corporate Governance Committee does not intend to alter the manner in which it evaluates candidates based on whether or not the candidate was recommended by a stockholder. Stockholders who wish to recommend individuals for consideration by the Nominating and Corporate Governance Committee to become nominees for election to the Board may do so by delivering a written recommendation to the Nominating and Corporate Governance Committee at the following address: c/o Genprex, Inc., Dell Medical School, Health Discovery Building, 1701 Trinity Street, Suite 3.322,3300 Bee Caves Road, #650-227, Austin, TX 78712,78746, Attn: Secretary, no later than the close of business on the 90th day nor earlier than the close of business on the 120th day prior to the first anniversary of the preceding year’s annual meeting. In the event the date of the annual meeting is more than 30 days before or more than 30 days after such anniversary date, notice must be delivered not earlier than the close of business on the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting or the 10th day following the day on which public announcement of the date of such meeting is first made. Submissions must include the name and address of the Company stockholder on whose behalf the submission is made; the number of Company shares that are owned beneficially by such stockholder as of the date of the submission; the full name of the proposed candidate; a description of the proposed candidate’s business experience for at least the previous five years; complete biographical information for the proposed candidate; and a description of the proposed candidate’s qualifications as a director. Any such submission must be accompanied by the written consent of the proposed nominee to be named as a nominee and to serve as a director if elected.

 

STOCKHOLDER COMMUNICATIONS WITH THE BOARD OF DIRECTORS

 

The Board has adopted a formal process by which stockholders may communicate with the Board or any of its directors. Stockholders who wish to communicate with the Board may do so by sending written communications addressed to the Secretary of Genprex, Inc., Dell Medical School, Health Discovery Building, 1701 Trinity Street, Suite 3.322,3300 Bee Caves Road, #650-227, Austin, TX 78712.78746. These communications will be reviewed by the Secretary of Genprex, who will determine whether the communication is appropriate for presentation to the Board or the relevant director. The purpose of this screening is to allow the Board to avoid having to consider irrelevant or inappropriate communications (such as advertisements, solicitations and hostile communications).

 

ETHICS CODE

We have adopted a written Code of Business Conduct and Ethics, or Ethics Code, that applies to all of our officers, directors and employees. The Ethics Code is available on our website at www.genprex.com. The information on our website is not incorporated by reference into this Proxy Statement or our Annual Report on Form 10-K for the year ended December 31, 2020. If we make any substantive amendments to the Ethics Code or grant any waiver from a provision of the Ethics Code to any executive officer or director, we will promptly disclose the nature of the amendment or waiver on our website and/or in our public filings with the SEC.

 

PROPOSAL 32

RATIFICATION OF SELECTION OF

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

The Audit Committee has selected Daszkal Bolton LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 20182021 and has further directed that management submit the selection of its independent registered public accounting firm for ratification by the stockholders at the Annual Meeting. Daszkal Bolton has audited the Company’s financial statements since 2012. Representatives of Daszkal Bolton are not expected to be present at the Annual Meeting.

 

Neither the Company’s amended and restated bylaws nor other governing documents or law require stockholder ratification of the selection of Daszkal Bolton as the Company’s independent registered public accounting firm. However, the Audit Committee is submitting the selection of Daszkal Bolton to the stockholders

for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee will reconsider whether or not to retain that firm. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of different independent auditors at any time during the year if they determine that such a change would be in the best interests of the Company and its stockholders.

 

The affirmative vote of the holders of a majority of the shares present in person or represented by proxy and entitled to vote on the matter at the Annual Meeting will be required to ratify the selection of Daszkal Bolton.

 

Principal Accountant Fees and Services

The following table sets forth the fees billed by Daszkal Bolton LLP for audit, audit-related, tax and all other services rendered for 20172020 and 2016:2019:

 

Fee Category	2017	2016		2020				2019
Audit Fees	$75,333	$23,000		$	67,500			$	57,500
Audit-Related Fees	--	--
Tax Fees	3,400	3,300			3,675				3,500
All Other Fees	--	7,000			25,000				26,500
Total Fees	$78,733	$33,300		$	96,175			$	87,500

 

Audit Fees.    Audit fees consist of fees billed for the audit of our annual consolidated financial statements and the review of the interim consolidated financial statements, and related services that are normally provided in connection with registration statements, including the registration statement for our initial public offering. Included in the 2017 audit fees is $31,100 of fees billed in connection with our initial public offering in April 2018.statements.

 

Tax Fees.       Tax fees consist of aggregate fees for tax compliance and tax advice, including the review and preparation of our various jurisdictions' income tax returns.returns for various jurisdictions.

Other Fees.   Other fees consist of common accounting services that are provided in connection with registration statements, including the registration statements for our registered direct offerings.

 

The Board of Directors pre-approved all services performed.

 

In connection with the audit of the 20172020 financial statements, the Company entered into an engagement agreement with Daszkal Bolton LLP that sets forth the terms on which Daszkal Bolton would perform audit services for the Company. That agreement is subject to alternative dispute resolution procedures.

 

Pre-Approval Policies and Procedures

 

The Audit Committee has adopted a policy for the pre-approval of audit and non-audit services rendered by the Company’s independent registered public accounting firm, Daszkal Bolton. The policy generally pre-approves specified services in the defined categories of audit services, audit-related services and tax services up to specified amounts. Pre-approval may also be given as part of the Audit Committee’s approval of the scope of the engagement of the independent auditor or on an individual, explicit, case-by-case basis before the independent auditor is engaged to provide each service.

 

The pre-approval of services may be delegated to one or more of the Audit Committee’s members, but the decision must be reported to the full Audit Committee at its next scheduled meeting.

 

The Audit Committee has determined that the rendering of services other than audit services by Daszkal Bolton is compatible with maintaining the principal accountant’s independence.

 

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE “FOR”

“FOR”THE RATIFICATION OF THE SELECTION OF DASZKAL BOLTON LLP

AS THE COMPANY’SCOMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

FOR THE FISCAL YEAR ENDING DECEMBER 31, 20182021.

 

 

EXECUTIVE OFFICERS

 

J. Rodney Varner, 64, is a co-founder of Genprex and has served as our Chief Executive Officer and Secretary, and as a member of our Board and as Chairman of our Board since August 2012. Mr. Varner also served as our President from August 2012 until April 10, 2018. Mr. Varner was again appointed President on August 10, 2020, and currently serves as our President. For additional information about Mr. Varner’s experience and education, see above under “Director Continuing in Office until“Nominees for Election for a Three-Year Term Expiring at the 20202023 Annual Meeting.”

 

Julien L. Pham, MD, MPH, 41, has served as our Chief Operating Officer since October 2016 and as our President since April 10, 2018. In March 2013, Dr. Pham co-founded RubiconMD, a healthcare IT company that connects primary care providers to specialists for additional guidance and opinions on medical cases, and served as its Chief Medical Officer from March 2013 to September 2016. Prior to co-founding RubiconMD, Dr. Pham served on the faculty at Harvard Medical School’s Brigham and Women’s Hospital, where he joined as a fellow in July 2008 and became an Associate Physician in the Division of Nephrology in August 2011. Dr. Pham has over fifteen years of leadership experience in clinical settings and in emerging medical technology companies. During this time, he has held various research and teaching positions including Chief Residency in Internal Medicine and Pediatrics at the University of Illinois at Chicago Medical Center, and has received multiple awards including excellence in teaching awards from AOA and Harvard Medical School. He is a board-certified internal medicine doctor and nephrologist. Dr. Pham has received NIH research funding for translational research while at Harvard Medical School, and he has published in basic science, translational, and health policy fields. He holds a BS in Cell and Molecular Biology from University of Washington and received his MD from the University of Washington School of Medicine and his MPH at the Harvard School of Public Health.

Ryan M. Confer37,, 39, has served as our Chief Financial Officer since September 2016. From December 2013 through September 2016, he served as our Chief Operating and Financial Officer, and from June 2011 to December 2013 as our business Manager. Mr. Confer has served us in a variety of strategic, operations, and finance capacities since our inception in 2009 both as a consultant through his own firm, Confer Capital, Inc., and as an employee. Mr. Confer has over ten10 years of entrepreneurial and executive experience in planning, launching, developing, and growing emerging technology companies andcompanies. He has served in the chief operatingc-level and chief financialvice president roles for non-profit and for-profit entities since 2008. Most notably, Mr. Confer has also served as VP of Customer Experience and then later as VP of Strategy for KaiNexus Inc., an internationalemerging technology company that develops continuous improvement software. Prior to his entrepreneurial experience, Mr. Confer served as a business development consultant for the University of Texas at Austin’s IC2 Institute, an international think tank and incubator, where he focused on evaluating the commercialization potential of nascent technologies in domestic and international markets applicable to technology incubator programs associated with the University.emerging growth markets. Mr. Confer holds a BS in finance and legal studies from Bloomsburg University of Pennsylvania and an MS in technology commercialization from the McCombs School of Business at the University of Texas at Austin.

Michael T. Redman, 66, has served as our Executive Vice President and Chief Operating Officer since March 12, 2020. From time to time from August 7, 2019 to March 12, 2020, Mr. Redman served as an advisor to us. Mr. Redman has more than 30 years of experience in the life sciences industry. He has held a variety of key executive roles at clinical-stage companies, where he focused on strategic business development and U.S. and worldwide manufacturing and clinical operations. He has been instrumental in the consummation of multiple strategic transactions in the biotechnology and pharmaceutical industries. Since June 2019, Mr. Redman has served as an independent consultant to biotechnology and life science companies.  From January 2007 to May 2019, Mr. Redman served as President, Chief Executive Officer and Director of Oncolix, Inc., a publicly traded clinical-stage biopharmaceutical company focused on developing therapies for women’s and children’s cancers. Beginning in 2018, Mr. Redman also served as the Chief Financial Officer of Oncolix.  During his tenure at Oncolix, he advanced the company’s lead drug into human clinical trials, completed the in-licensing of a promising radiopharmaceutical drug for the treatment of bone-related cancers, and took the company public. Prior to Oncolix, he was the CEO of Bone Medical Limited, an Australia-based clinical stage company developing oral peptide products for the treatment of osteoporosis. In 2001, he co-founded Opexa Pharmaceuticals Inc., a company developing immunotherapies for a variety of diseases, and served as its President and CEO until 2005. Mr. Redman also held key management positions with Zonagen, Inc. (now Repros Therapeutics Inc., which is a part of Allergan plc), Aronex Pharmaceuticals, Inc. (acquired by Antigenics Inc.), Biovail Corporation and American Home Products Corporation (which was renamed Wyeth and acquired by Pfizer Inc.). Mr. Redman earned a BA in Biology from the University of Missouri and an MBA from the University of Phoenix.

Catherine M. Vaczy, 59, has served as our as Executive Vice President and Chief Strategy Officer since March 12, 2020 and from November 10, 2020 as our Executive Vice President, General Counsel and Chief Strategy Officer. From December 1, 2019 to March 12, 2020, Ms. Vaczy served as an advisor to us. Ms. Vaczy has more than 20 years of experience as a founder and senior executive of life science companies, serving as a strategic partner and business and legal advisor to senior leadership teams and boards. From 2015 through 2019, Ms. Vaczy provided strategic advisory services to early stage biotechnology companies and other technology driven companies. In 2005, Ms. Vaczy co-founded and served for 10 years as General Counsel and Secretary of NeoStem, Inc. (now Caladrius Biosciences, Inc.), a Nasdaq-listed clinical stage biotechnology company that combined a leading cell and gene therapy process development and manufacturing organization (which was sold to Hitachi Chemical Co. America, Ltd.) with a development pipeline of cell therapy products. Prior to founding NeoStem, from 1997 through 2003, she was an executive serving in roles of increasing responsibility, most recently as Vice President, Legal, Associate General Counsel and Assistant Secretary of Nasdaq-listed ImClone Systems Incorporated (which was sold to Eli Lily and Company), a pioneer in targeted cancer therapy, where she was instrumental in forging important strategic alliances, including a transformative $1 billion co-development deal for the Company’s blockbuster drug, Erbitux. Earlier in her career, Ms. Vaczy was a practicing attorney in a nationally recognized law firm representing early-stage life science and other technology companies. Ms. Vaczy received a BA degree from Boston College and a JD degree from St. John’s University School of Law.

 

Each of Mr. Varner, Dr. PhamMr. Confer, Mr. Redman and Mr. ConferMs. Vaczy is currently a full-time employee of Genprex. Mr. Varner spends fewer than 105 hours per month on duties relating to Wilson & Varner, LLP; Dr. Pham spends fewer than 10 hours per month in continuing medical practice to comply with licensing requirements; andLLP, Mr. Confer spends fewer than 10 hours per month providing financial consulting services to other companies that are not competitive with us and Ms. Vaczy spends fewer than eight hours per month engaged in activities with companies in which she has an equity investment that are not competitive with us.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

 

Section 16(a)Family Relationships

There are no family relationships between any of our current or former directors or executive officers.

Involvement in Certain Legal Proceedings

To the Securities Exchange Actbest of 1934, as amended, requires the Company’sour knowledge, none of our directors or executive officers and persons who own more thanhave, during the past ten percent (10%)years, been involved in any legal proceedings described in subparagraph (f) of a registered classItem 401 of the Company’s equity securities, to file initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company with the SEC. Officers, directors and stockholders holding more than ten percent (10%) of the outstanding capital stock of the Company are required by SEC regulations to furnish the Company with copies of all Section 16(a) reports they file.Regulation S-K.

 

During the fiscal year ended December 31, 2017, the Company was not subject to the requirements of Section 16(a) of the Exchange Act.Arrangements between Officers and Directors

 

To our knowledge, there is no arrangement or understanding between any of our officers and any other person, including our directors, pursuant to which the officer was selected to serve as an officer.

 

SECURITY OWNERSHIP OF

CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information available to us with respect to the beneficial ownership of our common stock as of August 1, 2018,April 26, 2021, by:

 

each person, or group of affiliated persons, known by us to beneficially own more than 5% of any class of our voting securities;

 

each of our directors;

 

each of our named executive officers;Named Executive Officers; and

 

all of our current executive officers and directors as a group.

 

The table lists applicable percentage ownership based on 15,037,94447,363,729 shares of common stock outstanding as of August 1, 2018.April 26, 2021. Options and warrants to purchase shares of our common stock that are exercisable as of April 26, 2021 or within 60 days of August1, 2018,April 26, 2021, are deemed to be beneficially owned by the persons holding these options for the purpose of computing percentage ownership of that person, but are not treated as outstanding for the purpose of computing any other person’s ownership percentage.

Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Except as noted by footnote, and subject to community property laws where applicable, we believe, based on the information provided to us, that the persons and entities named in the table below have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them.

Except as otherwise noted below, the address for each person or entity listed in the table is c/o Genprex, Inc., Dell Medical School, Health Discovery Building, 1701 Trinity Street, Suite 3.322,3300 Bee Caves Road, #650-227, Austin, Texas 78712.TX 78746.

 

	Shares Beneficially Owned
Beneficial Owner	Number		Percentage
5% or Greater Stockholders
Christy Mallinson Nance(1)	3,167,694		20.8%
Jack A. Roth, MD, FACS(2)	2,393,853		15.9%
Viet-An Hoan Ly and affiliated entities(3)	2,294,760		14.2%
Texas Treasury Safekeeping Trust Company(4)	1,235,219		8.2%
Sabby Volatility Master Fund, Ltd.(5)	755,070		4.99%
Hudson Bay Master Fund, Ltd.(6)	1,542,140		9.99%
Directors and Named Executive Officers
J. Rodney Varner(7)	2,794,459		17.8%
Julien Pham(8)	78,008		*
Ryan Confer(9)	566,008		3.6%
David E. Friedman(10)	307,111		2.0%
Robert W. Pearson(11)	307,111		2.0%
All current executive officers and directors as a group (5 persons)(7)(8)(9)(10)(11)	4,052,736		24.0%

		Shares Beneficially Owned
Beneficial Owner		Number				Percentage
5% or Greater Stockholders
Altium Capital Management LP (1)			2,400,000				5.07	%
Directors and Named Executive Officers
J. Rodney Varner			3,990,491	(2)			8.11	%
Ryan M. Confer			1,026,922	(3)			2.13	%
Julien L. Pham			762,965	(4)			1.60	%
Catherine M. Vaczy			240,000	(5)			*
Brent M. Longnecker			88,843	(6)			*
Jose Antonio Moreno Toscano			53,843	(7)			*
William R. Wilson, Jr.			53,843	(8)			*
All current executive officers and directors as a group (8 persons)			5,698,387	(9)			11.22	%

 

*

Represents beneficial ownership of less than 1%.

(1)

Includes 2,956,298Pursuant to the Schedule 13G/A filed by Altium Growth Fund, LP (“Altium Fund”), Altium Capital Management, LP ("Altium Capital") and Altium Growth GP, LLC (Altium GP”) on February 19, 2021, securities that are the subject of such Schedule 13G/A are held in the name of Altium Growth Fund. Altium Capital is the investment adviser of, and may be deemed to beneficially own the securities owned by, Altium Fund.  Altium GP is the general partner of, and may be deemed to beneficially own the securities owned by, Altium Fund. The address of Altium Fund, Altium Capital and Altium GP is 152 West 57th Street, FL 20, New York, NY 10019.

(2)

Represents (i) 534,735 shares of common stock held by Domecq Sebastian, LLC and 161,396 shares of common stock that Domecq Sebastian, LLC has the right to acquire from us within 60 days of August 1, 2018 pursuant to the exercise of stock options. Domecq Sebastian, LLC is affiliated with David Nance, a former director and officer who is now deceased. Christy Mallinson Nance holds voting and dispositive power of the securities held by Domecq Sebastian, LLC. The address of Domecq Sebastian, LLC is 8203 Scenic Ridge Cove, Austin, Texas 78735.

(2)

Includes 1,338,999 shares of common stock held by JREG Investments, Ltd. and 5,000 shares of common stock that Dr. Roth has the right to acquire from us within 60 days of August 1, 2018, pursuant to a consulting agreement between Dr. Roth and us. Dr. Roth holds voting and dispositive power over the shares held by JREG Investments, Ltd. The address of JREG Investments, Ltd. and of Dr. Roth is 6516 Brompton Road, Houston, Texas 77005.

(3)

Includes (a) 583,008 shares of common stock held by Inception Fund LP, (b) 475,974 shares of common stock held by Tangletrade Fund LP, (c) 102,000 shares of common stock held by Inception Incubator Limited, (d) 3,154 shares of common stock held by Blackbox Data LLC, (e) 9,023 shares of common stock held by New Path Mining LLC, (f) 542,656 shares of common stock that Inception Fund, LP has the right to acquire from us within 60 days of August 1, 2018 pursuant to the exercise of a warrant, (g) 497,130 shares of common stock that Tangletrade Fund LP has the right to acquire from us within 60 days of August 1, 2018 pursuant to the exercise of a warrant, (h) 25,000 shares of common stock that Inception Incubator Limited has the right to acquire from us within 60 days of August 1, 2018, and (h) 56,815 shares of common stock that Mr. Ly has the right to acquire from us within 60 days of August 1, 2018 pursuant to the exercise of stock options. Viet-An Hoan Ly holds voting and dispositive power over the shares held by Inception Fund LP, Tangletrade Fund LP, Inception Incubator Limited, Blackbox Data LLC and New Path Mining LLC. The address of each of these entities and of Mr. Ly is 5400 Carillon Point Road, Building 5000, Kirkland, Washington 98033.

(4)

Paul Ballard, the Chief Executive Officer of the Texas Treasury Safekeeping Trust Company, holds voting and dispositive power of the securities held by the Texas Treasury Safekeeping Trust Company. The address of the Texas Treasury Safekeeping Trust Company is 208 East 10th Street, Austin, Texas 78701.

(5)

Beneficial ownership includes shares of common stock and shares of common stock issuable upon exercise of a warrant that are subject to a 4.99% ownership blocker, pursuant to which shares of our common stock may not be issued to the extent such issuance would cause Sabby Volatility Warrant Master Fund, Ltd. to beneficially

own more than 4.99% of our outstanding common stock.  The share ownership numbers and percentages for Sabby Volatility Warrant Master Fund, Ltd. in the table above reflect this 4.99% blocker. As of August 1, 2018, Sabby Volatility Warrant Master Fund, Ltd. holds a warrant to purchase 1,141,870 shares of our common stock and has the right to acquire from us 350,000 shares of our common stock. Sabby Management, LLC is the investment manager of Sabby Volatility Warrant Master Fund, Ltd. and shares voting and investment power with respect to these shares in this capacity. As manager of Sabby Management, LLC, Hal Mintz also shares voting and investment power on behalf of Sabby Volatility Warrant Master Fund, Ltd. Each of Sabby Management, LLC and Hal Mintz disclaims beneficial ownership over the securities listed except to the extent of their pecuniary interest therein. The address of principal business office of Sabby Volatility Warrant Master Fund, Ltd., Sabby Management, LLC and Hal Mintz is 10 Mountainview Road, Suite 205, Upper Saddle River, New Jersey 07458. Sabby Volatility Warrant Master Fund, Ltd. is not a registered broker-dealer or an affiliate of a registered broker-dealer.

(6)

Beneficial ownership includes shares of common stock issuable upon exercise of a warrant that are subject to a 9.99% ownership blocker, pursuant to which shares of our common stock may not be issued to the extent such issuance would cause Hudson Bay Master Fund, Ltd. to beneficially own more than 9.99% of our outstanding common stock. The share ownership numbers and percentages in the table above reflect this 9.99% blocker. As of August 1, 2018, Hudson Bay Master Fund, Ltd. holds a warrant to purchase 1,141,870 shares of our common stock. Hudson Bay Capital Management LP, the investment manager of Hudson Bay Master Fund Ltd., has voting and investment power over these securities. Sander Gerber is the managing member of Hudson Bay Capital GP LLC, which is the general partner of Hudson Bay Capital Management LP. Sander Gerber disclaims beneficial ownership over these securities.

(7)

Includes (a)J. Rodney Varner, (ii) 1,614,152 shares of common stock held by Laura Lane Biosciences, LLC, and (b) 645,572(iii) 1,800 shares of common stock that Mr. Varner has the right to acquire from us within 60 days of August 1, 2018 pursuant to the exercise of stock options. Mr. Varner holds voting power over the shares held by Laura Lane Biosciences, LLC.

(8)

Consists of 78,008Alizzita Ltd. and (iv) 1,839,804 shares of common stock that Dr. Pham has the right to acquire from us within 60 days of Aguste 1, 2018 pursuant to theissuable upon exercise of stock options.options held by J. Rodney Varner. J. Rodney Varner is the Manager of Laura Lane Biosciences, LLC and the Manager of Alizzita Ltd. and in such capacities has voting and dipositive power over the securities held by such entities.

(9)(3)

Includes 492,521Represents (i) 73,526 shares of common stock that Mr. Confer has the right to acquire from us within 60 days of August 1, 2018 pursuant to the exercise of stock options.

(10)	Consists of 307,111and (ii) 953,396 shares of common stock that Mr. Friedman has the right to acquire from us within 60 days of August 1, 2018 pursuant to theissuable upon exercise of stock options.

(11)(4)

Consists of 307,111Represents (i) 412,860 shares of common stock that Mr. Pearson has the right to acquire from us within 60 daysand (ii) 350,005 shares of August 1, 2018 pursuant to thecommon stock issuable upon exercise of options. This information is based on Company records.

(5)

Represents 240,000 shares of common stock issuable upon exercise of options.

 

(6)

Represents (i) 35,000 shares of common stock and (ii) 53,843 shares of common stock issuable upon exercise of options.

(7)

Represents 53,843 shares of common stock issuable upon exercise of options.

(8)

Represents 53,843 shares of common stock issuable upon exercise of options.

(9)

Represents (i) an aggregate of 2,259,213 shares of common stock and (ii) an aggregate of 3,439,174 shares of common stock issuable upon exercise of options, in each case held by our current executive officers and directors.

 

EXECUTIVE OFFICER AND DIRECTOR COMPENSATION

Our

The following is a discussion of compensation arrangements of our named executive officers (the “Named Executive Officers”). As an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), we are not required to include a Compensation Discussion and Analysis section and have elected to comply with the scaled disclosure requirements applicable to emerging growth companies.

Our Named Executive Officers for the year ended December 31, 2017, which consist of2020 include our principal executive officer, and ourthe next two other most highly compensated executive officers are:

J. Rodney Varner, our Chief Executive Officer;

during the year ended December 31, 2020, and Julien L. Pham, M.D., M.P.H.,who served as our President and Chief Operating Officer;Officer until March 12, 2020, and as our President and Chief Scientific Officer until his resignation from those positions and as an employee of the Company on April 27, 2020. 

 

Ryan M. Confer, our Chief Financial Officer.

Summary Compensation Table

 

Name and Principal Position		Year				Salary ($)				Stock Awards ($)(1)				All other compensation ($)(2)				Total ($)				Year		Salary ($)				Performance Awards ($)				Stock Awards ($)				Option Awards ($)(1)				All Other Compensation ($)(2)				Total ($)
J. Rodney Varner																						2020			487,897				240,000				-				401,695				23,046				1,152,637
Chief Executive Officer			2017				300,000				—				34,069				334,069
Julien L. Pham
President and Chief Operating Officer			2017				285,000				—				16,515				301,515
President & Chief Executive Officer																						2019			400,000				-				-				229,401				29,675				659,076
Ryan M. Confer																						2020			350,884				138,000				-				747,657				33,643				1,270,183
Chief Financial Officer			2017				180,000				388,630				16,492				585,122			2019			300,000				-				-				662,688				41,714				1,004,402
Catherine M. Vaczy (3)																						2020			293,403				121,667				-				199,500				159,361				773,930
Executive Vice President, General Counsel, & Chief Strategy Officer
Julien L. Pham (4)																						2020			282,692				-				-				1,764,618				8,325				2,055,634
Former Chief Operating Officer																						2019			375,000				-				-				1,577,527				14,358				1,966,886

 

(1)

In accordance with SEC rules, this column reflects the aggregate grant date fair value of the stock option awards granted during 2017.2019 and 2018. These amounts have been computed in accordance with FASB ASCFinancial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. Assumptions used in the calculation of these amounts are described in Note 5 to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017.2020. These amounts do not reflect the actual economic value that will be realized by the named executive officerNamed Executive Officer upon the vesting of the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options.

(2)

This column reflects medical and term life insurance premiums paid by us on behalf of each of the named executive officers.Named Executive Officers. The insurance benefits are provided to the named executive officersNamed Executive Officers on the same terms as provided to all of our regular full-time employees. For more information regarding these benefits, see below under “—Perquisites, Health, Welfare and Retirement Benefits.” For Ms. Vaczy, this column also includes amounts received by her during 2020 in her capacity as an Advisor to the Company as well as costs associated with maintaining membership at a NYC-based private club.

(3)	Ms. Vaczy commenced employment with the Company on March 12, 2020.

(4)

Effective as of March 12, 2020, the executive officer title of Julien L. Pham, MD, MPH, was changed to President and Chief Scientific Officer. On April 27, 2020, Dr. Pham resigned his positions as our President and Chief Scientific Officer and as an employee of Genprex. In connection with his resignation, the vesting of options to purchase an aggregate of 410,117 shares of common stock was accelerated and options to purchase an aggregate of 164,837 shares of common stock terminated in accordance with their terms.

Annual Base Salary

The base salary of our named executive officersNamed Executive Officers is generally determined and approved periodically or in connection with the commencement of employment of the executive, by our Board. As of December 31, 2017,2020, base salaries for our named executive officers,Named Executive Officers, which became effective as of OctoberJanuary 1, 20162020 for Mr.J. Rodney Varner, and Mr.Ryan M. Confer and Julien L. Pham, and effective as of October 23, 2016March 12, 2020 for Dr. Pham,Catherine M. Vaczy, are provided below.

 

Name		2020 Base Salary ($)		2017 Base Salary ($)
J. Rodney Varner			300,000 480,000
Julien Pham			285,000
Ryan M. Confer			345,000
Catherine M. Vaczy		180,000	365,000
Julien L. Pham			375,000

 

Bonus Compensation

From time to time our Board or Compensation Committee may approve bonuses for our named executive officersNamed Executive Officers based on individual performance, company performance or as otherwise determined appropriate. In 2017, our executive officers were not entitled to any target or minimum bonus and no specific performance goals or bonus program were established for our named executive officers.

Pursuant to their respective employment agreements, Dr. Pham was, and each of Mr. Varner’s employment agreement, heVarner, Mr. Confer and Ms. Vaczy is, eligible to receive an annual cash bonus upon the achievement of performance objectives mutually agreed between Mr. Varnerthe executive and the Board.

Pursuant to Dr. Pham’s amended and restated employment agreement, he is eligible to receive an annual cash bonus upon the achievement of During 2019, no performance objectives mutuallywere established or agreed upon between Dr. Phamthe Board and our Named Executive Officers. The Board did not award bonuses to any of our Named Executive Officers for 2019. The Board awarded the Board. The amount of the bonusbonuses shown below for 2018 is up to 33.33% of Dr. Pham’s then-current base salary; the amount of the bonus after 2018 will be determined by the Board.2020.

Pursuant to Mr. Confer’s employment agreement, he is eligible to receive an annual cash bonus upon the achievement of performance objectives mutually agreed between Mr. Confer and the Board.

Name		2020 Bonus ($)
J. Rodney Varner			240,000
Ryan M. Confer			138,000
Catherine M. Vaczy			121,667

Equity-Based Incentive Awards

Our equity-based incentive awards are designed to align our interests and those of our stockholders with those of our employees and consultants, including our named executive officers.Named Executive Officers. The Board is responsible for approving equity grants. Stock awards in exchange for servicesoptions were the only form of equity awards we granted to our named executive officersNamed Executive Officers in 2017.2020.

We have historically used stock options as an incentive for long-term compensation to our named executive officersNamed Executive Officers because they are able to profit from stock options only if our stock price increases relative to the stock option’s exercise price, which exercise price is set at no less than the fair market value of our common stock on the date of grant. We may grant equity awards at such times as our Board determines appropriate. Our executives generally are awarded an initial grant in the form of a stock option in connection with their commencement of employment with us. Additional grants may be made periodically in order to specifically incentivize executives with respect to achieving certain corporate goals or to reward executives for exceptional performance.

Prior to the initial public offering of our common stock, we granted all stock options pursuant to our 2009 Equity Incentive Plan. Following our initial public offering, we have granted and will grant equity incentive awards under the terms of our 2018 Equity Incentive Plan.Plan (the “2018 Plan”).

All options are granted with an exercise price per share that is no less than the fair market value of our common stock on the date of grant of such award. Our stock option awards generally vest over a four-yearthree-year period and may be subject to acceleration of vesting and exercisability under certain termination and change in control events. See “—Outstanding Equity Awards at Fiscal Year-End.”

In May 2017,March 2020, the Board granted an awardoption to purchase 540,000 shares to Ms. Vaczy in connection with the commencement of 73,526 sharesher employment with the Company. This option was granted under the 2018 Plan, and has an exercise price of $2.00 per share, the closing price of our common stock as reported on The Nasdaq Capital Market on March 12, 2020, the date of grant. One thirty-sixth of the options vested on March 12, 2020, and one thirty-sixth of the options vest each month following March 12, 2020. In August 2020, the Board granted an option to purchase 530,000 shares to Mr. Confer in consideration of past services.Varner and an option to purchase 270,000 shares to Mr. Confer. Each of these shares had a valueoptions was granted under the 2018 Plan, and each has an exercise price of $5.29$3.80 per share, and was fully vestedthe closing price of our common stock as reported on The Nasdaq Capital Market on August 21, 2020, the date of grant. One thirty-sixth of the options granted to each of Mr. Varner and Mr. Confer vest each month following August 21, 2020.

Securities Authorized for Issuance under Equity Compensation Plans

The following table provides certain information with respect to all of the Company’s equity compensation plans in effect as of December 31, 2020.

		Equity Compensation Plan Information
Plan Category		Number of securities to be issued upon exercise of outstanding options, warrants, and rights (a)				Weighted- average exercise price of outstanding options, warrants and rights (b)				Number of securities remaining available for issuance under equity compensation plans, excluding securities reflected in column (a) (c) (1)
Equity compensation plans approved by security holders:			6,844,072			$	2.81				600,133
Equity compensation plans not approved by security holders (2):			2,092,412			$	4.38				-
Total			8,936,484								600,133

(1)

Includes the 2018 Plan, the 2009 Plan and our 2018 Employee Stock Purchase Plan (the “ESPP”). An aggregate of 208,050 shares under column (c) have been reserved for issuance under the ESPP as of December 31, 2020; however, the ESPP will not become effective until the Board determines to make this benefit available to employees.

(2)

Consists of warrants issued to providers of consulting services to us. Pursuant to agreements entered into with other providers of consulting services to us, we issued an aggregate of 51,432 shares of our common stock in 2020. Pursuant to these agreements, we are obligated to issue to these providers of consulting services additional shares of our common stock, as follows: 5,000 shares per calendar quarter to one provider; and to a second provider; shares having a value of $100,000 each December 4, starting on December 4, 2020, unless we elect to terminate the agreement with that provider. Does not include: (a) warrants to purchase an aggregate of 38,400 shares of our common stock at an exercise price of $6.25 per share issued to the underwriter of our initial public offering in 2018; and (b) warrants to purchase an aggregate of 23,934 shares of our common stock at an exercise price equal to $0.575 per share issued to the placement agent in our registered direct offering in November 2019.

Agreements with Named Executive Officers

Employment Agreement with J. Rodney Varner

We have

In April 2018, we entered into an employment agreement with Mr. Varner, our Chief Executive Officer, which became effective in April 2018, following the closing of the initial public offering of our common stock.Officer. Mr. Varner’s employment under the agreement is at will and may be terminated at any time by us or by him. Under the terms of the agreement, Mr. Varner iswas initially entitled to receive an annual base salary of $350,000. The agreement provides that the Company may pay Mr. Varner a bonus as described above under “—Bonus Compensation” and provides that the Company may grant to Mr. Varner options to purchase shares of our common stock.

The agreement provides that during the term of Mr. Varner’s employment with us and for one year after the termination of his employment, Mr. Varner will not encourage any of our employees or consultants to leave Genprex and will not compete or assist others to compete with us.

If, prior to a change of control, we terminate Mr. Varner’s employment without cause or if Mr. Varner resigns for good reason, and Mr. Varner delivers to us a signed settlement agreement and general release of claims, we are obligated to pay Mr. Varner: (i) a severance payment equal to 18 months of Mr. Varner’s base salary then in effect; (ii) a payment equal to Mr. Varner’s then applicable annual target bonus, calculated at full attainment; (iii) reimbursement of COBRA premium payments made by Mr. Varner for the 12 months following such termination; and (iv) acceleration as to 100% of Mr. Varner’s unvested equity awards from us, subject in the case of (i) and (ii) to our having at least $5 million in cash or cash equivalents and a net worth of at least $5 million on the date of termination.

If, within 12 months following a change of control, Mr. Varner’s employment is terminated without cause or Mr. Varner resigns for good reason, and he delivers to us a signed settlement agreement and general release of claims, we are obligated to pay Mr. Varner: (i) a severance payment equal to 18 months of Mr. Varner’s base salary then in effect; (ii) a payment equal to Mr. Varner’s then applicable target bonus for 18 months, calculated at full attainment; (iii) reimbursement of COBRA premium payments made by Mr. Varner for the 18 months following such termination; and (iv) acceleration as to 100% of Mr. Varner’s unvested equity awards from us, subject in the case of (i) and (ii) to our having at least $5 million in cash or cash equivalents and a net worth of at least $5 million on the date of termination.

For the purposes of Mr. Varner’s employment agreement, “cause” means the occurrence of any of the following events: (i) a determination by our Board that Mr. Varner’s performance is unsatisfactory after there has been delivered to him a written demand for performance which describes the specific deficiencies in his performance and the specific manner in which his performance must be improved, and which provides 30 business days from the date of notice to remedy such performance deficiencies; (ii) Mr. Varner’s conviction of or plea of nolo contendere to a felony or a crime involving moral turpitude which our Board reasonably finds has had or will have a detrimental effect on our reputation or business; (iii) Mr. Varner’s engaging in an act of gross negligence or willful misconduct in the performance of his employment obligations and duties that materially harms us; (iv) Mr. Varner’s committing an act of fraud against, material misconduct or willful misappropriation of property belonging to us; or (v) Mr. Varner’s material breach of his confidentiality, invention assignment and noncompetition agreement with us or of any other unauthorized misuse of our trade secrets or proprietary information.

For purposes of Mr. Varner’s employment agreement, “good reason” means the occurrence of any of the following taken without Mr. Varner’s written consent and conditioned on (a) his providing us with notice of the basis for such resignation for good reason, (b) our failure to cure the event constituting good reason within 30 days after notice and (c) his termination of his employment within 30 days following the expiration of the cure period: (i) a material change in Mr. Varner’s position, titles, offices or duties; (ii) an assignment of any significant duties to Mr. Varner that are inconsistent with his positions or offices held under his employment agreement; (iii) a decrease in Mr. Varner’s then current annual base salary by more than 10% (other than in connection with a general decrease in the salary of all of our other similarly situated employees); or (iv) the relocation of Mr. Varner to a facility or a location more than 50 miles from his then current location.

Amended and Restated Employment Agreement with Julien L. Pham, MD, MPH

On May 23, 2018, we entered into an amended and restated employment agreement with Julien L. Pham, MD, MPH, who was then our President and Chief Operating Officer. This employment agreement amended

Effective as of March 12, 2020, Dr. Pham’s executive officer title was changed to President and restated the employment agreement we had entered into withChief Scientific Officer. On April 27, 2020, Dr. Pham in October 2016.resigned his positions as our President and Chief Scientific Officer and as an employee of Genprex.

Dr. Pham’s employment under the agreement iswas at will and maycould be terminated at any time by us or by him. Under the terms of the agreement, Dr. Pham iswas initially entitled to receive an annual base salary of $325,000. Dr. Pham iswas also entitled to receive a bonus upon the achievement of performance objectives agreed upon between our Board and Dr. Pham. The amount of the bonus for 2018 iswas up to 33.33% of Dr. Pham’s then-current base salary; the amount of the bonus after 2018 willwould be determined by our Board.

On May 23, 2018, we granted Dr. Pham The agreement provided for an initial grant of options to purchase an aggregate of 659,346 shares of our common stock at an exercise priceto Dr. Pham, and provided that the Company could grant to Dr. Pham additional options to purchase shares of $9.80 per share. One-half of the options (the “Time Based Options”) vest based on Dr. Pham’s continued employment, with one-third of these options vesting on May 23, 2019, and the remaining two-thirds vesting in equal quarterly installments over the following two years.  The other one-half of the options vest based on achievement, within time periods specified by our Board, of performance goals specified by our Board.common stock.

The agreement providesprovided that during the term of Dr. Pham’s employment with us and for one year after the termination of his employment, Dr. Pham willwould not encourage any of our employees or consultants to leave Genprex and willwould not compete or assist others to compete with us.

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If, prior to a change of control, we were to terminate Dr. Pham’s employment without cause or if Dr. Pham resignswere to resign for good reason, and Dr. Pham deliversdelivered to us a signed settlement agreement and general release of claims, we arewould have been obligated to pay Dr. Pham: (i) a severance payment equal to 12 months of Dr. Pham’s base salary then in effect; (ii) a payment equal to Dr. Pham’s then applicable annual target bonus, calculated at full attainment; (iii) reimbursement of COBRA premium payments made by Dr. Pham for the 12 months following such termination; and (iv) acceleration as to 100% of Dr. Pham’s Time Based Options, subject in the case of (i) and (ii) to our having at least $5 million in cash or cash equivalents and a net worth of at least $5 million on the date of termination.

If, within 12 months following a change of control, Dr. Pham’s employment iswere terminated without cause or Dr. Pham resignswere to resign for good reason, and he deliversdelivered to us a signed settlement agreement and general release of claims, we arewould have been obligated to pay Dr. Pham: (i) a severance payment equal to 12 months of Dr. Pham’s base salary then in effect; (ii) a payment equal to Dr. Pham’s then applicable annual target bonus, calculated at full attainment; (iii) reimbursement of COBRA premium payments made by Dr. Pham for the 12 months following such termination; and (iv) acceleration as to 100% of Dr. Pham’s unvested equity awards from us, subject in the case of (i) and (ii) to our having at least $5 million in cash or cash equivalents and a net worth of at least $5 million on the date of termination.

For the purposes of Dr. Pham’s employment agreement, “cause” meansmeant the occurrence of any of the following events: (i) a determination by our Board that Dr. Pham’s performance iswas unsatisfactory after there hashad been delivered to him a written demand for performance which describesdescribed the specific deficiencies in his performance and the specific manner in which his performance must be improved, and which providesprovided 30 business days from the date of notice to remedy such performance deficiencies; (ii) Dr. Pham’s conviction of or plea of nolo contendere to a felony or a crime involving moral turpitude which our Board reasonably finds hasfound had or willwould have a detrimental effect on our reputation or business; (iii) Dr. Pham’s engaging in an act of gross negligence or willful misconduct in the performance of his employment obligations and duties that materially harmsharmed us; (iv) Dr. Pham’s committing an act of fraud against, material misconduct or willful misappropriation of property belonging to us; or (v) Dr. Pham’s material breach of his confidentiality, invention assignment and noncompetition agreement with us or of any other unauthorized misuse of our trade secrets or proprietary information.

For purposes of Dr. Pham’s employment agreement, “good reason” meansmeant the occurrence of any of the following taken without Dr. Pham’s written consent and conditioned on (a) his providing us with notice of the basis for such resignation for good reason, (b) our failure to cure the event constituting good reason within 30 days after notice and (c) his termination of his employment within 30 days following the expiration of the cure period: (i) a material change in Dr. Pham’s position, titles, offices or duties other than as provided in the agreement; (ii) an assignment of any significant duties to Dr. Pham that arewere inconsistent with his positions or offices held under his employment agreement; (iii) a decrease in Dr. Pham’s then current annual base salary (other than in connection with a general decrease in the salary of all of our other similarly situated employees); or (iv) the requirement that Dr. Pham relocate his personal residence to a location more than 50 miles from his then current residence.

Separation Agreement with Julien L. Pham, MD, MPH

On April 27, 2020, we entered into a Separation Agreement (the "Separation Agreement") with Julien L. Pham, MD, MPH, in connection with Dr. Pham’s resignation from Genprex. Dr. Pham may revoke the Separation Agreement within a period of seven days after the execution date, after which time if not revoked, the Separation Agreement will become effective (the “Effective Date”). The Separation Agreement includes a general release of any claims of Dr. Pham against the Company and the other Releasees (as defined in the Separation Agreement), including, but not limited to, any claims under Dr. Pham’s Amended and Restated Executive Employment Agreement dated as of May 23, 2018 (the “Employment Agreement”) with the Company.

As consideration for the general release, and subject to Dr. Pham’s continued compliance with the terms and conditions of the Separation Agreement and the restrictive covenants contained in the Employment Agreement and the Confidential Information, Assignment of Inventions and Noncompetition Agreement attached as Exhibit A to the Employment Agreement (the “Confidentiality Agreement”), Dr. Pham will be entitled to receive the following: (i) payment of five months of Dr. Pham’s base salary of $375,000, or an aggregate of $156,250, subject to applicable withholding and payable in installments in accordance the Company’s normal payroll practices; (ii) reimbursement for five months of insurance coverage under the Consolidated Omnibus Budget Reconciliation Act, if incurred; (iii) accelerated vesting of stock options with time-based vesting that would have vested had Dr. Pham remained employed with the Company, with the total number of shares for which such newly vested options are exercisable being 410,117; and (iv) a release of any claims of the Company against Dr. Pham.

Under the Separation Agreement, during the five months following the Effective Date, Dr. Pham agreed to provide up to two hours per week of consultation services relating to the transition of his duties, if and as requested by the Company, for which the Company would compensate him at a rate of $500 per hour.  Also under the Separation Agreement, stock options with respect to 164,837 shares with vesting based on achievement of milestones will be forfeited. The Separation Agreement also contains customary provisions relating to, among other things, return of Company property and information and reaffirmation of Dr. Pham’s ongoing obligations under the Employment Agreement and the Confidentiality Agreement.

Employment Agreement with Ryan M. Confer

We have

In April 2018, we entered into an employment agreement with Mr. Confer, our Chief Financial Officer, which became effective in April 2018, following the closing of the initial public offering of our common stock.Officer. Mr. Confer’s employment under the agreement is at will and may be terminated at any time by us or by him. Under the terms of the agreement, Mr. Confer iswas initially entitled to receive an annual base salary of $240,000. The agreement provides that the Company may pay Mr. Confer a bonus as described above under “—Bonus

Compensation” and provides that the Company may grant to Mr. Confer options to purchase shares of our common stock.

The agreement provides that during the term of Mr. Confer’s employment with us and for one year after the termination of his employment, Mr. Confer will not encourage any of our employees or consultants to leave Genprex and will not compete or assist others to compete with us.

If we terminate Mr. Confer’ employment without cause or if Mr. Confer resigns for good reason, and Mr. Confer delivers to us a signed settlement agreement and general release of claims, we are obligated to pay Mr. Confer: (i) a severance payment equal to 12 months of Mr. Confer’ base salary then in effect; (ii) a payment equal to Mr. Confer’s then applicable annual target bonus, calculated at full attainment; (iii) reimbursement of COBRA premium payments made by Mr. Confer for the 12 months following such termination; and (iv) acceleration as to 100% of Mr. Confer’s unvested equity awards from us, subject in the case of (i) and (ii) to our having at least $5 million in cash or cash equivalents and a net worth of at least $5 million on the date of termination.

For the purposes of Mr. Confer’s employment agreement, “cause” means the occurrence of any of the following events: (i) a determination by our Board that Mr. Confer’s performance is unsatisfactory after there has been delivered to him a written demand for performance which describes the specific deficiencies in his performance and the specific manner in which his performance must be improved, and which provides 30 business days from the date of notice to remedy such performance deficiencies; (ii) Mr. Confer’s conviction of or plea of nolo contendere to a felony or a crime involving moral turpitude which our Board reasonably finds has had or will have a detrimental effect on our reputation or business; (iii) Mr. Confer’s engaging in an act of gross negligence or willful misconduct in the performance of his employment obligations and duties that materially harms us; (iv) Mr. Confer’s committing an act of fraud against, material misconduct or willful misappropriation of property belonging to us; or (v) Mr. Confer’s material breach of his confidentiality, invention assignment and noncompetition agreement with us or of any other unauthorized misuse of our trade secrets or proprietary information.

For purposes of Mr. Confer’s employment agreement, “good reason” means the occurrence of any of the following taken without Mr. Confer’s written consent and conditioned on (a) his providing us with notice of the basis for such resignation for good reason, (b) our failure to cure the event constituting good reason within 30 days after notice and (c) his termination of his employment within 30 days following the expiration of the cure period: (i) a material change in Mr. Confer’s position, titles, offices or duties; (ii) an assignment of any significant duties to Mr. Confer that are inconsistent with his positions or offices held under his employment agreement; (iii) a decrease in Mr. Confer’s then current annual base salary by more than 10% (other than in connection with a general decrease in the salary of all of our other similarly situated employees); or (iv) the relocation of Mr. Confer to a facility or a location more than 50 miles from his then current location.

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Employment Agreement with Catherine M. Vaczy

On March 12, 2020, in connection with the appointment of Ms. Vaczy as our Executive Vice President and Chief Strategy Officer, we entered into an employment agreement with Ms. Vaczy that governs the terms of her employment with us.

Ms. Vaczy’s employment under the agreement is at will and may be terminated at any time by us or by her. Under the terms of the agreement, Ms. Vaczy is initially entitled to receive an annual base salary of $365,000. Ms. Vaczy is also entitled to receive a bonus upon the achievement of performance objectives agreed upon between our Board of Directors and Ms. Vaczy.

The agreement provides that for twelve months after the termination of her employment, Ms. Vaczy will not encourage any of our employees or consultants to leave Genprex and that during the term of Ms. Vaczy’s employment with us and for six months after the termination of her employment, Ms. Vaczy will not compete or assist others to compete with us.

If we terminate Ms. Vaczy’s employment without cause or if Ms. Vaczy resigns for good reason, in either case before a change of control or within twelve months following a change of control, and Ms. Vaczy delivers to us a signed settlement agreement and general release of claims, we are obligated to pay Ms. Vaczy: (i) a severance payment equal to six months of Ms. Vaczy’s base salary then in effect; (ii) a payment equal to one-half of Ms. Vaczy’s then applicable annual target bonus (provided that any portion of the target bonus that relates to performance criteria that have been achieved shall be calculated at full attainment); (iii) reimbursement of COBRA premium payments made by Ms. Vaczy for the six months following such termination; and (iv) acceleration as to 100% of Ms. Vaczy’s unvested equity awards from us, subject in the case of (i) and (ii) to our having at least $5 million in cash or cash equivalents and a net worth of at least $5 million on the date of termination.

For the purposes of Ms. Vaczy’s employment agreement, “cause” means the occurrence of any of the following events: (i) a determination by our Board of Directors that Ms. Vaczy’s performance is unsatisfactory after there has been delivered to her a written demand for performance which describes the specific deficiencies in her performance and the specific manner in which her performance must be improved, and which provides 30 business days from the date of notice to remedy such performance deficiencies; (ii) Ms. Vaczy’s conviction of or plea of nolo contendere to a felony or a crime involving moral turpitude which our Board of Directors reasonably finds has had or will have a detrimental effect on our reputation or business; (iii) Ms. Vaczy’s engaging in an act of gross negligence or willful misconduct in the performance of her employment obligations and duties that materially harms us; (iv) Ms. Vaczy’s committing an act of fraud against, material misconduct or willful misappropriation of property belonging to us; or (v) Ms. Vaczy’s material breach of her confidentiality, invention assignment and noncompetition agreement with us or of any other unauthorized misuse of our trade secrets or proprietary information.

For purposes of Ms. Vaczy’s employment agreement, “good reason” means the occurrence of any of the following taken without Ms. Vaczy’s written consent and conditioned on (a) her providing us with notice of the basis for such resignation for good reason, (b) our failure to cure the event constituting good reason within 30 days after notice and (c) her termination of her employment within 30 days following the expiration of the cure period: (i) a material change in Ms. Vaczy’s position, titles, offices or duties; (ii) an assignment of any significant duties to Ms. Vaczy that are inconsistent with her positions or offices held under her employment agreement; (iii) a decrease in Ms. Vaczy’s then current annual base salary by more than 10% (other than in connection with a general decrease in the salary of all of our other similarly situated employees); or (iv) the relocation of Ms. Vaczy to a facility or a location more than 50 miles from her then current location.

Any potential payments and benefits due upon a qualifying termination of employment or a change in control are further described below under “—Potential Payments and Benefits upon Termination or Change in Control.”

Potential Payments and Benefits upon Termination or Change in Control

Regardless of the manner in which a named executive officer’sNamed Executive Officer’s service terminates, each named executive officerNamed Executive Officer is entitled to receive amounts earned during his term of service, including unpaid salary. In addition, Dr. Pham was, and each of Mr. Varner, Dr. PhamMr. Confer and Mr. ConferMs. Vaczy is, entitled to receive certain benefits upon our termination of his or her employment without cause or upon his or her resignation for good reason, and Mr. Varner is entitled to receive certain additional benefits upon such a termination or resignation within 12 months after a change of control, all as provided above under “—Agreements with Named Executive Officers.”

Each of our named executive officersNamed Executive Officers holds stock options that were granted subject to the general terms and termination and change in control provisions of our 2009 Equity Incentive Plan and beginning in April 2018, our 2018 Equity Incentive Plan. A description of the termination and change in control provisions in our 2009 Plan andand/or 2018 Plan and applicable to the stock options granted to our named executive officersNamed Executive Officers is provided below under “—Equity Benefit Plans” and “—Outstanding Equity Awards at Fiscal Year-End” and above under “—Equity-Based Incentive Awards.”

Outstanding Equity Awards at FiscalYear-End

The following table sets forth certain information regarding equity awards granted to our named executive officersNamed Executive Officers that were outstanding as of December 31, 2017.2020.

 

		Option Awards(1)																								Option Awards (1)
Name		Grant Date				Number of securities underlying unexercised option (#) exercisable				Number of securities underlying unexercised option (#) unexercisable								Option exercise price ($)(2)				Option expiration date				Grant Date		Number of securities underlying unexercised option (#) exercisable				Number of securities underlying unexercised option (#) unexercisable				Option exercise price ($)(2)			Option expiration date
J. Rodney Varner			4/11/2016				645,572				—							$	0.96				4/11/2026			4/11/2016			645,572				—			$	0.96		4/10/2026
Julien Pham			11/3/2016				47,483				115,317				(3)			$	5.29				11/3/2026
																										11/2/2018			551,284				—			$	2.15		11/1/2028
																										1/27/2019			393,162				222,222	(3)		$	1.62		1/26/2029
																										8/21/2020			58,888				471,038	(4)		$	3.80		8/20/2030
Ryan Confer			7/25/2012				116,973				—							$	0.01				7/25/2022			7/25/2012			116,973				—			$	0.01		7/24/2022
			4/11/2016				161,396				—							$	0.96				4/11/2026			4/11/2016			161,396				—			$	0.96		4/10/2026
			11/3/2016				86,894				—							$	5.29				11/3/2026			11/3/2016			86,894				—			$	5.29		11/2/2026
																										5/23/2018			290,876				36,360	(5)		$	9.80		5/22/2028
																										1/27/2019			147,436				83,333	(6)		$	1.62		1/26/2029
																										8/21/2020			30,000				240,000	(7)		$	3.80		8/20/2030
Catherine Vaczy																										3/12/2020			150,000				390,000	(8)		$	2.00		3/11/2030
Julien Pham																										5/23/2018			329,673				—			$	9.80		5/22/2028
																										1/27/2019			165,692				—			$	1.62		1/26/2029

 

(1)

All of the outstanding stock option awards were granted under and subject to the terms of our 2009 Equity Incentive Plan.Plan or our 2018 Equity Incentive Plan, as applicable, described below under “-- Equity Benefit Plans”. As of December 31, 2017,2020, each option award becomes exercisable as it becomes vested and all vesting is subject to the executive’s continuous service with us through the vesting dates and the potential vesting acceleration described above under “—Potential Payments and Benefits upon Termination or Change in Control.”

 

(2)	All of the stock option awards were granted with a per share exercise price no less than the fair market value of one share of our common stock on the date of grant, as determined in good faith by our Board.

 

(3)	3,39217,094 shares will vest each month until October 25, 2020.January 14, 2022.

(4)	14,722 shares will vest each month until August 21, 2023.

(5)	109,064 shares vested on May 23, 2018, and 18,181 shares will vest every quarter thereafter ending on May 23, 2021.

(6)	6,410 shares will vest each month until January 12, 2022.

(7)	7,500 shares will vest each month until August 21, 2023.

(8)	15,000 shares will vest each month until February 12, 2023.

 

Option Repricings

 

We did not engage in any repricings or other modifications or cancellations of any of our named executive officers’Named Executive Officers’ outstanding equity awards during the fiscal year ended December 31, 2017.2020.

 

Perquisites, Health, Welfare and Retirement Benefits

Our named executive officers,Named Executive Officers, during their employment with us, are eligible to participate in our employee benefit plans, including our medical, dental, vision, employee whole life, disability and accidental death and dismemberment insurance plans, in each case on the same basis as all of our other employees. We do not provide a 401(k) plan to our employees at this time.

We generally do not provide perquisites or personal benefits to our named executive officers,Named Executive Officers, except in limited circumstances. We do, however, pay the premiums for medical, dental, vision, employee whole life, disability and accidental death and dismemberment insurance for all of our employees, including our named executive officers.Named Executive Officers. Our Board may elect to adopt qualified or nonqualified benefit plans in the future if it determines that doing so is in our best interests.

Nonqualified Deferred Compensation

We do not maintain nonqualified defined contribution plans or other nonqualified deferred compensation plans. Our Board may elect to provide our officers and other employees with nonqualified defined contribution or other nonqualified deferred compensation benefits in the future if it determines that doing so is in our best interests.

Prohibition Against Speculative Trading

Our insider trading policy prohibits our officers, directors, other employees or consultants from engaging in short sales, transactions in put or call options, hedging transactions or other inherently speculative transactions with respect to our stock at any time. In addition, none of our executives, directors, other employees or consultants may margin, or make any offer to margin, or otherwise pledge as security, any of our stock, including without limitation, borrowing against such stock, at any time.

Equity Benefit Plans

2018 Equity Incentive Plan

The

Our Board and stockholders approved and adopted our 2018 Equity Incentive Plan in April 2018. The 2018 Plan became effective on April 3, 2018, upon the closing of the initial public offering of our common stock. After such date, noNo further grants will be made under the 2009 Plan.

Stock Awards. The 2018 Plan provides for the grant of incentive stock options, or ISOs, nonstatutory stock options, or NSOs, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance based stock awards, and other forms of equity compensation, which we refer to collectively as stock awards. Additionally, the 2018 Plan provides for the grant of performance cash awards. ISOs may be granted only to employees. All other awards may be granted to employees, including officers, and to non-employee directors and consultants of us and our affiliates.

Share Reserve. Initially, the aggregate number of shares of our common stock that may be issued pursuant to stock awards under the 2018 Plan iswas 6,788,749 shares, which is the sum of (1) 3,605,037 new shares, plus (2) 554,963 shares reserved for issuance under our 2009 Plan at the time our 2018 Plan became effective, plus (3) up to 2,628,749 shares subject to outstanding stock options or other stock awards that would have otherwise returned to our 2009 Plan (such as upon the expiration or termination of a stock award prior to vesting). Additionally, the

The number of shares of our common stock reserved for issuance under our 2018 Plan will automatically increase on January 1 of each year, beginning on January 1, 2019 and continuing through and including January 1, 2028, by 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our Board. Accordingly, on January 1, 2020, the number of shares of our common stock reserved for issuance under our 2018 Plan automatically increased by 963,192 shares of our common stock. As of December 31, 2020, stock options granted under our 2009 Plan covering a total of 1,714,130 shares, and stock options granted under our 2018 Plan covering a total of 5,129,942 shares were outstanding, and a total of 392,083 shares remained available for issuance under our 2018 Plan. The maximum number of shares that may be issued upon the exercise of ISOs under our 2018 Plan is 8,320,000 shares.

No person may be granted stock awards covering more than 1,040,000 shares of our common stock under our 2018 Plan during any calendar year pursuant to stock options, stock appreciation rights and other stock awards whose value is determined by reference to an increase over an exercise or strike price of at least 100% of the fair market value on the date the stock award is granted. Additionally, no person may be granted in a calendar year a performance stock award covering more than 2,080,000 shares or a performance cash award having a maximum value in excess of $2,000,000. Such limitations are designed to help assure that any deductions to which we would otherwise be entitled with respect to such awards will not be subject to the $1,000,000 limitation on the income tax deductibility of compensation paid to any covered executive officer imposed by Section 162(m) of the Code. In addition, the maximum number of shares of our common stock subject to stock awards granted under the 2018 Plan during any one calendar year to any non-employee director will not exceed $1,000,000 in total value, or, with respect to the calendar year in which a non-employee director is first appointed or elected to our Board, $2,000,000.

If a stock award granted under the 2018 Plan expires or otherwise terminates for any reason prior to exercise or settlement, the shares of our common stock not acquired pursuant to the stock award again will become available for subsequent issuance under the 2018 Plan. In addition, the following types of shares under the 2018 Plan may become available for the grant of new stock awards under the 2018 Plan: (1) shares that are forfeited to or repurchased by us prior to becoming fully vested; (2) shares withheld to satisfy income or employment withholding taxes; or (3) shares used to pay the exercise or purchase price of a stock award. Shares issued under the 2018 Plan may be previously unissued shares or reacquired shares bought by us on the open market. As of the date hereof, no awards have been granted and no shares of our common stock have been issued under the 2018 Plan.

Administration. Our Board, or a duly authorized committee thereof, has the authority to administer the 2018 Plan. Our Board may also delegate to one or more of our officers the authority to (1) designate employees (other than officers) to be recipients of certain stock awards, and (2) determine the number of shares of common stock to be subject to such stock awards. Subject to the terms of the 2018 Plan, our Board or the authorized committee, referred to herein as the plan administrator, determines recipients, dates of grant, the numbers and types of stock awards to be granted and the terms and conditions of the stock awards, including the period of their exercisability and vesting schedule applicable to a stock award. Subject to the limitations set forth below, the plan administrator will also determine the exercise price, strike price or purchase price of awards granted and the types of consideration to be paid for the award.

The plan administrator has the authority to modify outstanding awards under our 2018 Plan. Subject to the terms of our 2018 Plan, the plan administrator has the authority to reduce the exercise, purchase or strike price of any outstanding stock award, cancel any outstanding stock award in exchange for new stock awards, cash or other consideration, or take any other action that is treated as a repricing under generally accepted accounting principles, with the consent of any adversely affected participant.

Stock Options. ISOs and NSOs are granted pursuant to stock option agreements adopted by the plan administrator. The plan administrator determines the exercise price for a stock option, within the terms and conditions of the 2018 Plan, provided that the exercise price of a stock option generally cannot be less than 100% of the fair market value of our common stock on the date of grant. Options granted under the 2018 Plan vest at the rate specified by the plan administrator.

The plan administrator determines the term of stock options granted under the 2018 Plan, up to a maximum of 10 years. Unless the terms of an optionholder’s stock option agreement provide otherwise, if an optionholder’s service relationship with us, or any of our affiliates, ceases for any reason other than disability, death or cause, the optionholder may generally exercise any vested options for a period of three months following the cessation of service. The option term may be extended in the event that exercise of the option following such a termination of service is prohibited by applicable securities laws or our insider trading policy. If an optionholder’s service relationship with us or any of our affiliates ceases due to disability or death, or an optionholder dies within a certain period following cessation of service, the optionholder or a beneficiary may generally exercise any vested options for a period of 12 months in the event of disability and 18 months in the event of death. In the event of a termination for cause, all options generally terminate immediately upon the termination of the individual for cause. In no event may an option be exercised beyond the expiration of its term.

Acceptable consideration for the purchase of common stock issued upon the exercise of a stock option will be determined by the plan administrator and may include (1) cash, check, bank draft or money order, (2) a broker-assisted cashless exercise, (3) the tender of shares of our common stock previously owned by the optionholder, (4) a net exercise of the option if it is an NSO, and (5) other legal consideration approved by the plan administrator.

Unless the plan administrator provides otherwise, options generally are not transferable except by will, the laws of descent and distribution, or pursuant to a domestic relations order. An optionholder may designate a beneficiary, however, who may exercise the option following the optionholder’s death.

Tax Limitations on Incentive Stock Options. The aggregate fair market value, determined at the time of grant, of our common stock with respect to ISOs that are exercisable for the first time by an optionholder during any calendar year under all of our stock plans and the stock plans of any of our affiliates may not exceed $100,000. Options or portions thereof that exceed such limit will generally be treated as NSOs. No ISO may be granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of our total combined voting power or that of any of our affiliates unless (1) the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant, and (2) the term of the ISO does not exceed five years from the date of grant.

Restricted Stock Awards. Restricted stock awards are granted pursuant to restricted stock award agreements adopted by the plan administrator. Restricted stock awards may be granted in consideration for (1) cash, check, bank draft or money order, (2) services rendered to us or our affiliates, or (3) any other form of legal consideration. Common stock acquired under a restricted stock award may, but need not, be subject to a share repurchase option in our favor in accordance with a vesting schedule to be determined by the plan administrator. A restricted stock award may be transferred only upon such terms and conditions as set by the plan administrator. Except as otherwise provided in the applicable award agreement, restricted stock that has not vested will be forfeited or repurchased by us upon the participant’s cessation of continuous service for any reason.

Restricted Stock Unit Awards. Restricted stock unit awards are granted pursuant to restricted stock unit award agreements adopted by the plan administrator. Restricted stock unit awards may be granted in consideration for any form of legal consideration. A restricted stock unit award may be settled by cash, delivery of stock, a combination of cash and stock as deemed appropriate by the plan administrator, or in any other form of consideration set forth in the restricted stock unit award agreement. Additionally, dividend equivalents may be credited in respect of shares covered by a restricted stock unit award. Except as otherwise provided in the applicable

award agreement, restricted stock units that have not vested will be forfeited upon the participant’s cessation of continuous service for any reason.

Stock Appreciation Rights. Stock appreciation rights are granted pursuant to stock appreciation grant agreements adopted by the plan administrator. The plan administrator determines the strike price for a stock appreciation right, which generally cannot be less than 100% of the fair market value of our common stock on the date of grant. Upon the exercise of a stock appreciation right, we will pay the participant an amount equal to the product of (1) the excess of the per share fair market value of our common stock on the date of exercise over the strike price, multiplied by (2) the number of shares of common stock with respect to which the stock appreciation right is exercised. A stock appreciation right granted under the 2018 Plan vests at the rate specified in the stock appreciation right agreement as determined by the plan administrator.

The plan administrator determines the term of stock appreciation rights granted under the 2018 Plan, up to a maximum of 10 years. Unless the terms of a participant’s stock appreciation right agreement provides otherwise, if a participant’s service relationship with us or any of our affiliates ceases for any reason other than cause, disability or death, the participant may generally exercise any vested stock appreciation right for a period of three months following the cessation of service. The stock appreciation right term may be further extended in the event that exercise of the stock appreciation right following such a termination of service is prohibited by applicable securities laws. If a participant’s service relationship with us, or any of our affiliates, ceases due to disability or death, or a participant dies within a certain period following cessation of service, the participant or a beneficiary may generally exercise any vested stock appreciation right for a period of 12 months in the event of disability and 18 months in the event of death. In the event of a termination for cause, stock appreciation rights generally terminate immediately upon the occurrence of the event giving rise to the termination of the individual for cause. In no event may a stock appreciation right be exercised beyond the expiration of its term.

Performance Awards. The 2018 Plan permits the grant of performance-based stock and cash awards that may qualify as performance-based compensation that is not subject to the $1,000,000 limitation on the income tax deductibility of compensation paid to a covered executive officer imposed by Section 162(m) of the Code. To help assure that the compensation attributable to performance-based awards will so qualify, our Compensation Committee can structure such awards so that stock or cash will be issued or paid pursuant to such award only after the achievement of certain pre-established performance goals during a designated performance period.

The performance goals that may be selected include one or more of the following: (1) earnings (including earnings per share and net earnings); (2) earnings before interest, taxes and depreciation; (3) earnings before interest, taxes, depreciation and amortization; (4) earnings before interest, taxes, depreciation, amortization and legal settlements; (5) earnings before interest, taxes, depreciation, amortization, legal settlements and other income (expense); (6) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense) and stock-based compensation; (7) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense), stock-based compensation and changes in deferred revenue; (8) earnings before interest, taxes, depreciation, amortization, legal settlements, other income (expense), stock-based compensation, other non-cash expenses and changes in deferred revenue; (9) total stockholder return; (10) return on equity or average stockholder’s equity; (11) return on assets, investment, or capital employed; (12) stock price; (13) margin (including gross margin); (14) income (before or after taxes); (15) operating income; (16) operating income after taxes; (17) pre-tax profit; (18) operating cash flow; (19) sales or revenue targets; (20) increases in revenue or product revenue; (21) expenses and cost reduction goals; (22) improvement in or attainment of working capital levels; (23) economic value added (or an equivalent metric); (24) market share; (25) cash flow; (26) cash flow per share; (27) cash balance; (28) cash burn; (29) cash collections; (30) share price performance; (31) debt reduction; (32) implementation or completion of projects or processes (including, without limitation, discovery of a preclinical drug candidate, recommendation of a drug candidate to enter a clinical trial, clinical trial initiation, clinical trial enrollment and dates, clinical trial results, regulatory filing submissions (such as IND, BLA and NDA), regulatory filing acceptances, regulatory or advisory committee interactions, regulatory approvals, and product supply); (33) stockholders’ equity; (34) capital expenditures; (35) financings; (36) operating profit or net operating profit; (37) workforce diversity; (38) growth of net income or operating income; (39) employee retention; (40) initiation of studies by specific dates; (41) budget management; (42) submission to, or approval by, a regulatory body (including, but not limited to the FDA) of an applicable filing or a product; (43) regulatory milestones; (44) progress of internal research or development programs; (45) progress of partnered programs; (46) partner satisfaction; (47) timely

completion of clinical trials; (48) milestones related to research development (including, but not limited to, preclinical and clinical studies), product development and manufacturing; (49) expansion of sales in additional geographies or markets; (50) research progress, including the development of programs; (51) strategic partnerships or transactions (including in-licensing and out-licensing of intellectual property; (52) filing of patent applications and granting of patents; and (53) and to the extent that an award is not intended to comply with Section 162(m) of the Code, other measures of performance selected by our Board.

The performance goals may be based on a company-wide basis, with respect to one or more business units, divisions, affiliates, or business segments, and in either absolute terms or relative to the performance of one or more comparable companies or the performance of one or more relevant indices. Unless specified otherwise (1) in the award agreement at the time the award is granted or (2) in any other document setting forth the performance goals at the time the goals are established, we will appropriately make adjustments in the method of calculating the attainment of performance goals as follows: (a) to exclude restructuring and/or other nonrecurring charges; (b) to exclude exchange rate effects; (c) to exclude the effects of changes to generally accepted accounting principles; (d) to exclude the effects of any statutory adjustments to corporate tax rates; (e) to exclude the effects of any “items of an unusual nature or of infrequency of occurrence or non-recurring items” as determined under generally accepted accounting principles; (f) to exclude the dilutive effects of acquisitions or joint ventures; (g) to assume that any business divested by us achieved performance objectives at targeted levels during the balance of a performance period following such divestiture; (h) to exclude the effect of any change in the outstanding shares of our common stock by reason of any stock dividend or split, stock repurchase, reorganization, recapitalization, merger, consolidation, spin-off, combination or exchange of shares or other similar corporate change, or any distributions to common stockholders other than regular cash dividends; (i) to exclude the effects of stock based compensation and the award of bonuses under our bonus plans; (j) to exclude costs incurred in connection with potential acquisitions or divestitures that are required to be expensed under generally accepted accounting principles; (k) to exclude the goodwill and intangible asset impairment charges that are required to be recorded under generally accepted accounting principles; (l) to exclude the effect of any other unusual, non-recurring gain or loss or other extraordinary item; and (m) to exclude the effects of the timing of acceptance for review and/or approval of submissions to the FDA or any other regulatory body. In addition, we retain the discretion to reduce or eliminate the compensation or economic benefit due upon attainment of the goals. The performance goals may differ from participant to participant and from award to award.

Other Stock Awards. The plan administrator may grant other awards based in whole or in part by reference to our common stock. The plan administrator will set the number of shares under the stock award and all other terms and conditions of such awards.

Changes to Capital Structure. In the event that there is a specified type of change in our capital structure, such as a stock split or recapitalization, appropriate adjustments will be made to (1) the class and maximum number of shares reserved for issuance under the 2018 Plan, (2) the class and maximum number of shares by which the share reserve may increase automatically each year, (3) the class and maximum number of shares that may be issued upon the exercise of ISOs, (4) the class and maximum number of shares subject to stock awards that can be granted to any person in a calendar year (as established under the 2018 Plan pursuant to Section 162(m) of the Code), and (5) the class and number of shares and exercise price, strike price, or purchase price, if applicable, of all outstanding stock awards.

Corporate Transactions. In the event of certain specified significant corporate transactions (or a change in control, as described below), the plan administrator has the discretion to take any of the following actions with respect to stock awards:

arrange for the assumption, continuation or substitution of a stock award by a surviving or acquiring entity or parent company;

arrange for the assignment of any reacquisition or repurchase rights held by us to the surviving or acquiring entity or parent company;

accelerate the vesting of the stock award and provide for its termination prior to the effective time of the transaction;

arrange for the lapse of any reacquisition or repurchase right held by us;

•

arrange for the lapse of any reacquisition or repurchase right held by us;

cancel or arrange for the cancellation of the stock award in exchange for such cash consideration, if any, as our Board may deem appropriate; or

make a payment equal to the excess of (a) the value of the property the participant would have received upon exercise of the stock award immediately prior to the effective time of the transaction, over (b) the exercise price otherwise payable by the participant in connection with such exercise.

Our plan administrator is not obligated to treat all stock awards, even those that are of the same type, in the same manner.

Under the 2018 Plan, a corporate transaction is generally the consummation of (1) a sale or other disposition of all or substantially all of our assets, (2) a sale or other disposition of more than 50% of our outstanding securities, (3) a merger, consolidation or similar transaction following which we are not the surviving corporation, or (4) a merger, consolidation or similar transaction following which we are the surviving corporation but the shares of our common stock outstanding immediately prior to such transaction are converted or exchanged into other property by virtue of the transaction.

Change in Control. In addition to the above, the plan administrator may provide, in an individual award agreement or in any other written agreement between a participant and us that the stock award will be subject to additional acceleration of vesting and exercisability in the event of a change in control. Under the 2018 Plan, a change in control is generally (1) the acquisition by a person or entity of more than 50% of our combined voting power other than by merger, consolidation or similar transaction; (2) a consummated merger, consolidation or similar transaction immediately after which our stockholders cease to own more than 50% of the combined voting power of the surviving entity (or its parent); (3) a consummated sale, lease, exclusive license or other disposition of all or substantially of our assets; (4) a complete dissolution or liquidation of the Company, except for a liquidation into a parent corporation; or (5) when a majority of our Board becomes comprised of individuals who were not serving on our Board on the date of adoption of the 2018 Plan, or the incumbent board, or whose nomination, appointment, or election was not approved by a majority of the incumbent board then still in office.

Amendment and Termination. Our Board has the authority to amend, suspend, or terminate our 2018 Plan, provided that such action does not impair the existing rights of any participant without such participant’s written consent. No ISOs may be granted after the 10th anniversary of the date our Board adopted our 2018 Plan.

2009 Equity Incentive Plan

Our Board and our stockholders approved our 2009 Equity Incentive Plan in November 2009. The 2009 Plan was subsequently amended by our Board and stockholders, most recently in August 2012. As of February 28, 2018, there were 554,963 shares remaining available for the grant of stock awards under our 2009 Plan andDecember 31, 2020, there were outstanding stock options covering a total of 2,628,7491,714,130 shares that were granted under our 2009 Plan and no additional shares available for grant under the 2009 Plan.

No additional awards will be granted under the 2009 Plan, and all outstanding awards granted under the 2009 Plan that are repurchased, forfeited, expire or are canceled will become available for grant under the 2018 Plan in accordance with its terms.

Stock awards. The 2009 Plan provides for the grant of ISOs, NSOs, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance stock awards and other stock awards, or collectively, stock awards. With the exception of ISOs, all stock awards may be granted to employees, including officers, and to our non-employee directors and consultants and those of our affiliates. ISOs may be granted only to employees. We have only granted stock options under the 2009 Plan.

Share Reserve. The aggregate number of shares of our common stock reserved for issuance pursuant to awards under the 2009 Plan is 2,628,749.

If a stock award granted under the 2009 Plan is forfeited to us or repurchased by us because of the failure to meet a contingency or condition required for vesting, such shares will become available for subsequent issuance

under the 2018 Plan. In addition, shares withheld to satisfy income or employment withholding taxes and shares used to pay the exercise price of a stock option will become available for the grant of new stock awards under the 2018 Plan. Shares issued under the 2009 Plan may be authorized but unissued or reacquired common stock.

Administration. Our Board, or a duly authorized committee thereof, has the authority to administer the 2009 Plan. Subject to the terms of the 2009 Plan, our Board or the authorized committee, referred to herein as the plan administrator, determines recipients, dates of grant, the numbers and types of stock awards to be granted and the terms and conditions of the stock awards, including the period of their exercisability and vesting schedule applicable to a stock award. Subject to the limitations set forth below, the plan administrator will also determine the exercise price, strike price or purchase price of awards granted and the types of consideration to be paid for the award.

The plan administrator has the authority to modify outstanding awards under our 2009 Plan. Subject to the terms of our 2009 Plan, the plan administrator has the authority to reduce the exercise price of any outstanding stock option, cancel any outstanding stock option in exchange for new stock awards, cash or other consideration, or take any other action that is treated as a repricing under generally accepted accounting principles, with the consent of any adversely affected participant.

Stock Options. ISOs and NSOs are granted pursuant to stock option agreements adopted by the plan administrator. The plan administrator determines the exercise price for a stock option, within the terms and conditions of the 2009 Plan, provided that the exercise price of a stock option generally cannot be less than 100% of the fair market value of our common stock on the date of grant. Options granted under the 2009 Plan vest at the rate specified by the plan administrator.

The plan administrator determines the term of stock options granted under the 2009 Plan, up to a maximum of 10 years. Unless the terms of an optionholder’s stock option agreement provide otherwise, if an optionholder’s service relationship with us, or any of our affiliates, ceases for any reason other than disability or death, the optionholder may generally exercise any vested options for a period of three months following the cessation of service, with respect to employee optionholders. The option term may be extended in the event that exercise of the option following such a termination of service is prohibited by applicable securities laws. If an optionholder’s service relationship with us or any of our affiliates ceases due to death, or an optionholder dies within a certain period following cessation of service, the optionholder or a beneficiary may generally exercise any vested options for a period of 12 months following the date of death. If an optionholder’s service relationship with us or any of our affiliates ceases due to disability, the optionholder may generally exercise any vested options for a period of 12 months following the cessation of service. In no event may an option be exercised beyond the expiration of its term.

Acceptable consideration for the purchase of common stock issued upon the exercise of a stock option will be as determined by the plan administrator.

Unless the plan administrator provides otherwise, options generally are not transferable except by will or by the laws of descent and distribution.

Tax Limitations on Incentive Stock Options. The aggregate fair market value, determined at the time of grant, of our common stock with respect to ISOs that are exercisable for the first time by an optionholder during any calendar year under all of our stock plans may not exceed $100,000. Options or portions thereof that exceed such limit will generally be treated as NSOs. No ISO may be granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of our total combined voting power or that of any of our affiliates unless (1) the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant, and (2) the option is not exercisable after the expiration of five years from the date of grant.

Changes to Capital Structure. In the event that there is a specified type of change in our capital structure, such as a stock split or recapitalization, appropriate adjustments will be made to (a) the class and maximum number of shares reserved for issuance under the 2009 Plan, (b) the class and maximum number of shares that may be issued upon the exercise of ISOs, and (c) the class and number of shares and price per share of stock subject to all outstanding stock awards.

Corporate Transactions. In the event of a change in control, unless otherwise provided in a stock award or other written agreement between us and the holder of a stock award, each stock award will be treated as the plan administrator determines, arranging for the assumption or substitution of a stock award by a successor entity. If the successor entity does not assume or substitute for the stock award, the vesting and exercisability, if applicable, of the stock award will accelerate in full.

Our plan administrator is not obligated to treat all stock awards or portions thereof or all holders of stock awards, even those that are of the same type, in the same manner.

Under the 2009 Plan, a change in control is generally the occurrence of (1) any transaction or series of related transactions in which in excess of 50% of our voting power is transferred; (2) the replacement of a majority of the members of our Board during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of our Board prior to the date of such appointment or election; or (3) the acquisition by a third party of our assets that have a total gross fair market value equal to or more than 50% of the total gross fair market value of all of our assets immediately prior to such acquisition.

Change in Control. The plan administrator may provide, in an individual award agreement or in any other written agreement between a participant and us that the stock award will be subject to additional acceleration of vesting and exercisability in the event of a change in control.

Amendment and Termination. Our Board has the authority to amend, alter, suspend, or terminate our 2009 Plan, provided that such action does not impair the existing rights of any participant without such participant’s written consent.

2018 Employee Stock Purchase Plan

The 2018 Employee Stock Purchase Plan, or ESPP, will become effective when the Board determines to make this benefit available to employees. The purpose of the ESPP is to retain the services of new employees and secure the services of new and existing employees while providing incentives for such individuals to exert maximum efforts toward our success and that of our affiliates.

Share Reserve. The ESPP authorizes the issuance of 208,050 shares of our common stock pursuant to purchase rights granted to our employees or to employees of any of our designated affiliates. The number of shares of our common stock reserved for issuance under the ESPP will automatically increase on January 1 of each calendar year, beginning on January 1, 2019 and continuing through and including January 1, 2028 by 2% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our Board. Our Board determined that the number of shares of our common stock reserved for issuance under the ESPP would not be increased on January 1, 2020. The ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Code. As of the date hereof, no shares of our common stock have been purchased under the ESPP.

Administration. Our Board has delegated its authority to administer the ESPP to our Compensation Committee. The ESPP is implemented through a series of offerings of purchase rights to eligible employees. Under the ESPP, we may specify offerings with durations of not more than 27 months, and may specify shorter purchase periods within each offering. Each offering will have one or more purchase dates on which shares of our common stock will be purchased for employees participating in the offering. An offering may be terminated under certain circumstances.

Payroll Deductions. Generally, all regular employees, including executive officers, employed by us or by any of our designated affiliates, may participate in the ESPP and may contribute, normally through payroll deductions, up to 15% of their earnings for the purchase of our common stock under the ESPP. Unless otherwise determined by our Board, common stock will be purchased for accounts of employees participating in the ESPP at a price per share equal to the lower of (a) 85% of the fair market value of a share of our common stock on the first date of an offering or (b) 85% of the fair market value of a share of our common stock on the date of purchase.

Limitations. Employees may have to satisfy one or more of the following service requirements before participating in the ESPP, as determined by our Board: (a) customarily employed for more than 20 hours per week,

(b) customarily employed for more than five months per calendar year or (c) continuous employment with us or one of our affiliates for a period of time (not to exceed two years). No employee may purchase shares under the ESPP at a rate in excess of $25,000 worth of our common stock based on the fair market value per share of our common stock at the beginning of an offering for each year such a purchase right is outstanding. Finally, no employee will be eligible for the grant of any purchase rights under the ESPP if immediately after such rights are granted, such employee has voting power over 5% or more of our outstanding capital stock measured by vote or value pursuant to Section 424(d) of the Code.

Changes to Capital Structure. In the event that there occurs a change in our capital structure through such actions as a stock split, merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, large nonrecurring cash dividend, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or similar transaction, the Board will make appropriate adjustments to (a) the class and number of shares reserved under the ESPP, (b) the class and maximum number of shares by which the share reserve may increase automatically each year, (c) the class and number of shares and purchase price of all outstanding offerings and purchase rights and (d) the class and number of shares that are the subject of the purchase limits under each ongoing offering.

Corporate Transactions. In the event of certain significant corporate transactions, including the consummation of: (1) a sale or other disposition of all or substantially all of our assets, (2) the sale or other disposition of more than 50% of our outstanding securities, (3) a merger, consolidation or similar transaction where we do not survive the transaction, and (4) a merger, consolidation or similar transaction where we do survive the transaction but the shares of our common stock outstanding immediately prior to such transaction are converted or exchanged into other property by virtue of the transaction, any then-outstanding rights to purchase our stock under the ESPP may be assumed, continued or substituted for by any surviving or acquiring entity (or its parent company). If the surviving or acquiring entity (or its parent company) elects not to assume, continue or substitute for such purchase rights, then the participants’ accumulated payroll contributions will be used to purchase shares of our common stock within 10 business days prior to such corporate transaction, and such purchase rights will terminate immediately after such purchase.

Plan Amendments, Termination. Our Board has the authority to amend or terminate our ESPP, provided that, except in certain circumstances, any such amendment or termination may not materially impair any outstanding purchase rights without the holder’s consent. We will obtain stockholder approval of any amendment to our ESPP as required by applicable law or listing requirements.

Non-Employee Director Compensation

Prior

The following table sets forth in summary form information concerning the compensation that we paid or awarded during the year ended December 31, 2020 to our initial public offering, we have not paid cash compensation to anyeach of our non-employee directors for service on our Board. As set forth below, we did pay equity compensation to our non-employee directors in 2016 for service on our Board.directors:

Name (1)		Fees Earned or Paid in Cash ($)(2)				Option Awards ($)(2)(3)(4)				Total ($)
David E. Friedman		$	21,875			$	—			$	21,875
Robert W. Pearson		$	18,958			$	—			$	18,958
Brent M. Longnecker		$	51,611			$	100,000			$	151,629
Jose Antonio Moreno Toscano		$	51,611			$	100,000			$	151,629
William R. Wilson, Jr.		$	47,167			$	100,000			$	147,184

(1)	Directors David E. Friedman and Robert W. Pearson resigned from our Board on April 15, 2020.  Each of Brent M. Longnecker, Jose Antonio Moreno Toscano and William R. Wilson, Jr. commenced serving as a director on March 18, 2020.

(2)	In March 2020, the vesting of options held by David E. Friedman to purchase an aggregate of 68,376 shares of common stock was accelerated and the vesting of options held by Robert W. Pearson to purchase an aggregate of 68,376 shares of common stock.

(3)

In accordance with SEC rules, this column reflects the aggregate grant date fair value of the stock option awards granted in 2019 computed in accordance with FASB ASC Topic 718. Assumptions used in the calculation of these amounts are described in Note 5 to our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. These amounts do not reflect the actual economic value that will be realized by the non-employee director upon the vesting of the stock option awards, the exercise of the stock option awards or the sale of the common stock underlying such stock option awards.

(4)

As of December 31, 2020, the aggregate number of shares outstanding under all options to purchase our common stock held by our non-employee directors were: Mr. Friedman: 290,688 shares; Mr. Pearson: 0 shares; Mr. Longnecker: 53,843 shares; Mr. Moreno Toscano: 53,843 shares; and Mr. Wilson: 53,843 shares.

We have reimbursed and will continue to reimburse all of our non-employee directors for their travel, lodging and other reasonable expenses incurred in attending meetings of our Board and committees of our Board.

As of December 31, 2017, the aggregate number of shares outstanding under all options to purchase our common stock held by our non-employee directors were: Mr. Friedman: 307,111; and Mr. Pearson: 307,111.

Our Board adopted a new compensation policyan Outside Director Compensation Policy in September 2017April 2018 that became effective in connection with our initial public offering, was amended in AprilNovember 2018 and became effective upon the completion of the initial public offering of our common stock and will beis applicable to all of our non-employee directors. This compensation policy provides that each such non-employee director maydirectors will receive any of the following compensation elements, as applicable, for service on our Board:Board and its committees:

 

an annual cash retainer of $25,000;$40,000;

 

an additional annual cash fee of $20,000 for service as Chair of the Audit Committee;

•

for each non-employee director who first joins our Board, an initial option grant to purchase shares of our common stock with a value of $175,000, prorated monthly for the period between the date of our last annual meeting of stockholders and the date such non-employee director first joins our Board, on

the date of commencement of service on the board, vesting on the earlier of the one-year anniversary of the grant date or the day prior to the next annual meeting of stockholders; and

 

an additional annual cash fee of $10,000 for service as a member of the Audit Committee (other than the Chair of the Audit Committee);

an additional annual cash fee of $10,000 for service as Chair of the Compensation Committee;

an additional annual cash fee of $5,000 for service as a member of the Compensation Committee (other than the Chair of the Compensation Committee);

an additional annual cash fee of $10,000 for service as Chair of the Nominating and Corporate Governance Committee;

an additional annual cash fee of $5,000 for service as a member of the Nominating and corporate Governance Committee (other than the Chair of the Nominating and Corporate Governance Committee);

for each non-employee director who first joins our Board, an initial option grant to purchase shares of our common stock with a value of $80,000, prorated monthly for the period between the date of our last annual meeting of stockholders and the date such non-employee director first joins our Board, on the date of commencement of service on the Board; and

an annual option grant to purchase shares of our common stock having a value of $175,000$80,000 for each non-employee director serving on the Board on the date of our annual stockholder meeting.

Each annual cash retainer and each additional annual cash fee will be paid quarterly in arrears on a prorated basis.

Each initial option grant and each annual option grant will vest as to all of the shares subject to the option upon the earlier of (i) the one-year anniversary of the grant date and (ii) the day prior to the next annual stockholder meeting vesting one year followingoccurring after the grant date.

Each of the option grants described above will vest and become exercisable subject to the director’s continuous service to us, provided that each option will vest in full upon a change in control (as defined under our 2018 Plan). The term of each option will be 10 years, subject to earlier termination as provided in the 2018 Plan. The options will be granted under our 2018 Plan, the terms of which are described in more detail above under “—Equity Benefit Plans—2018 Equity Incentive Plan.”

RELATED PARTY TRANSACTIONS

The following includes a summary of transactions since January 1, 20152019 to which we have been a party, including transactions in which the amount involved in the transaction exceededexceeds the lesser of $120,000 and 1% of the average of our total assets at December 31, 2017 and 2016,year-end for the last two completed fiscal years, and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than 5% of any class of our voting securities or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than equity and other compensation, termination, change in control and other arrangements, which are described under “Executive Officerelsewhere in this proxy statement. We are not otherwise a party to a current related party transaction, and Director Compensation.”no transaction is currently proposed, in which the amount of the transaction exceeds the lesser of $120,000 and 1% of the average of our total assets at year-end for the last two completed fiscal years and in which a related person had or will have a direct or indirect material interest.

Issuances of Securities to Domecq Sebastian, LLC

In April 2016, we issued an option to purchase 161,396 shares of our common stock with an exercise price of $0.96 per share, to Domecq Sebastian, LLC, the beneficial owner of more than 5% of a class of our voting securities which is affiliated with David Nance, a former director and officer who is now deceased, in exchange for services provided by that entity.

Loan from Domecq Sebastian, LLC

On December 8, 2017, we received a loan from Domecq Sebastian, LLC in the amount of $200,000 and executed a Promissory Note under which we agreed to repay the loan on or before March 31, 2018, with interest at a rate of 15% per annum. The note carried a 18% default interest on amounts paid after the maturity date. We repaid this note in April 2018 with a portion of the proceeds of the initial public offering of our common stock.

Purchase of Shares in Our Initial Public Offering by Christy Mallinson Nance

Christy Mallinson Nance, who holds voting and dispositive power over the securities held by Domecq Sebastian, LLC, purchased an aggregate of 50,000 shares of our common stock in our initial public offering.

Issuances of Securities to Jack A. Roth, MD, FACS

Pursuant to a Consulting Agreement dated November 5, 2009 between us and Jack A. Roth, MD, FACS, the beneficial owner of more than 5% of a class of our voting securities and the Chairman of our SMAScientific and Medical Advisory Board, we issue to Dr. Roth shares of our common stock each year. We issue these shares to Dr. Roth at the beginning of each calendar quarter. Under this arrangement, we issued to Dr. Roth an aggregate of 133,68320,000 shares of our common stock in each2019, an aggregate of 2015, 2016 and 2017 and another 66,84220,000 shares of our common stock in 2018.

Purchase of Shares in Our Initial Public Offering by JREG Investments, Ltd.

JREG Investments, Ltd., an affiliate of Dr. Roth, purchased an aggregate of 40,0002020, 5,000 shares of our common stock in January 2021 and 5,000 shares of our initial public offering.common stock in April 2021.

Issuances of SecuritiesWarrants and Options to Viet-AnHoan Ly and Affiliates of Viet-AnHoan Ly

Stock

From February 2015In April 2020, we issued a warrant to December 31, 2017, we entered into a seriespurchase 500,000 shares of subscription agreementscommon stock at an exercise price of $2.27 per share to Cancer Revolution, LLC, in conjunction with various investment fundspast and future services provided to us. Cancer Revolution is an entity affiliated with Viet-An Hoan Ly, who is, together with his affiliated investment funds, athe beneficial owner of more than 5% of a class of our voting securities, pursuant to which we issued and sold to such entities an aggregate of 687,621 shares of our common stock at a purchase price of $5.29 per share, and received gross proceeds of approximately $3.6 million.

Warrants to Purchase Common Stock

In July 2015, an entity affiliated with Mr. Ly exercised a warrant that we had issued to a different entity in December 2013 and that had been transferred to the entity affiliated with Mr. Ly in December 2013. The warrant was exercisable for 66,841 shares of our common stock, with an exercise price of $2.59 per share, and was exercised in full in February 2016.

In November 2016, we issued to Mr. Ly a warrant exercisable for an aggregate of 542,656 shares of our common stock, with an exercise price of $5.29 per share. The purchase price of the warrant was $8,119. Thatsecurities. This warrant is currently exercisable with respect to 300,000 shares, and becomes vested with respect to the remaining 200,000 shares upon commencement of patient enrollment in a Phase I clinical trial of a diabetes drug candidate based on technology we have licensed from the University of Pittsburgh. This warrant expires on November 1, 2026,April 24, 2030, and is currently outstanding.

In July 2018,April 2021, we issued (a) a warrantgranted an option to purchase 425,000100,000 shares of our common stock at an exercise price of $5.00$7.22 per share to Cancer Revolution, LLC, and (b) a warrant to purchase 144,352 sharesMr. Ly.  The option vests in equal monthly installments over the twelve months following the date of common stock at an exercise price of $5.00 per share to Inception Capital Management, LLC, each of which is an entity affiliated with Mr. Ly, in conjunction with past and future services provided to us. . These warrants are not exercisable before September 24, 2018.grant.

Options to Purchase Common Stock

In April 2016, we granted to Mr. Ly an option to purchase 56,815 shares of our common stock, with an exercise price of $0.96 per share. This option was fully vested at the time of grant and is currently outstanding.

Loan from Viet-An Hoan Ly

On March 9, 2018, we received a loan from Viet Ly in the amount of $25,000 and executed a Promissory Note under which we agreed to repay the loan on or before June 9, 2018, with no interest rate if paid prior to maturity and a rate of 10% per annum if not paid on maturity. We have repaid this note with a portion of the proceeds of the initial public offering of our common stock.

Services Provided by Confer Capital, Inc.

We paid $65,000 in 2016 to Confer Capital, Inc., an entity affiliated with Ryan Confer, our Chief Financial Officer. Confer Capital, Inc. provided strategic, financial, and executive managerial services to us at times when Ryan Confer was not our employee.

Royalty Payments to Introgen Research Institute, Inc.

Pursuant to an Amended Collaboration and Assignment Agreement dated July 1, 2011 between us and Introgen Research Institute, Inc., or IRI (the “2011 IRI Collaboration Agreement”), we are obligated to IRI a royalty of 1% of net sales of licensed products and 1% of certain other payments received by us, with respect to intellectual property owned by the University of Texas MD Anderson Cancer Center ("MD Anderson") and licensed to us by IRI. This royalty obligation continues for 21 years after the later of the termination of thecertain license and sublicense agreements between MD Anderson License Agreement and the termination of the Technology Sublicense Agreement.us. IRI is affiliated with Rodney Varner, our Chief Executive Officer and the Chairman of our Board. We made no payments under the 2011 IRI Collaboration Agreement in 20162018 or 2017.2019.

Loan from Rodney Varner

On March 28, 2018, we received a loan from Rodney Varner in the amount of $45,000 and executed a Promissory Note under which we agreed to repay the loan on or before April 6, 2018, with no interest rate if paid

prior to maturity and a rate of 10% per annum if not paid on maturity. We repaid this note prior to the maturity date with a portion of the proceeds from the initial public offering of our common stock.

Purchase of Shares in Our Initial Public Offering by Rodney Varner

Mr. Varner purchased an aggregate of 10,000 shares of our common stock in our initial public offering.

Employment and Consulting Arrangements

Amendment of Employment Agreement with Catherine M. Vaczy

On March 19, 2021, we and Ms. Vaczy entered into an amendment of Ms. Vaczy’s employment agreement with us to increase her base salary to $420,000 per year, effective as of March 19, 2021.

Amendment of Employment Agreement with Michael T. Redman

On March 19, 2021, we and Mr. Redman entered into an amendment of Mr. Redman’s employment agreement with us to increase his base salary to $400,000 per year, effective as of March 19, 2021.

Employment Agreement with Michael T. Redman

On March 12, 2020, in connection with the appointment of Michael T. Redman as our Executive Vice President and Chief Operating Officer, we entered into an employment agreement with Mr. Redman that governs the terms of his employment with us.

Mr. Redman’s employment under the agreement is at will and may be terminated at any time by us or by him. Under the terms of the agreement, Mr. Redman is initially entitled to receive an annual base salary of $300,000. Mr. Redman is also entitled to receive a bonus upon the achievement of performance objectives agreed upon between our Board of Directors and Mr. Redman.

The agreement provides that for twelve months after the termination of his employment, Mr. Redman will not encourage any of our employees or consultants to leave Genprex and that during the term of Mr. Redman’s employment with us and for twelve months after the termination of his employment, Mr. Redman will not compete or assist others to compete with us.

If we terminate Mr. Redman’s employment without cause or if Mr. Redman resigns for good reason, in either case before a change of control or within twelve months following a change of control, and Mr. Redman delivers to us a signed settlement agreement and general release of claims, we are obligated to pay Mr. Redman: (i) a severance payment equal to six months of Mr. Redman’s base salary then in effect; (ii) a payment equal to one-half of Mr. Redman’s then applicable annual target bonus (provided that any portion of the target bonus that relates to performance criteria that have been achieved shall be calculated at full attainment); (iii) reimbursement of COBRA premium payments made by Mr. Redman for the six months following such termination; and (iv) acceleration as to 100% of Mr. Redman’s unvested equity awards from us, subject in the case of (i) and (ii) to our having at least $5 million in cash or cash equivalents and a net worth of at least $5 million on the date of termination.

For the purposes of Mr. Redman’s employment agreement, “cause” means the occurrence of any of the following events: (i) a determination by our Board of Directors that Mr. Redman’s performance is unsatisfactory after there has been delivered to him a written demand for performance which describes the specific deficiencies in his performance and the specific manner in which his performance must be improved, and which provides 30 business days from the date of notice to remedy such performance deficiencies; (ii) Mr. Redman’s conviction of or plea of nolo contendere to a felony or a crime involving moral turpitude which our Board of Directors reasonably finds has had or will have a detrimental effect on our reputation or business; (iii) Mr. Redman’s engaging in an act of gross negligence or willful misconduct in the performance of his employment obligations and duties that materially harms us; (iv) Mr. Redman’s committing an act of fraud against, material misconduct or willful misappropriation of property belonging to us; or (v) Mr. Redman’s material breach of his confidentiality, invention assignment and noncompetition agreement with us or of any other unauthorized misuse of our trade secrets or proprietary information.

For purposes of Mr. Redman’s employment agreement, “good reason” means the occurrence of any of the following taken without Mr. Redman’s written consent and conditioned on (a) his providing us with notice of the basis for such resignation for good reason, (b) our failure to cure the event constituting good reason within 30 days after notice and (c) his termination of his employment within 30 days following the expiration of the cure period: (i) a material change in Mr. Redman’s position, titles, offices or duties; (ii) an assignment of any significant duties to Mr. Redman that are inconsistent with his positions or offices held under his employment agreement; or (iii) a decrease in Mr. Redman’s then current annual base salary by more than 10% (other than in connection with a general decrease in the salary of all of our other similarly situated employees).

Advisory Agreement with Catherine M. Vaczy

In December 2019, we entered into an Advisory Agreement with Ms. Vaczy. Pursuant to the Advisory Agreement, Ms. Vaczy agreed to provide advisory services to us and we agreed to pay Ms. Vaczy at a rate of $12,500 per month, reimburse her expenses, and, in our sole discretion, provide discretionary performance awards.  We paid a total of $12,500 in 2019 and a total of $142,000 in 2020 to Ms. Vaczy pursuant to the Advisory Agreement, which terminated upon the execution of the employment agreement between Ms. Vaczy and us on March 12, 2020, when she became our Executive Vice President and Chief Strategy Officer.

Consulting Agreement with Michael T. Redman

In August 2019, we entered into a Consulting Agreement with Mr. Redman. Pursuant to the Consulting Agreement, Mr. Redman agreed to provide consulting services to us and we agreed to pay Mr. Redman at a rate of $15,000 per month.  Mr. Redman provided consulting services to us under the Consulting Agreement from August 7 to December 2, 2019, and again from January 31 to March 12, 2020.  We paid a total of $57,580.64 in 2019 and a total of $28,181.32 in 2020 to Mr. Redman pursuant to the Consulting Agreement, which terminated upon the execution of the employment agreement between Mr. Redman and us on March 12, 2020, when he became our Executive Vice President and Chief Operating Officer.

Agreements with Longnecker & Associates

In 2019, we entered into an agreement with Longnecker & Associates, a compensation consulting firm of which Brent M. Longnecker serves as Chairman and Chief Executive Officer. Mr. Longnecker became a member of our Board of Directors on March 18, 2020. Pursuant to the agreement between Longnecker & Associates and us, Longnecker & Associates provided advisory services to the Compensation Committee of our Board of Directors related to cash and equity compensation policies and recommendations. We paid Longnecker & Associates $49,500 in 2019 for such services.

Consulting Agreement with Viet-An Hoan Ly

In August 2018, we entered into a consulting agreement with Viet-An HoanMr. Ly, pursuant to which we agreed to pay Mr. Lyhim $175,000 per year, which amount may vary as determined by Mr. Ly and us, for strategic consulting services. Under this arrangement, we paid Mr. Ly an aggregate of $72,000 in 2019 and $106,000 in 2020.

In May 2018, we entered into an amended and restated employment agreement with Julien Pham, our President and Chief Operating Officer. This agreement amended and restated an employment agreement we entered into with Dr. Pham in October 2016. The amended and restated employment agreement is described in the section titled “Executive Officer and Director Compensation.”

In April 2018, we entered into an employment agreement with each of Rodney Varner, our Chief Executive Officer and Ryan Confer, our Chief Financial Officer, each of which employment agreements became effective upon the closing of the initial public offering of our common stock. These agreements are described in the section titled “Executive Officer and Director Compensation.”

Pursuant to a Consulting Agreement dated November 5, 2009, we pay towith Jack A. Roth, MD, FACS

Pursuant to the Consulting Agreement with Dr. Roth, we pay Dr. Roth annual cash fees at the highest amount which is consistent with the policies of MD Anderson, increased annually by a percentage equal to the automatic cost of living adjustment set forth for Social Security.Security benefits. Under this arrangement, we paid Dr. Roth an aggregate of $185,826$$211,200 in 2015, $192,1912019 and $352,800 in 2016 and $197,192 in 2017.2020.

 

Stock Options Granted to Executive Officers and Directors and Cash Payments Made to Directors

We have granted stock options and shares

In accordance with our Outside Director Compensation Policy, each of our non-employee directors is entitled to certain cash compensation, which is payable quarterly in arrears.

On March 31, 2021 we made the following cash payments to our non-employee directors in consideration of each non-employee director's respective Board and committee service in the quarter ending March 31, 2021: $17,500 to Brent M. Longnecker; $17,500 to Jose Antonio Moreno Toscano; and $15,000 to William R. Wilson, Jr.

In 2019, we made the following cash payments to our non-employee directors in consideration of each non-employee director’s respective Board and committee service in 2019: David E. Friedman: $56,250; Robert W. Pearson: $48,750. Also in 2019, we granted options to purchase common stock with the following values to our executive officers.non-employee directors in consideration of each non-employee director’s respective Board service in 2019: David E. Friedman: $98,750; Robert W. Pearson: $96,250.

In April 2016, we

On March 19, 2021, the Board granted Rodneyan option to purchase 460,000 shares to Mr. Varner, an option to purchase 645,572235,000 shares  to Mr. Confer, an option to purchase 200,000 shares to Ms. Vaczy and an option to purchase 200,000 shares to Mr. Redmond. Each of these options was granted under the 2018 Plan, and each has an exercise price of $5.08 per share, the closing price of our common stock and weas reported on The Nasdaq Capital Market on March 19, 2021, the date of grant. One third of the options granted to each of RyanMr. Varner, Mr. Confer, David FriedmanMs. Vaczy and Robert PearsonMr. Redmond vest each year following March 19, 2021.

On March 12, 2020, in connection with the appointment of Michael T. Redman as our Executive Vice President and Chief Operating Officer, we granted to Mr. Redman an option to purchase 161,396550,000 shares of common stock, each at an exercise price of $0.96 per share. Each option was fully vested on the date of grant.

In November 2016, we granted Julien Pham an option to purchase 162,800 shares ofour common stock, at an exercise price of $5.29$2.00 per share. The option vests at a rate of 1/48 of the shares subject to the option each month following October 26, 2016.

Also in November 2016, we granted Ryan Confer an option to purchase 86,894 shares of common stock, at an exercise price of $5.29 per share. Each option was fully vested on the date of grant.

In May 2017, we granted an award of 73,526 shares of common stock to Ryan Confer in consideration of past services. Each of these shares had a value of $5.29 per share and was fully vested on the date of grant.

In May 2018, we granted Julien Pham an option to purchase 659,346 shares of common stock, at an exercise price of $9.80 per share. One-halfOne thirty-sixth of the options (the “Time Based Options”)vested on March 12, 2020, and 1/36 of the options will vest based on Dr. Pham’s continued employment, with one-third of these options vesting on May 23, 2019, and the remaining two-thirds vesting in equal quarterlymonthly installments over the following two years.  The other one-half of the options vest based on achievement, within time periods specified by our Board, of performance goals specified by our Board.35 months. 

Also in May 2018, we granted Ryan Confer an option to purchase 327,236 shares of common stock, at an exercise price of $9.80 per share. The options vest based on Mr. Confer’s continued employment, with one-third of these options vesting on May 23, 2018, and the remaining two-thirds vesting in equal quarterly installments over the following three years. 

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Indemnification Agreements

We have entered into, and intend to continue to enter into, separatean indemnification agreementsagreement with each of our directors and executive officers.

Policies and Procedures for Transactions with Related Persons

We have adopted a written related-person transactions policy that sets forth our policies and procedures regarding the identification, review, consideration and oversight of “related-person transactions.” For purposes of our policy, only, a “related-person transaction” is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we and any “related person” are participants involving an amount that exceeds the lesser of $120,000 and one percent1% of the average of our total assets at year-end for ourthe last two completed fiscal years.

Transactions involving compensation for services provided to us as an employee, consultant or director are not considered related-person transactions under this policy. A related person is any executive officer, director, nominee to become a director or a holder of more than five percent of our common stock, including any of their immediate family members and affiliates, including entities owned or controlled by such persons.

Under the policy, where a transaction has been identified as a related-person transaction, management must present information regarding the proposed related-person transaction to our Audit Committee (or, where review by our Audit Committee would be inappropriate, to another independent body of our Board) for review. The presentation must include a description of, among other things, all of the parties thereto, the direct and indirect interests of the related persons, the purpose of the transaction, the material facts, the benefits of the transaction to us and whether any alternative transactions are available, an assessment of whether the terms are comparable to the terms available from unrelated third parties and management’s recommendation. To identify related-person transactions in advance, we rely on information supplied by our executive officers, directors and certain significant stockholders. In considering related-person transactions, our Audit Committee or another independent body of our Board takes into account the relevant available facts and circumstances including, but not limited to:

 

the risks, costs and benefits to us;

 

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

 

the terms of the transaction;

 

the availability of other sources for comparable services or products; and

 

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

In the event a director has an interest in the proposed transaction, the director must recuse himself or herself from the deliberations and approval.approval.

 

HOUSEHOLDING OF PROXY MATERIALS

If you and other residents at your mailing address own shares of the Company’s common stock through a broker or other nominee, you may have elected to receive only one copy of this proxy statement and the Company’s Annual Report. If you and other residents at your mailing address own shares of common stock in your own names, you may have received only one copy of this proxy statement and the Annual Report, unless you provided the Company’s transfer agent with contrary instructions. This practice, known as “householding,” is designed to reduce the Company’s printing and postage costs. You may promptly obtain an additional copy of this proxy statement, enclosed proxy card and our Annual Report by sending a written request to Genprex, Inc., attention Secretary, Dell Medical Center, Health Discovery Building, 1701 Trinity Street, Suite 3.322, Austin TX 78712 or by calling us at (512) 537-7997. If you hold your shares through a broker or other nominee and wish to discontinue householding or

to change your householding election, you may do so by contacting your broker. If you hold shares in your own name and wish to discontinue householding or change your householding election, you may do so by contacting V Stock Transfer, LLC, by telephone at (855) 9VSTOCK.

 

OTHER MATTERS

The Board of Directors knows of no other matters that will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the meeting, it is the intention of the persons named in the accompanying proxy to vote on such matters in accordance with their best judgment.

 

	By Order of the Board of Directors,
	/s/ Rodney Varner
	Rodney Varner
	Chief Executive Officer

 

August 29, 2018

May 3, 2021

 

 

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EVENT # CLIENT # PROXY TABULATOR FOR Genprex, Inc. P.O. BOX 8016 CARY, NC 27512-9903 The undersigned hereby appoints Rodney Varner and Ryan Confer, and each of them, as the true and lawful attorneys of the undersigned, with full power of substitution and revocation, and authorizes each of them to vote all the shares of capital stock of Genprex, Inc. that the undersigned is entitled to vote at said meeting and any adjournment thereof upon the matters specified and upon such other matters as may be properly brought before the meeting or any adjournment thereof, conferring authority upon such true and lawful attorneys to vote in their discretion on such other matters as may properly come before the meeting and revoking any proxy heretofore given. THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION IS GIVEN, SHARES WILL BE VOTED FOR THE ELECTION OF THE DIRECTOR NOMINEE IN PROPOSAL 2 AND FOR PROPOSALS 1 AND 3.All votes must be received by 11:59 P.M., Eastern Time, September 30, 2018. MAIL OR • Mark, sign and date your Proxy Card/Voting Instruction Form. • Detach your Proxy Card/Voting Instruction Form. • Return your Proxy Card/Voting Instruction Form in the postage-paid envelope provided. OR Go To www.proxypush.com/GNPX • Cast your vote online. • View meeting documents. • Use any touch-tone telephone. • Have your Proxy Card/Voting Instruction Form ready. • Follow the simple recorded instructions. 866-356-9132 INTERNET TELEPHONE VOTE BY: Annual Meeting of Genprex, Inc. to be held on Monday, October 1, 2018 for Holders as of August 21, 2018 This proxy is being solicited on behalf of the Board of Directors Please separate carefully at the perforation and return just this portion in the envelope provided. 4: To conduct any other business properly brought before the meeting. 3: To ratify the selection by the Audit Committee of the Board of Directors of Daszkal Bolton LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2018. Date: Monday, October 1, 2018 Time: 10:30 A.M. (Central Daylight Time) Place: W2O Group, 507 Calles Street, Suite 112, Austin, TX 78702 See Voting Instruction on Reverse Side. ANNUAL MEETING OF GENPREX, INC. Please Sign Here Please Date Above Please Sign Here Please Date Above Please sign exactly as your name(s) appears on your stock certificate. If held in joint tenancy, all persons should sign. Trustees, administrators, etc., should include title and authority. Corporations should provide full name of corporation and title of authorized officer signing the proxy. Authorized Signatures - This section must be completed for your Instructions to be executed. To attend the meeting and vote your shares in person, please mark this box. For For For For Against Abstain For Against Abstain Directors Recommend Withhold 01 David E. Friedman Please make your marks like this: Use dark black pencil or pen only The Board of Directors recommends a vote FOR proposal 1, FOR the Election of the Director in proposal 2 and FOR proposal 3. 2: Election of Director 1: To approve, for purposes of complying with Nasdaq Listing Rule 5635(d), the issuance by the Company of shares of common stock pursuant to the terms of the private placement financing transaction contemplated by a Securities Purchase Agreement dated May 6, 2018, between the Company and each of the investors named therein, and the other documents and agreements related thereto, without giving effect to the caps on issuing shares contained therein. For Call

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Revocable Proxy — Genprex, Inc. Annual Meeting of Stockholders Monday, October 1, 2018 10:30 a.m. (Central Daylight Time) This Proxy is Solicited on Behalf of the Board of Directors The undersigned appoints Rodney Varner and Ryan Confer, each with full power of substitution, to act as proxies for the undersigned, and to vote all shares of common stock of Genprex, Inc. that the undersigned is entitled to vote at the Annual Meeting of Stockholders on Monday, October 1, 2018, at 10:30 a.m. at the offices of W2O group at 507 Calles Street, Suite 112, Austin, Texas 78702, and any and all adjournments thereof, as set forth below. This proxy is revocable and will be voted as directed. However, if no instructions are specified, the proxy will be voted FOR the election of the director nominee specified in Proposal 2 and FOR Proposals 1 and 3. (CONTINUED AND TO BE SIGNED ON REVERSE SIDE) Please separate carefully at the perforation and return just this portion in the envelope provided.

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