| ●• | establish criteria for prospective members, conduct candidate searches, interview prospective candidates, and oversee programs to introduce the candidate to us, our management, and operations; |
| ● | review planning for succession to the position of Chairman of the Board and Chief Executive Officer and other senior management positions; |
review planning for succession to the position of Chairman of the Board and Chief Executive Officer and other senior management positions; | ● | annually recommend to the Board persons to be nominated for election as directors; |
annually recommend to the Board persons to be nominated for election as directors; recommend to the Board the members of all standing Committees; adopt or develop for Board consideration corporate governance principles and policies; and periodically review and report to the Board on the effectiveness of corporate governance procedures and the Board as a governing body.
| ● | recommend to the Board the members of all standing Committees; |
| ● | adopt or develop for Board consideration corporate governance principles and policies; and |
| ● | periodically review and report to the Board on the effectiveness of corporate governance procedures and the Board as a governing body, including conducting an annual self-assessment of the Board and its standing committees. |
A copy of the charter of the Nominating and Governance Committee is available on our websitewww.secondsight.com (under “About Us“Investors – Corporate Governance”). Policy with Regard to Security Holder Recommendations The Nominating and Governance Committee does not presently have a policy with regard to consideration of any director candidates recommended by security holders. No security holder (other than members of the Nominating and Governance Committee) has recommended a candidate to date. Director Qualifications and Diversity The Board seeks independent directors who represent a diversity of backgrounds and experiences that will enhance the quality of the Board’s deliberations and decisions who each will represent the best interests of the Company and its stockholders.shareholders. Candidates should have substantial experience with one or more publicly traded companies or should have achieved a high level of distinction in their chosen fields. The Board is particularly interested in maintaining a mix that includes individuals who are active or retired executive officers and senior executives, particularly those with experience in medical devices, biotechnology, intellectual property, early stage technology companies, research and development, strategic planning, business development, compensation, finance, accounting or banking. Our Board believes that the directors nominated collectively have the experience and skills effectively to oversee the management of the Company, including a high level of personal and professional integrity, an ability to exercise sound business judgement on a broad range of issues, sufficient experience and background to have an appreciation of the issues facing the Company, and a willingness to devote the necessary time to Board duties. Compensation Committee Interlocks and Insider Participation During 2017,At the start of 2020, Messrs. William Link, Gregg Williams and Matthew Pfeffer served on the Compensation Committee. Mr. Pfeffer stepped down from the committee when he was named acting chief executive officer on March 27, 2020 and Mr. Aaron Mendelson was added to fill the vacancy. Mr. Link left the Board in May 2020. None of these individuals has ever previously been an officer or employee of ours. In addition, none of our executive officers serves as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of our Board or the Compensation Committee.
Code of Conduct We adopted a Code of Business Conduct and Ethics (“Code of Ethics”) applicable to our principal executive officer and principal financial and accounting officer and any persons performing similar functions.on March 27, 2020. In addition, the Code of Ethics applies to our employees, officers, directors, agents and representatives. The Code of Ethics requires, among other things, that our employees avoid conflicts of interest, comply with all laws and other legal requirements, conduct business in an honest and ethical manner, and otherwise act with integrity and in our best interest. The Code of Ethics is available on our website at www.secondsight.com (under “About Us“Investors – Code of Business Conduct and Ethics”). Risk Oversight Enterprise risks are identified and prioritized by management and each prioritized risk is assigned to a Board committee or the full Board for oversight as follows: Full Board — Risks and exposures associated with strategic, financial and execution risks and other current matters that may present material risk to our operations, plans, prospects or reputation. Audit Committee— Risks and exposures associated with financial matters, particularly financial reporting, tax, accounting, disclosure, internal control over financial reporting, financial policies, investment guidelines and credit and liquidity matters. Nominating and Governance Committee— Risks and exposures relating to corporate governance and management and director succession planning. 16
Compensation Committee— Risks and exposures associated with leadership assessment and compensation programs and arrangements, including incentive plans.
Board Leadership Structure The Chairman of the Board presides at all meetings of the Board. Review, Approval or Ratification of Transactions with Related Persons The Nominating and Corporate Governance Committee reviews issues involving potential conflicts of interest, other than Related Party transactions, which are reviewed by the Audit Committee. Section 16(a) Beneficial Ownership Reporting Compliance Based solely upon a reviewSection 16(a) of Forms 3, 4the Exchange Act requires our directors and 5 furnishedexecutive officers, and persons who beneficially own more than 10% of our common stock, to file with the Company,SEC reports about their ownership of common stock and other equity securities of the Company believes that in 2017 all of itsCompany. Such directors, officers and 10% shareholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based solely on our review of the reports provided to us and on representations received from our directors and executive officers, we believe that all of our executive officers, directors and persons who beneficially own more than 10% of our common stock complied with all Section 16(a) filing requirements applicable stockholders timely filed these reports.to them with respect to transactions during fiscal year 2020.
PROPOSALS THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR EACH OF
PROPOSALS 1, THROUGH2, 3 and 4 BELOW. PROPOSAL 1 — ELECTION OF DIRECTORS Nominees for Election The Board currently has fivesix members. Our Board has nominated five of our six incumbent directors for re-electionelection at the Annual Meeting. Each nominee has agreed, ifMeeting to terms expiring at the 2022 annual meeting of shareholders and until their successors are duly elected and qualified, subject to serve a one-year termearlier resignation or until the election and qualification of his successor.removal. If any nominee is unable or declines to stand for election, which circumstance we do not anticipate, the Board may designate a substitute. In the latterthat event, shares represented by proxies may be voted for a substitute nominee. Our Director Qualifications and Diversity guidelines contain the current Board membership criteria that apply to nominees recommended for a position on the Board. Under those criteria, members of the Board should have the highest professional and personal ethics and values, consistent with our longstanding values and standards. They should have broad experience at the policy-making level in business, government, education, technology or public service. They should be committed to enhancing stockholdershareholder value and should have sufficient time to carry out their duties and to provide insight and practical wisdom based on experience. In addition, the Nominating and Governance Committee takes into account a potential director’s ability to contribute to the diversity of background and experience represented on the Board, and it reviews its effectiveness in balancing these considerations when assessing the composition of the Board. Directors’ service on other boards of public companies should be limited to a number that permits them, given their individual circumstances, to perform responsibly all director duties. Each director must represent the interests of all of our stockholders.shareholders. Although the Board uses these and other criteria as appropriate to evaluate potential nominees, it has no stated minimum criteria for nominees. The Board believes that all the nominees named below are highly qualified and have the skills and experience required for effective service on the Board. The nominees’ individual biographies below contain information about their experience, qualifications and skills that led the Board to nominate them: Nominee’s or
Director’s Name | | Year First
Became
Director | | Position with the Company | Gregg Williams | | 2009 | | Independent Director, Non-Executive Chairman | Aaron Mendelsohn | | 1998 | | Independent Director | Jonathan Will McGuire | | 2015 | | President, Chief Executive Officer and Director | William J. LinkMatthew Pfeffer | | 20032015 | | Independent Director | Aaron MendelsohnDean Baker | | 19982021 | | Independent Director | Gregg WilliamsAlexandra Larson | | 20092021 | | Independent Director | Matthew Pfeffer | | 2015 | | Independent Director |
Jonathan Will McGuire, 55,Gregg Williams, 62, Chairman of the Audit Committee, Compensation Committee, Nominating and Governance Committee and of the Board of Directors
Mr. Williams has served as a member of our Board since June 2009 and was appointed Chairman of our board in March 2018. Mr. Williams is the Chairman, President, and Chief Executive Officer at Williams International (www.williams-int.com), a leading developer and manufacturer of gas turbine engines and one of the largest privately owned companies in the aviation industry, positions he has held since July 1999. Previously, Mr. Williams held several key managerial positions within Williams International including serving as its President and Chief Operating Officer, Vice President, Advanced Technology, Director, Program Management and Director, Engineering. In addition, Mr. Williams is Chairman and majority owner of Ramos Arizpe Manufacturing (www.ram-mx.com) a high volume automotive engine parts manufacturing company located in Mexico. Mr. Williams also is a member of the board of directors of Nanoprecision Medical, Inc. (www.nanoprecisionmedical.com), a drug delivery company working in nanotechnology. Mr. Williams received a Bachelor of Science in Mechanical Engineering from the University of Utah and holds numerous patents related to gas turbine engines, turbo machinery, rocket engines and control systems. He is a board member of General Aviation Manufacturers Association and former member of the Henry Ford Hospital Biographical information for Mr. McGuire is set forth under “Executive Compensation and Related Information”.18
Board of Trustees. Our boardBoard believes that Mr. McGuire’sWilliam’s executive and managerial experience together with his leadership skills make him well qualified to continue serving as one of our directors.
William J. Link, 72, Director and Chairman of the Compensation Committee
Mr. Link has served as a member of our Board of Directors since 2003. Mr. Linkis a co-founder and managing director of Versant Ventures, a venture capital firm specializing in early-stage investing in healthcare companies, since its inception in 1999. Prior to co-founding Versant Ventures, Mr. Link was a general partner at Brentwood Venture Capital from 1998 to present. Mr. Link also founded and served as chairman and CEO of Chiron Vision, a subsidiary of Chiron Corporation specializing in ophthalmic surgical products, from 1986 to 1997 which was sold to Bausch + Lomb in 1997. Prior to Chiron Vision, Mr. Link founded in 1978 and served as President of American Medical Optics (AMO), a division of American Hospital Supply Corporation, which was sold to Allergan in 1986. Mr. Link also served on the Board of AMO’s successor company, Advanced Medical Optics (AMO) which was acquired by Abbott in 2009, from 2002 to 2009. Mr. Link was an Assistant Professor in the Department of Surgery at the Indiana University School of Medicine from 1973 to 1976. Mr. Link received his BSc, MSc and Ph.D. from Purdue University. Our board has concluded that Mr. Link’s senior executive history with a focus on medical products as well as his extensive financial and other experience with technology companies in general, including his experience of serving on other boards of directors make him qualified to continue serving as one of our directors.
Aaron Mendelsohn, 66,69, Director Mr. Mendelsohn is a founder and has served as a director of Second Sight since inception. Mr. Mendelsohn served on the board of Advanced Bionics since shortly after its founding in 1993 until its sale in 2004.2004 to Boston Scientific Corp. Mr. Mendelsohn was also a founder and director of Medical Research Group from its inception in 1998 until its sale in 2001 to Medtronic, Inc. Mr. Mendelsohn previously served on the board of directors for the Alfred E. Mann Institute for Biomedical Engineering at the University of Southern California since its inception in 1998 until mid-2016. Mr. Mendelsohn is a founder and, since 2007, a director of Nanoprecision Holding Company, Inc., a company engaged in manipulating materials at nanometer scale. He is also a founder and director of Nanoprecision Medical, Inc., a drug delivery company working in nanotechnology, since its inception in 2011. Mr. Mendelsohn is a founder and serves as Chairman of the Maestro Foundation since it was organized in 1983. The Maestro Foundation is a leading non-profit musical philanthropic organization which hosts a premier chamber music series and lends professional-level instruments and bows to young, career-bound classical musicians. Mr. Mendelsohn received his B.A. from UCLA and J.D. from Loyola University School of Law Los Angeles. Our boardBoard believes that Mr. Mendelsohn’s business experience, including his experience as a founder, and board member and executive officer of medical device companies, combined with his financial experience, business acumen and judgment provide our Board with valuable managerial and operational expertise and leadership skills making him well qualified to continue serving as one of our directors. Gregg Williams, 59, Chairman of the Board of Directors
Jonathan Will McGuire, 58, Director Mr. Williams has served as a member of our Board of Directors since June 2009 and was appointed Chairman of our board in March 2018. Mr. WilliamsMcGuire serves as the Chief Executive Officer at Williams International, a leading developer and manufacturer of small gas turbine engines, since April 2005. Mr. Williams received a Bachelor of Science in Engineering from the University of Utah in 1982. He is a board member of General Aviation Manufacturers Association. Our board believes that Mr. William’s executive and managerial experience together with his leadership skills make him well qualified to continue serving as one of our directors. Matthew Pfeffer, 60, Director and Chairman of Audit Committee
Mr. Pfeffer served as Chief Executive Officer and Chief Financial Officermember of MannKind Corporation from January 2016 to May 2017 and ceased being a directorthe board of that Company in October 2017. Previously, he served as the Corporate Vice President and Chief Financial Officerdirectors of MannKind Corporation from April 2008 until January 2016. Mr. Pfeffer served as Chief Financial Officer and Senior Vice President of Finance and Administration of VaxGen, Inc. from March 2006 until April 2008, with responsibility for finance, tax, treasury, human resources, information technology, purchasing and facilities functions. Prior to VaxGen, Mr. Pfeffer served as Chief Financial Officer of Cell Genesys, Inc. During his nine-year tenure at Cell Genesys, Mr. Pfeffer served as Director of Finance before being named Chief Financial Officer in 1998.RA Medical Systems. Prior to that, Mr. Pfeffer served in a variety of financial management positions at other companies, including roles as Corporate Controller, Manager of Internal Audit and Manager of Financial Reporting. Mr. Pfeffer began his career at Price Waterhouse. Mr. Pfeffer graduated from the University of California, Berkeley and is a Certified Public Accountant. Our board believes that Mr. Pfeffer’s executive and managerial experience together with his leadership skills make him well qualified to continue serving as one of our directors.
Vote Required
Each director nominee who receives more “FOR” votes than “AGAINST” votes representing shares of our common stock present in person or represented by proxy and entitled to be voted at the Annual Meeting will be elected.
All of the nominees have indicated to us that they will be available to serve as directors. In the event that any nominee should become unavailable, the proxy holders, Will McGuire or John T. Blake, will vote for a nominee or nominees designated by the Board.
There are no family relationships among our executive officers and directors.
If you sign your proxy or voting instruction card but do not give instructions with respect to voting for directors, your shares will be voted by Will McGuire or John T. Blake, as proxy holders. If you wish to give specific instructions with respect to voting for directors, you may do so by indicating your instructions on your proxy or voting instruction card.
You may cumulate your votes in favor of one or more of the director nominees. If you wish to cumulate your votes, you will need to indicate explicitly your intent to cumulate your votes among the five persons who will be voted upon at the Annual Meeting. See “Questions and Answers—Voting Information—Is cumulative voting permitted for the election of directors?” for further information about how to cumulate your votes. Will McGuire or John T. Blake as proxy holders, reserve the right to cumulate votes and cast such votes in favor of the election of some or all of the applicable nominees in their sole discretion, except that a stockholder’s votes will not be cast for a nominee as to whom such stockholder instructs that such votes be cast “AGAINST” or “ABSTAIN.”
Our Board recommends a vote “FOR” each of the nominees.
Director Compensation for 2017
During 2017 our non-employee directors were paid an annual retainer of $50,000. Each of our non-employee directors who serves as a committee chair also receives $6,000 per year for his or her service as committee chair and non-chair committee members receive $4,000 per year for each committee on which he serves; provided, however, the additional retainer of the chair of the Audit Committee is $16,000 per year and each non-chair Audit Committee member’s additional retainer is $8,000 per year. All fees were paid for the period June 1, 2016 to May 31, 2017 in shares of our stock on June 1, 2017 and the per share value was determined by an average closing price of our stock for the preceding twenty trading days of our common stock on its principal exchange.
Starting January 1, 2018, our non-employee directors annual cash compensation for serving on the board and committees are payable on the first business day of every quarter. Additionally, our non-employee directors are awarded annual equity compensation retainer in the form of stock options, the number of shares equal to $25,000 divided by the Black-Scholes value of the stock on the date of our annual shareholder meeting. The stock options shall (i) have 10 year term, (ii) fully vest on the earlier of the one year anniversary of grant or the date of next shareholder meeting, no partial vesting is allowed and (iv) upon ceasing to be a board member, the options may be exercised (x) for 30 days in the event of resignation, (y) 60 days in the event of termination, and (z) 90 days in the event of death. Our non-employee directors may elect, on the date of our annual shareholder meeting, to receive their annual cash compensation in the form of stock options calculated on the same basis as the aforementioned equity compensation retainer.
The following Director Compensation Table sets forth information concerning compensation for services rendered by our non-employee directors for fiscal year 2017.
| | | | | | | | | Name | | Fees Earned or Paid in Cash ($) | | Stock Award ($) | | | Total ($) | | Matthew Pfeffer | | — | | | 70,000 | | | | 70,000 | | | | | | | | | | | | | William J. Link, Ph.D. | | — | | | 68,000 | | | | 68,000 | | | | | | | | | | | | | Gregg Williams | | — | | | 66,000 | | | | 66,000 | | | | | | | | | | | | | Aaron Mendelsohn | | — | | | 58,000 | | | | 58,000 | |
PROPOSAL 2 — APPROVe INCREASE IN NUMBER OF SHARES OF COMMON STOCK THAT MAY BE ISSUED UNDER SECOND SIGHT’S 2011 EQUITY INCENTIVE PLAN TO 12 MILLION SHARES OF COMMON STOCK
We are asking our stockholders to consider and vote upon a proposal to approve an amendment to the Second Sight Medical Products, Inc. 2011 Equity Incentive Plan (as amended from time to time, the “Plan”).
On July 15, 2011, our Board adopted the Plan, and our stockholders approved the adoption of the Plan on July 21, 2011. The Plan was further amended in 2011, 2015, 2016 and 2017 to increase the maximum number of shares of common stock that may be issued under the Plan. In April 2018, the Board adopted an amendment to the Plan that, contingent on and subject to approval of our stockholders at the Annual Meeting, would increase the maximum number of shares of common stock that may be issued under the Plan to 12,000,000 shares.
If the stockholders approve the amendment to the Plan, the amendment will become effective on the date of the Annual Meeting, which is scheduled for May 16, 2018. If the stockholders fail to approve the amendment to the Plan, the Plan will continue and remain in effect without any changes to the authorized shares thereto, and compensatory option grants will continue to be granted thereunder to the extent of shares of common stock available for issuance. As of April 9, 2018, the record date, approximately 256,475 shares of common stock remained available for issuance under the Plan (without giving effect to additional shares that may become available upon the future expiration, forfeiture, or cancellation of outstanding awards). Our Board believes that our ability to include equity compensation as part of a total compensation package aligns the interest of our employees with our stockholders. If the amendment to the Plan is not approved, our ability to recruit, motivate and retain key employees will be impaired and thus may require us to shift the mix of total compensation to a greater amount of cash compensation.
Summary of the Material Terms of the Plan, As Amended
A summary of the material terms of the Plan, as amended in 2017, is set forth below. This summary is qualified in its entirety by the detailed provisions of the Plan, as amended, a copy of which is attached as Appendix A to the Proxy Statement we filed with the SEC on May 1, 2017, and which is incorporated by reference into this proposal.
Purpose
The Plan is intended to encourage the key personnel of the Company to have a proprietary and vested interest in the growth and performance of the Company and to generate an increased incentive to contribute to the Company’s future success and prosperity, thus enhancing the value of the Company for the benefit of its equity owners.
Administration
The Plan is administered by the Compensation Committee, which consists of William J. Link, Gregg Williams and Matthew Pfeffer appointed by our Board. The Compensation Committee has the authority to determine the terms and conditions of awards and to interpret and administer the Plan.
Share Reserve and Limitations
The maximum number of shares of common stock reserved for issuance under the Plan is 9,500,000 shares and, if the amendment to the Plan is approved, will be increased to 12,000,000 shares of common stock. As of April 11, 2018, the fair market value of a share of common stock, based on the closing price reported on NASDAQ for that date, is $1.71.
No employee of the Company may be eligible to be granted options covering more than 1,000,000 shares of common stock during any calendar year.
Types of Awards; Eligibility
The Plan permits the Company to grant stock options and restricted stock units (“RSUs”) to our employees and to employees of our controlled subsidiaries. From time to time, the Company may also elect to grant awards to non-employees who are natural persons where it is determined that such grant is in the best interests of the Company. As of the date of this Proxy Statement, approximately 119 employees of the Company and our controlled subsidiaries were eligible to participate in the Plan.
Options
The Compensation Committee may grant options under the Plan. The term of an option may not exceed 10 years. The Compensation Committee determines the exercise price of an option. Payment of the exercise price may be made in cash, shares, or other property acceptable to the Compensation Committee, as well as other types of consideration permitted by applicable law. After the termination of service of a participant, he or she (or, if applicable, his or her estate or beneficiary) may exercise his or her option for the period of time stated in his or her award agreement. Generally, if termination is due to death or disability, the option will remain exercisable for at least six months. In all other cases, the option will generally remain exercisable for at least 30 days following the termination of service. However, in no event may an option be exercised later than the expiration of its term. Subject to the provisions of the Plan, the Compensation Committee determines the other terms of options. Unless the Compensation Committee provides otherwise, the Plan generally does not allow for the transfer of options, and only the participant may exercise an option during his or her lifetime.
RSUs
The Compensation Committee may grant RSUs under the Plan. Subject to the provisions of the Plan, the Compensation Committee determines the terms and conditions of RSUs, including the restricted period for all or a portion of the award and the restrictions and/or forfeiture events applicable to the award. RSUs may vest solely by the passage of time and/or pursuant to achievement of performance goals, and the restrictions and/or the restricted period may differ with respect to each award of RSUs. During the period, if any, when RSUs are non-transferable or forfeitable or prior to the satisfaction of any other restrictions prescribed by the Compensation Committee, a participant is prohibited from selling, transferring, assigning, pledging, or otherwise encumbering or disposing of his or her RSUs. Participants holding RSUs will have no voting or dividend rights or other rights associated with share ownership.
Adjustments to Awards
In the event of certain changes in our capitalization, to prevent diminution or enlargement of the benefits or potential benefits available under the Plan, the Compensation Committee will adjust (i) the aggregate number, class, and kind of shares that may be delivered under the Plan, in the aggregate or to any one participant, and/or (ii) the number, class, and kind of shares subject to outstanding awards and the option price of options.
Change in Control
Unless the Compensation Committee provides otherwise in an applicable award agreement, upon the occurrence of a “change in control” (as defined in the Plan): (i) the vesting of all outstanding awards shall accelerate automatically immediately prior to the consummation of the change in control and (ii) awards may either be assumed or substituted for or be cancelled in exchange for consideration. If options will be not assumed or substituted for, the Compensation Committee must provide written notice not less than 15 days prior to the effective date of the proposed change in control.
Term; Amendment and Termination
The Plan was originally effective as of June 1, 2011 and will automatically terminate on May 31, 2021, unless earlier terminated pursuant to the Plan. Our Board has the authority to amend or terminate the Plan or an award agreement, provided such action does not impair the existing rights of any participant.
Summary of Certain Material U.S. Federal Income Tax Consequences
The U.S. federal income tax consequences of awards under the Plan for participants and the Company will depend on the type of award granted. The following summary description of certain material U.S. federal income tax consequences is intended only for the general information of our stockholders. This summary is not intended to be exhaustive, and the exact tax consequences to any participant depend upon his or her particular circumstances and other facts. Plan participants should consult their tax advisor with respect to any state, local and non-U.S. tax considerations or relevant federal tax implications of awards granted under the Plan.
Non-qualified Stock Options. An option holder generally recognizes no U.S. federal taxable income as a result of the grant of the option. On the exercise of a non-qualified stock option, the option holder normally recognizes ordinary income in the amount equal to the difference between the exercise price and the fair market value of the shares of common stock on the exercise date. Where the option holder is an employee, such ordinary income generally is subject to withholding of income and employment taxes. On the sale of shares of common stock acquired by the exercise of a non-qualified stock option, any gain or loss (based on the difference between the sale price and the fair market value on the exercise date), is taxed as a capital gain or loss. If we comply with applicable reporting requirements and with the restrictions of Section 162(m) of the Internal Revenue Code of 1986, as amended, we will be entitled to a business expense deduction in the same amount and generally at the same time as the option holder recognizes ordinary income.
RSUs.A holder of RSUs generally recognizes no U.S. federal taxable income as a result of the grant of the RSUs. A holder of RSUs will be required to recognize ordinary income in an amount equal to the fair market value of shares issued, or in the case of a cash-settled award, the amount of the cash payment made, to such holder at the end of the restriction period or, if later, the payment date. If we comply with applicable reporting requirements and with the restrictions of Section 162(m) of the Internal Revenue Code of 1986, as amended, we will be entitled to a business expense deduction in the same amount and generally at the same time as the holder recognizes ordinary income.
Plan Benefits
The grant of awards under Company plans is discretionary and neither the number of shares subject to awards nor the types of awards under Company plans to any particular eligible recipients or groups of eligible recipients is presently determinable.
Vote Required and Recommendation
The affirmative vote of the holders of shares of common stock entitled to vote must exceed the votes cast against the proposal for the proposal to be approved.
Our Board unanimously recommends that stockholders vote “FOR” the approval of the proposed increase of maximum number of shares of common stock that may be issued under Second Sight’s 2011 Equity Incentive Plan to 12 million shares of common stock as described in this Proposal 2.
PROPOSAL 3 – APPROVAL OF AN AMENDMENT TO SECOND SIGHT’S 2015 EMPLOYEE STOCK PURCHASE PLAN THAT WILL INCREASE THE MAXIMUM STATED NUMBER OF SHARES OF COMMON STOCK WHICH MAY BE ISSUED UNDER THE PLAN TO 1,550,000 SHARES and increase annual evergreen amount to 500,000 shares.
We are asking our stockholders to consider and vote upon a proposal to approve an amendment to the Second Sight Medical Inc. 2015 Employee Stock Purchase Plan (referred to as the “ESPP”). On March 25, 2015, our Board adopted the ESPP and our stockholders approved the adoption of the ESPP to be effective June 1, 2015. The Plan was further amended in 2017 to increase the maximum number of shares of common stock that may be issued under the ESPP. On April 10, 2018, the Board adopted amendments to the ESPP that, contingent on and subject to approval of our stockholders at the Annual Meeting, would increase the number of shares of common stock that may be issued under the ESPP by 500,000 shares and the number of shares available for annual automatic increases effected under the ESPP to the lesser of (a) 1% of the total number of shares of common stock outstanding on December 31st of the preceding calendar year, or (b) Five Hundred Thousand (500,000) shares of common stock on January 1st of each year, commencing January 1, 2019 and continuing until the expiration of the ESPP.
If the stockholders approve the amended ESPP, it will become effective on the date of Annual Meeting, which is scheduled for May 16, 2018. If the stockholders fail to approve the amended ESPP, the ESPP will continue and remain in effect without any changes to the authorized number of shares thereto. As of March 31, 2018, approximately 301,466 shares of common stock remained available for issuance under the ESPP. Our Board believes that the amended ESPP is in the best interests of the Company, as it provides a convenient way for the Company’s employees to purchase shares of the Company’s common stock at a discounted price, which stock ownership, in our Board’s opinion, aligns the interests of our employees with that of our stockholders.
The Company has previously reserved a total of 1,050,000 shares of common stock for issuance under the ESPP and, until the Board or the Committee determine otherwise, the number of shares of common stock available for purchase by participating employees under the ESPP automatically increases to an amount which is the lesser of (a) 1% of the total number of shares of common stock outstanding on December 31st of the preceding calendar year, or (b) One Hundred Thousand (100,000) shares of common stock on January 1st of each year. The total shares of common stock available for purchase under the ESPP represents less than 2% of the Company’s outstanding shares as of the Record Date.
Summary of the Amended ESPP
A summary of the material terms of the amended ESPP is provided below.
Stock Subject to the ESPP.Originally, subject to adjustment as provided in the ESPP, the maximum number of shares of common stock reserved for issuance pursuant to the ESPP was 250,000 shares. In 2017 the Board adopted, and shareholders approved an increase to the maximum number of shares of common stock reserved for issuance under the ESPP. If the current proposed amendment to the ESPP is approved by the stockholders, subject to adjustment as provided in the ESPP, the maximum number of shares of common stock reserved for issuance under the ESPP will be 1,550,000 shares. In addition, effective January 1, 2019 and continuing until the expiration of the ESPP, the number of shares of common stock available for purchase under the ESPP will automatically increase annually on January 1, in an amount equal to the lesser of (i) 1% of the total number of issued and outstanding shares of the Company’s common stock as of December 31 of the immediately preceding year, or (ii) 500,000 shares of the Company’s common stock, except that the Board or the Committee may act prior to January 1 of any calendar year to provide for an increase of a lesser number of shares (which may be zero). In the event of any stock dividend, stock split, recapitalization, or other change in the capital structure of the Company, the Compensation Committee of our Board of Directors (for purposes of this discussion as to the ESPP, the “Committee”) will make appropriate adjustments in the number and kind of shares subject to the ESPP, the maximum number of shares that may be delivered under the ESPP, and the selling price and any other relevant provision of the ESPP.
Administration.Subject to the express provisions of the ESPP, the Committee has authority to interpret and construe the provisions of the ESPP, to adopt rules and regulations for administering the ESPP, and to make all other determinations necessary or advisable for administering the ESPP. The ESPP will be administered in order to qualify as an employee stock purchase plan under Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”).
Eligibility.In general, all employees employed by the Company and its participating subsidiaries at the beginning of a purchase period are eligible to participate in the ESPP. As of March 31, 2018, there were approximately 119 employees eligible to participate in the ESPP, including five executive officers. Employees must also be actively employed on the last day of the purchase period to purchase shares under the ESPP, except that in the event of a participant’s death, his or her legal representative may elect that such participant’s account balance be used to purchase shares on the purchase date for the then-current offering period. Participation in the ESPP is voluntary. The Committee may designate subsidiaries from time to time among a group consisting of the Company and its subsidiaries as eligible to participate in the ESPP as to its eligible employees. An employee who owns, or would own after the ESPP purchase, 5% or more of the Company’s outstanding shares, including rights to purchase stock as a result of ESPP participation, is ineligible to participate in the ESPP.
Plan Provisions.The ESPP is a broad-based plan that allows employees to purchase shares of the Company’s common stock at up to a 15% discount, measured at the lesser of the closing price of the Company’s Shares on (i) the first day of the Offering Period or (ii) on last day of the Purchase Period. The Committee shall determine the Offering Period and the Purchase Periods, and each Offering Period may consist of one or more Purchase Periods, as the Committee may determine. The ESPP, as initially administered, provides for six-month offering periods, the first day of which is an offering date under the ESPP. Employees fund their purchases through voluntary payroll deductions that accumulate, without interest, in accounts maintained in the employee’s name. A participant may contribute up to 15% of his or her gross base pay. All deductions are made on an after-tax basis.
Eligible employees may elect to become a participant in the ESPP by submitting a payroll deduction authorization form to the Committee or its designee, which will remain effective from offering period to offering period unless and until the participant files new enrollment documents or withdraws from the ESPP.
At the end of each purchase period, and unless the participant terminates employment or withdraws from the ESPP or an offering period on or before the purchase date, the amount credited to the employee’s account is applied to the purchase of Company shares at a price equal to the lesser of the closing price of the Company’s common stock on (i) the first day of the Offering Period or (ii) on last day of the Purchase Period, less the then-current discount. An employee may not purchase shares under the ESPP with a fair market value of more than $25,000 in any given calendar year. On April 11, 2018, the closing price of the Company’s common stock, as reported on the NASDAQ, was $1.71 per share. Shares purchased under the ESPP have the same voting, dividend and other rights as all other shares of Company common stock.
Shares of common stock purchased under the ESPP will be held in the custody of an agent appointed by the Board or the Committee. The Agent may hold the shares of common stock purchased under the ESPP in stock certificates in nominee names and may commingle shares held in its custody in a single account or in stock certificates without identification as to individual participating employees.
The Committee has the right to require any or all of the following with respect to shares of common stock purchased under the ESPP:
| (a) | that a participating employee may not request that all or part of the shares of common stock be reissued in the employee’s own name and the stock certificates delivered to the employee until two years (or such shorter period of time as the Committee may designate) have elapsed since the first day of the Offering Period in which the shares were purchased and one year has elapsed since the day the shares were purchased (the “Holding Period”); | | | |
| (b) | that all sales of shares of common stock during the Holding Period applicable to such purchased shares be performed through a licensed broker acceptable to the Company; and |
| (c) | that participating employees abstain from selling or otherwise transferring shares of common stock purchased pursuant to the ESPP for a period lasting up to two years from the date the shares of common stock were purchased pursuant to the ESPP. |
No participating employee may transfer or assign his or her rights to purchase shares of common stock under the ESPP, whether voluntarily, by operation of law, or otherwise. Any payment of cash or issuance of shares of common stock under the ESPP may be made only to the participating employee (or, in the event of the employee’s death, to the employee’s estate). Once a stock certificate has been issued to the employee or the employee’s estate for his or her account, such certificate may be assigned the same as any other stock certificate.
Amendment and Termination of the ESPP. The Board may, at any time, amend the ESPP in any respect; provided, however, that the stockholders must approve any amendment that would increase the number of shares of common stock that may be issued under the ESPP (other than an increase merely reflecting a change in the Company’s capitalization or in connection with the annual increases automatically effected under the ESPP) or any change in the designation of any corporation (other than a subsidiary of the Company) whose employees may participate in the ESPP. The Board may terminate the ESPP at any time. Upon termination of the ESPP, cash balances then credited to participants’ accounts will be distributed as soon as practicable.
Federal Income Tax Consequences to the Company and to Participants
The ESPP is intended to qualify as an “employee stock purchase plan” under Section 423 of the Code. A general summary of the federal income tax consequences regarding the ESPP is stated below. The summary is based on the law as in effect on the Record Date. The tax consequences of participating in the ESPP may vary with respect to individual situations. Accordingly, participants should consult with their tax advisors in regard to the tax consequences of participating in the ESPP as to both federal and state income tax considerations.
Tax Treatment of ESPP Participants. Participants will not recognize income when they enroll in the ESPP or when they purchase shares. All tax consequences are deferred until the participant disposes of the shares. If the participant holds the shares acquired under the ESPP for at least two years after the offering date and at least one year after the purchase date (referred to as the Section 423 holding period), or if the participant dies while owning the shares, then the participant will generally recognize ordinary income upon sale or other disposition of the shares equal to the lesser of (a) the original discount on the share assuming the stock had been purchased on the offering date or (b) the excess of the fair market value of the share of common stock on the day of disposition over the price he or she paid for the share. Any additional gain will be taxed as long-term capital gain. If the shares are sold for less than the purchase price, there is no ordinary income, and the participant will have a long-term capital loss for the difference between the purchase price and the sale price. If a participant sells or otherwise disposes of the shares before the end of the Section 423 holding period, the participant will generally have ordinary income equal to the difference between the purchase price and the fair market value on the purchase date. The difference between the sale price and the fair market value on the purchase date will be a capital gain or loss, which will be long-term if the shares have been held for more than one year.
Tax Treatment of the Company. If a participant recognizes ordinary income by selling or otherwise disposing of shares before the end of the Section 423 holding period, the Company will generally be entitled to a tax deduction equal to the participant’s ordinary income. Otherwise, the Company will not be entitled to any income tax deduction with respect to shares purchased under the ESPP.
Benefits to Named Executive Officers and Others
The benefits that will be received by participants, including the named executive officers, under the ESPP will depend on each individual’s elections to participate and the fair market value of the Company’s common stock at various future dates. Therefore, it is not possible to determine the benefits that will be received by named executive officers or other employees under the ESPP in advance.
Vote Required and Recommendation
The affirmative vote of the holders of shares of stock entitled to vote must exceed the votes cast against the proposal for the proposal to be approved.
Our Board unanimously recommends that stockholders vote “FOR” the approval of the proposed increase to the maximum stated number of shares of common stock which may be issued under Second Sight’s 2015 Employee Stock Purchase Plan to 1,550,000 shares of common stock and increase of annual evergreen amount to 500,000 shares of common stock as described in this Proposal 3.
REPORT OF THE AUDIT COMMITTEE
The following Report of the Audit Committee shall not be deemed incorporated by reference into any of our filings under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent we specifically incorporate it by reference therein.
The Audit Committee of the Board has:
| ● | reviewed and discussed the Company’s audited consolidated financial statements for the year ended December 31, 2017 with management and with the Company’s independent registered public accounting firm, Gumbiner Savett Inc.; |
| ● | discussed with the Company’s independent auditors the matters required to be discussed by Statement on Auditing Standards No. 1301, “Communications with Audit Committees”, as adopted by the Public Company Accounting Oversight Board (“PCAOB”); and |
| ● | received and reviewed the written disclosures and letter from the independent auditors required by the PCAOB regarding the independent auditors’ communications with the Audit Committee concerning independence and has discussed with Gumbiner Savett Inc. matters relating to its independence from the Company and its management. |
Members of the Audit Committee rely, without independent verification, on the information provided to them and on the representations made by management and the independent auditors. Accordingly, the Audit Committee’s oversight does not provide an independent basis to determine that management has maintained appropriate accounting and financial reporting principles, or appropriate internal controls and procedures, designed to assure compliance with accounting standards and applicable laws and regulations. Furthermore, the Audit Committee’s considerations and discussions referred to above do not assure that the audits of the Company’s consolidated financial statements have been carried out in accordance with generally accepted auditing standards, that the consolidated financial statements are presented in accordance with U.S. generally accepted accounting principles or that the Company’s Independent Accountants are in fact “independent.”
Based upon the reviews and discussions described above, and subject to the limitations on the role and responsibilities of the Audit Committee referred to in this report and in the Audit Committee Charter, the Audit Committee recommended to the Board that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017.
Audit Committee of the Board
Matthew Pfeffer
Gregg Williams
William J. Link, Ph.D.
Aaron Mendelsohn
PROPOSAL 4 — RATIFICATION OF APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of the Board has reappointed Gumbiner Savett Inc. as our independent registered public accounting firm to audit our financial statements for the fiscal year ending December 31, 2018. Gumbiner Savett Inc. has served as our independent registered public accounting firm since 2014.
Stockholder ratification of the selection of Gumbiner Savett Inc. as our independent registered public accounting firm is not required by our Bylaws or otherwise. The Board seeks such ratification as a matter of good corporate practice. Should the stockholders fail to ratify the selection of Gumbiner Savett Inc. as our independent registered public accounting firm, the Board will reconsider whether to retain that firm for fiscal year 2018. Even if the selection is ratified, the Audit Committee of the Board in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and its stockholders.
Principal Accounting Fees and Services
The following table represents aggregate fees billed to the Company for fiscal years ended December 31, 2017 and 2016 by Gumbiner Savett Inc.:
| | December 31, | | | | 2017 | | | 2016 | | | | | | | | | Audit Fees(1) | | $ | 117,500 | | | $ | 124,716 | | Audit Related Fees(2) | | | — | | | | — | | Tax Fees(3) | | | — | | | | — | | All Other Fees(4) | | | 42,024 | | | | 19,507 | | | | | | | | | | | Total Fees | | $ | 159,524 | | | $ | 144,223 | |
1. | “Audit Fees” are the aggregate fees of Gumbiner Savett Inc. attributable to professional services rendered to us for the audit of our annual financial statements and review of quarterly financial information. |
2. | “Audit-Related Fees” consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under “Audit Fees.” Gumbiner Savett Inc. has not billed us for any Audit-Related Fees for each of the last two fiscal years. |
3. | “Tax Fees” consist of fees billed for services rendered for tax compliance, tax advice, and tax planning. Gumbiner Savett Inc. does not render such services to the Company. |
4. | “All Other Fees” consist of fees billed for services other than the services reported in Audit Fees, Audit-Related Fees, and Tax Fees. In 2017 Gumbiner Savett, Inc. provided services to us in connection with our registration statement on Form S-1 that related to our registered rights offering which closed in March 2017. In 2016 Gumbiner Savett, Inc. provided services to us in connection with our registration statement on Form S-1 that related to our registered rights offering which closed in June 2016. |
Pre-Approval Policies and Procedures
The Audit Committee is required to review and approve in advance the retention of the independent auditors for the performance of all audit and lawfully permitted non-audit services and the fees for such services. The Audit Committee may delegate to one or more of its members the authority to grant pre-approvals for the performance of non-audit services, and any such Audit Committee member who pre-approves a non-audit service must report the pre-approval to the full Audit Committee at its next scheduled meeting.
Gumbiner Savett Inc. Representatives at Annual Meeting
We expect that representatives of Gumbiner Savett Inc. will not be present at the Annual Meeting.
Vote Required and Recommendation
The affirmative vote of a majority of the votes cast on this matter is required for the ratification of the appointment of Gumbiner Savett Inc. as our independent registered public accounting firm. Abstentions and broker non-votes, if any, will not be counted as votes cast.
The Board recommends that stockholders vote “FOR” ratification of the appointment of Gumbiner Savett Inc. as our independent registered public accounting firm for the fiscal year ending December 31, 2018 as described in this Proposal 4.
EXECUTIVE COMPENSATION AND RELATED INFORMATION
Compensation Discussion
Overview
The Compensation Committee of the Board of Directors administers our executive compensation and benefit programs. The Compensation Committee is comprised exclusively of independent directors and oversees all compensation and benefit programs and actions that affect our executive officers.
Compensation Process and Role of Management
The Compensation Committee is responsible for determining and approving all compensation for our executive officers. Pursuant to its charter, the Compensation Committee recommends to the full Board the salary, annual incentive compensation or bonus, long-term incentive compensation in the form of stock options or restricted stock units, and all other employment, severance and change-in-control agreements applicable to executive officers. Our Chief Executive Officer assists the Compensation Committee in its deliberations with respect to the compensation payable to our other executive officers, and typically recommends specific compensation packages for our executive officers based upon his assessment and evaluation of their performance.
Following the end of each fiscal year, our Chief Executive Officer evaluates executive officer performance for the prior fiscal year, other than his own performance, and discusses the results of such evaluations with the Compensation Committee. The Chief Executive Officer assesses each executive officer’s performance for the prior fiscal year based upon subjective factors concerning such officer’s individual business goals and objectives, and the contributions made by the executive officer to our overall results. The Chief Executive Officer then makes specific recommendations to the Compensation Committee for adjustments to base salary and the grant of a target bonus and/or equity award, if appropriate, as part of the compensation packages for each executive officer, other than himself, for the next fiscal year.
The Compensation Committee reviews the performance of the Chief Executive Officer and determines all compensation for the Chief Executive Officer. The Chief Executive Officer is not present at the time the Compensation Committee reviews his performance and discusses his compensation.
Executive Officers
Jonathan Will McGuire
Mr. McGuire, 55, has served as our President and Chief Executive Officer sincefrom August 2015.2015 to March 2020. Prior to that, Mr. McGuire served at Volcano Corporation, where he was President of Americas Commercial since 2014 and prior to that, Senior Vice President and General Manager of Coronary Imaging, Systems and Program Management since 2013. Volcano, a global leader in intravascular imaging for coronary and peripheral applications and physiology, was acquired by Royal Philips in February 2015. Prior to joining Volcano, Mr. McGuire served as Vice President and General Manager of Patient Monitoring at Covidien. He previously served as President and Chief Executive Officer of AtheroMed, Inc., a venture capital-backed peripheral atherectomy company, prior to which he was Chief Operating Officer at Spectranetics Corporation, a publicly-traded medical device company. In addition, Mr. McGuire held various positions at Guidant Corporation from 1998 to 2005 including General Manager of Guidant Latin America; Director of U.S. Marketing for Vascular Intervention (VI); Director of Global Marketing for VI; and, Production Manager for Coronary Stents. Prior to 1998, Mr. McGuire held positions in Finance and Production at IVAC Medical Systems. A graduate of the Georgia Institute of Technology, Mr. McGuire received his M.B.A. from the Kenan-Flagler Business School at the University of North Carolina at Chapel Hill.
Matthew Pfeffer, 64, Director and Chairman of Audit Committee Mr. Pfeffer has served as a member of our Board since 2015. Mr. Pfeffer served as acting chief executive officer of the company from March 27, 2020 to March 26, 2021. Mr. Pfeffer served as a member of the board of directors of MannKind Corporation from January 2016 through October 2017, and served as a special adviser to the company from November 2017 through February 2019. He served as Chief Executive Officer and Chief Financial Officer of MannKind from January 2016 through May 2017, and as Corporate Vice President and Chief Financial Officer of MannKind from April 2008 until January 2016. Previously, Mr. Pfeffer served as Chief Financial Officer and Senior Vice President of Finance and Administration of VaxGen, Inc. from March 2006 until April 2008, with responsibility for finance, tax, treasury, human resources, information technology, purchasing and facilities functions. Prior to VaxGen, Mr. Pfeffer served as Chief Financial Officer of Cell Genesys, Inc. During his nine-year tenure at Cell Genesys, Mr. Pfeffer served as Director of Finance before being named Chief Financial Officer in 1998. Prior to that, Mr. Pfeffer served in a variety of financial management positions at other companies, including roles as Corporate Controller, Manager of Internal Audit and Manager of Financial Reporting. Mr. Pfeffer began his career at Price Waterhouse. Mr. Pfeffer graduated from the University of California, Berkeley and is a Certified Public Accountant. Our Board believes that Mr. Pfeffer’s executive and managerial experience together with his leadership skills make him well qualified to continue serving as one of our directors. 19
Dean Baker, 78, Director Dr. Baker serves on the Board of Directors of Nano Precision Medical since 2013 and on the Board of Directors of Transonic Imaging since 2018. Mr. Baker served on the Board of Directors of Advanced Bionics prior to its sale to Boston Scientific. In addition, he was the founding director of the Alfred E. Mann Institute for Biomedical Engineering at USC, and served for nine years on the Board of Directors (including serving on compensation, audit, and governance committees) for Semtech, a publicly traded semiconductor company. He currently serves on the Board of Directors for Transonic Imaging, a medical imaging startup. Dr. Baker was also a vice president of Northrop Grumman for 16 years including overseeing a division with $1 billion in annual sales. Alexandra Larson, 41, Director Ms. Larson serves as Vice President and General Counsel of Williams International, a privately-held designer and manufacturer in the aerospace and defense industry, since January 2019. Prior to Williams International, from 2013 to January 2019, Ms. Larson was Legal Director and Associate General Counsel at Amcor. Ms. Larson also served as Corporate Counsel at Compuware Corporation, and Associate in the mergers & acquisitions practice of the global law firm Baker and McKenzie, in its New York office. Ms. Larson held positions with the New York Stock Exchange and the United States Department of Justice, Antitrust Division. Ms. Larson is a graduate of the University of Michigan Law School (Ann Arbor), Hamilton College in Clinton, New York, and the University of Tennessee, Knoxville Haslam College of Business's Aerospace & Defense MBA Program. Vote Required Each director nominee who receives more “FOR” votes than “AGAINST” votes representing shares of our common stock present in person or represented by proxy and entitled to be voted at the Annual Meeting will be elected. All of the nominees have indicated to us that they will be available to serve as directors. In the event that any nominee should become unavailable, the proxy holders, Scott Dunbar or Edward Sedo, will vote for a nominee or nominees designated by the Board. There are no family relationships among our executive officers and directors. If you sign your proxy or voting instruction card but do not give instructions with respect to voting for directors, your shares will be voted by Scott Dunbar or Edward Sedo, as proxy holders. If you wish to give specific instructions with respect to voting for directors, you may do so by indicating your instructions on your proxy or voting instruction card. You may cumulate your votes in favor of one or more of the director nominees. If you wish to cumulate your votes, you will need to indicate explicitly your intent to cumulate your votes among the five persons who will be voted upon at the Annual Meeting. See “Questions and Answers—Voting Information—Is cumulative voting permitted for the election of directors?” for further information about how to cumulate your votes. Scott Dunbar or Edward Sedo as proxy holders, reserve the right to cumulate votes and cast such votes in favor of the election of some or all of the applicable nominees in their sole discretion, except that a shareholder’s votes will not be cast for a nominee as to whom such shareholder instructs that such votes be cast “AGAINST” or “ABSTAIN.” Our Board recommends a vote “FOR” each of the nominees. Director Compensation for 2020 During 2020 our non-employee directors were compensated with an annual retainer of $35,000. These non-employee directors were paid their annual base compensation retainers for serving on the board and committees in cash on the first business day of every quarter. Our non-employee director who serves as Audit Committee chair also receives $18,000 per year for his service as committee chair and non-chair committee members receive $8,000 per year. The retainer for the Compensation Committee chairman is $12,000 per year and the retainer for each other Compensation Committee member is $6,000 per year. The retainer for the Nominating and Governance Committee chairman is $10,000 per year and each other Nominating Committee member is $5,000 per year. Additionally, our non-employee directors were paid an equity compensation retainer in 2019, but not in 2020, in the form of stock options that equal 20
$25,000 divided by the Black-Scholes value of the stock on the date of their issuance. The stock options (i) have a 10 year term, (ii) fully vest on the earlier of one year anniversary of grant or the date of next shareholder meeting, no partial vesting is allowed and (iv) upon ceasing to be a board member, the options may be exercised (x) for 30 days in the event of resignation, (y) 60 days in the event of termination, and (z) 90 days in the event of death. One of our non-employee directors elected, on the date of our annual shareholder meeting, to receive his base compensation retainers in the form of stock options on the same terms as the aforementioned equity compensation retainer. The table below sets forth information concerning compensation for services rendered by our non-employee directors the year ended December 31, 2020. Name | | Fees Earned or Paid in Cash | | Stock Awards | | | | Option Awards | | | Non-Equity Incentive Plan Compensation | | Nonqualified Deferred Compensation Earnings | | | All Other Compensation | | Total | | Gregg Williams | | $ | — | | $ | — | | | | $ | — | | | $ | — | | $ | — | | | $ | — | | $ | | | William J. Link1 | | | 43,336 | | | | | | | | | | | | — | | | — | | | | — | | | 43,336 | | Aaron Mendelsohn | | | 43.008 | | | — | | | | | — | | | | — | | | — | | | | — | | | 43,008 | | Matthew Pfeffer2 | | | 44,053 | | | — | | | | | — | | | | — | | | — | | | | — | | | 44,053 | | Jonathan Will McGuire3 | | | 26,629 | | | — | | | | | — | | | | — | | | — | | | | — | | | 26,629 | |
| 1. | Mr. Link resigned as a member of the Board effective May 31, 2021. |
| 2. | Mr. Pfeffer also served as our Acting Chief Executive Officer from March 27, 2020 until March 26, 2021 and has remained an incumbent director throughout this period. |
| 3. | Mr. McGuire resigned as our chief executive officer effective March 26, 2020 and has continued as an incumbent director of the Company. |
REPORT OF THE AUDIT COMMITTEE The Audit Committee of the Board of Directors (the "Audit Committee") has furnished this report concerning the independent audit of the Company's consolidated financial statements. Each member of the Audit Committee meets the enhanced independence standards established by the Sarbanes-Oxley Act of 2002 and rulemaking of the Securities and Exchange Commission (the "SEC") and the NASDAQ Stock Market regulations. A copy of the Audit Committee Charter is available on the Company's website at http://www.secondsight.com. The Audit Committee's responsibilities include assisting the Board of Directors regarding the oversight of the integrity of the Company's consolidated financial statements, the Company's compliance with legal and regulatory requirements, the independent registered public accounting firm's qualifications and independence, and the performance of the independent registered public accounting firm. In fulfilling its responsibilities, the Audit Committee of the Board has: reviewed and discussed the Company’s audited consolidated financial statements for the year ended December 31, 2020 with management and with the Company’s independent registered public accounting firm, Gumbiner Savett Inc.; discussed with the Company’s independent auditors the matters required to be discussed by Statement on Auditing Standards No. 1301,“Communications with Audit Committees”, as adopted by the Public Company Accounting Oversight Board (“PCAOB”); and received and reviewed the written disclosures and letter from the independent auditors required by the PCAOB regarding the independent auditors’ communications with the Audit Committee concerning independence and has discussed with Gumbiner Savett Inc. matters relating to its independence from the Company and its management. In addition the Audit Committee has regularly met separately with management and with Gumbiner Savett Inc. Based upon the reviews and discussions described above, the Audit Committee recommended to the Board that the audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. | Audit Committee of the Board | Gregg Williams | Aaron Mendelsohn |
Dean Baker
PROPOSAL 2 — RATIFy ON ADVISORY BASIS the APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM The Audit Committee of the Board has reappointed Gumbiner Savett Inc. as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ending December 31, 2021. Gumbiner Savett Inc. has served as our independent registered public accounting firm since 2014. Shareholder ratification of the selection of Gumbiner Savett Inc. as our independent registered public accounting firm is on an advisory basis, and is not required by our Bylaws or otherwise. The Board seeks such ratification as a matter of good corporate practice. Should the shareholders fail to ratify the selection of Gumbiner Savett Inc. as our independent registered public accounting firm, the Board will reconsider whether to retain that firm for fiscal year 2021. Even if the selection is ratified, the Audit Committee of the Board in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and its shareholders. Principal accounting fees and services The following table represents aggregate fees billed to the Company for fiscal years ended December 31, 2020 and 2019 by Gumbiner Savett Inc.: | | December 31, | | | | 2020 | | | 2019 | | Audit Fees(1) | | $ | 117,500 | | | $ | 117,500 | | Audit Related Fees(2) | | | — | | | | — | | Tax Fees(3) | | | — | | | | — | | All Other Fees(4) | | | 21,655 | | | | 27,343 | | Total Fees | | $ | 139,155 | | | $ | 144,843 | |
1. | “Audit Fees” are the aggregate fees of Gumbiner Savett Inc. attributable to professional services rendered to us for the audit of our annual consolidated financial statements and review of quarterly financial information. |
2. | “Audit-Related Fees” consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported above under “Audit Fees.” Gumbiner Savett Inc. has not billed us for any Audit-Related Fees for each of the last two fiscal years. |
3. | “Tax Fees” consist of fees billed for services rendered for tax compliance, tax advice, and tax planning. Gumbiner Savett Inc. does not render these services to the Company. |
4. | “All Other Fees” consist of fees billed for services other than the services reported in Audit Fees, Audit-Related Fees, and Tax Fees. In 2020 Gumbiner Savett Inc. provided services to us in connection with our March 2020 Form S-8 registration statement and our May 2020 public offering of common stock. |
Pre-Approval Policies and Procedures The Audit Committee reviews and pre-approves all audit and permissible non-audit services provided by the independent registered public accounting firm. These services may include audit services, audit-related services and tax services, as well as specifically designated non-audit services which, in the opinion of the Audit Committee, will not impair the independence of the independent registered public accounting firm. Pre-approval generally is provided for up to one year, and any pre-approval is detailed as to the particular service or category of services and generally is subject to a specific budget. The independent registered public accounting firm and the Company’s management are required to periodically report to the Audit Committee regarding the extent of services provided by the independent registered public accounting firm in accordance with this pre-approval, including the fees for the services performed to date. In addition, the Audit Committee also may pre-approve particular services on a case-by-case basis, as necessary or appropriate. 23
Gumbiner Savett Inc. Representatives at Annual Meeting We expect that representatives of Gumbiner Savett Inc. will not be present at the Annual Meeting. Vote Required and Recommendation The affirmative vote of a majority of the votes cast on this matter is required for the ratification of the appointment of Gumbiner Savett Inc. as our independent registered public accounting firm. Abstentions and broker non-votes, if any, will not be counted as votes cast. The Board recommends that shareholders vote “FOR” ratification of the appointment of Gumbiner Savett Inc. as our independent registered public accounting firm for the fiscal year ending December 31, 2021 as described in this Proposal 2.
PROPOSAL NO. 3 - ADVISORY VOTE ON EXECUTIVE COMPENSATION Introduction Under Section 14A of the Exchange Act, the Company’s shareholders are entitled to vote to approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in this proxy statement in accordance with SEC rules, commonly referred to as a “say-on-pay vote.” This vote is not intended to address any specific item of compensation, but rather the overall compensation of the Company’s named executive officers disclosed in the “Executive Officers and Compensation” section of this Proxy Statement. The Company believes that its compensation policies and decisions are aligned with our stockholders’ interests, and that the compensation of the Company’s named executive officers is designed to enable the Company to attract and retain talented and experienced executives to lead the Company successfully in a competitive environment. Accordingly, our Board is asking the stockholders to indicate their support for the compensation of the Company’s named executive officers as described in this Proxy Statement by casting a non-binding advisory vote “FOR” the following resolution: “RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the compensation tables and narrative discussion, is hereby APPROVED.” Because the vote is advisory, it is not binding on our Board, the Compensation Committee, or the Company. Nevertheless, the views expressed by the stockholders, whether through this vote or otherwise, are important to management and the Board and, accordingly, the Board and the Compensation Committee intend to consider the results of this vote in making determinations in the future regarding executive compensation arrangements. Advisory approval of this proposal requires the 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. Subject to the stockholders’ indication, on an advisory basis, that the stockholder advisory vote on executive compensation be conducted every year (see, Proposal No. 4), and unless the Board decides otherwise with respect to the frequency of soliciting say-on-pay votes, we expect that the next say-on-pay vote will be at the 2022 Annual Meeting of Stockholders. The Board recommends a vote “FOR” the approval, on an advisory basis, of the compensation of the company’s named executive officers as disclosed in this Proposal 3.
PROPOSAL NO. 4 - ADVISORY VOTE ON THE FREQUENCY OF STOCKHOLDER ADVISORY VOTES ON COMPENSATION Introduction Under Section 14A of the Exchange Act, the Company’s stockholders are entitled, at least once every six years, to indicate their preference regarding how frequently the Company should solicit a non-binding advisory vote on the compensation of our named executive officers as disclosed in this Proxy Statement. Accordingly, we are asking our stockholders to indicate whether they would prefer an advisory vote every one year, two years, or three years. Alternatively, stockholders may abstain from casting a vote. After considering the benefits and consequences of each alternative, the Board recommends that the advisory vote on the compensation of our named executive officers be submitted to our stockholders every “One Year.” The Board currently believes that an annual advisory vote on the compensation of our named executive officers is the most appropriate policy for us at this time. While our executive compensation program is designed to promote the creation of stockholder value over the long term, the Board recognizes that executive compensation disclosures are made annually, and holding an annual advisory vote on the compensation of our named executive officers provides us with more direct and immediate feedback on our executive compensation program and disclosures. However, stockholders should note that because the advisory vote occurs well after the beginning of the compensation year, and because certain elements of our executive compensation programs are designed to operate in an integrated manner and to complement one another, in some cases it may not be appropriate or feasible to change our compensation plans and arrangements for our executive officers in consideration of any single year’s advisory vote by the time of the following year’s Annual Meeting of Stockholders. Accordingly, the Board is asking our stockholders to indicate their preferred voting frequency by voting for every (i) one year, (ii) two years, or (iii) three years or (iv) abstaining from voting on this proposal. While the Board believes that its recommendation is appropriate at this time, our stockholders are not voting to approve or disapprove that recommendation, but are instead asked to indicate their preferences, on an advisory basis, as to whether the non-binding advisory vote on the approval of our compensation practices for our named executive officers should be held every one year, two years, or three years. The option among those choices that receives the highest number of votes from the holders of shares present in person or represented by proxy and entitled to vote on the matter at the Annual Meeting will be deemed to be the frequency preferred by our stockholders. The Board and the Compensation Committee value the opinions of our stockholders in this matter and, to the extent there is any significant vote in favor of one frequency over the other options, the Board will consider our stockholders’ concerns and evaluate any appropriate next steps. However, because this vote is advisory and therefore not binding on the Board or the Company, the Board may decide that it is in the best interests of our stockholders that we hold an advisory vote on the compensation of our named executive officers more or less frequently than the option preferred by the stockholders. The vote will not be construed to create or imply any change or addition to the fiduciary duties of the Company or the Board. The Board recommends a vote “FOR” that the advisory vote on the compensation of our named executive officers to be submitted to our stockholders every “One Year,” as disclosed in this Proposal 4.
EXECUTIVE COMPENSATION AND RELATED INFORMATION Compensation Discussion Overview The Compensation Committee of the Board of Directors administers our executive compensation and benefit programs. The Compensation Committee is comprised exclusively of independent directors and oversees all compensation and benefit programs and actions that affect our executive officers. Compensation Process and Role of Management The Compensation Committee is responsible for determining and approving all compensation for our executive officers. Pursuant to its charter, the Compensation Committee recommends to the full Board the salary, annual incentive compensation or bonus, long-term incentive compensation in the form of stock options or restricted stock units, and all other employment, severance and change-in-control agreements applicable to executive officers. Our Chief Executive Officer assists the Compensation Committee in its deliberations with respect to the compensation payable to our other executive officers, and typically recommends specific compensation packages for our executive officers based upon his assessment and evaluation of their performance. Following the end of each fiscal year, our Chief Executive Officer evaluates executive officer performance for the prior fiscal year, other than his own performance, and discusses the results of such evaluations with the Compensation Committee. The Chief Executive Officer assesses each executive officer’s performance for the prior fiscal year based upon subjective factors concerning such officer’s individual business goals and objectives, and the contributions made by the executive officer to our overall results. The Chief Executive Officer then makes specific recommendations to the Compensation Committee for adjustments to base salary and the grant of a target bonus and/or equity award, if appropriate, as part of the compensation packages for each executive officer, other than himself, for the next fiscal year. The Compensation Committee reviews the performance of the Chief Executive Officer and determines all compensation for the Chief Executive Officer. Executive Officers Scott Dunbar Mr. Dunbar, 64, has served Second Sight for 19 years as Patent Counsel, Senior Patent Counsel, and Senior Patent Counsel and Compliance Officer. He was named Acting CEO by the Board March 26, 2021. Prior to Second Sight, in 2000 he was Of Counsel at Katten Muchin and Zavis (now Katten Muchin and Rosenman), during 1999 he was Of Counsel at Fitch Even Tabin and Flannery, from 1997 to 1999 he was Patent Counsel at Packard Bell, and from 1987 to 1997 Patent Counsel at Zenith Data Systems. Mr. Dunbar received a Juris Doctor from the John Marshall Law School, a Master of Science in Computer Science from Illinois Institute of Technology and a BA in Music from DePauw University. Edward Sedo Edward Sedo, 65, has served as our Acting Chief Accounting Officer since September 2020. Prior to that Mr. Sedo served as our Manager of Financial Reporting since February 2015. Prior to that Mr. Sedo served as Assistant Controller at Calavo Growers a publicly-traded produce company from March 2008 to November 2014. Mr. Sedo served as the VP, Financial Reporting at Countrywide a publicly-traded mortgage company, from December 2004 to March 2008. Mr. Sedo is a Certified Public Accountant and holds a BBA in accounting from the University of Michigan-Dearborn. Edward Randolph Mr. Randolph, 63, has served as Vice President, Operations since September 14, 2020 and served as our Vice President of Manufacturing since 2007. From 2003 to 2007, Mr. Randolph was Director of Manufacturing Engineering at Boston Scientific Corp., a worldwide manufacturer of medical devices and products. From 2001 to 2003, Mr. Randolph was 27
a Director of Manufacturing Engineering at Cygnus, Inc., manufacturer of non-invasive transdermal drug delivery systems. Mr. Randolph received his Master of Science in Engineering from Stanford University and his Bachelor of Science in Architecture from Massachusetts Institute of Technology. Jessy Dorn, Ph.D. Dr. Dorn, 45, joined Second Sight in November 2006, As Vice President of Clinical and Scientific Affairs, she leads the effort to understand and improve the artificial vision created by the Orion and Argus II Systems. Her work encompasses clinical research strategy, principles of neurostimulation, low vision outcome measures, and human visual psychophysics. Prior to joining Second Sight she worked as an Assistant Curator at the California Science Center and as a freelance science writer. She received her Ph.D. in Neuroscience from UCLA, studying primate visual cortex, and her BA in Biology from the University of Chicago. Former Officers John T. Blake Mr. Blake 41, has served as our Chief Financial Officer sincefrom March 2018.2018 until August 2020. Prior to that Mr. Blake served as Senior Vice President, Finance from February 2017 to March 2018, Vice President, Finance from October 2015 to February 2017 and Senior Director Finance and Controller from March 2015 to October 2015 at aTyr Pharma, a publicly-traded biotechnology company. Mr. Blake served as the Director, Financial Planning and Analysis of Volcano Corporation, a publicly-traded medical device company, from March 2010 to March 2015 and as the SEC Reporting Manager from November 2008 to March 2010. Mr. Blake is a Certified Public Accountant and holds a BachelorMaster of Business Administration from National University and is a Beta Gamma Sigma scholar atthe Marshall School of Business at the University of Southern California. In addition, Mr. Blake alsohas completed leadership executive education at Harvard Business School and the Strategic Financial Leadership Program at Stanford Graduate School of Business. Edward Randolph
Patrick Ryan Mr. Randolph, 60, hasRyan served as our Vice President of Manufacturing since 2007. From 2003 to 2007, Mr. Randolph was Director of Manufacturing Engineering at Boston Scientific Corp., a worldwide manufacturer of medical devices and products. From 2001 to 2003, Mr. Randolph was a Director of Manufacturing Engineering at Cygnus, Inc., manufacturer of non-invasive transdermal drug delivery systems. Mr. Randolph received his Master of Science in EngineeringChief Operating Officer from Stanford University and his Bachelor of Science in Architecture from Massachusetts Institute of Technology. Stephen Okland
Mr. Okland, 54, has served as our Commercial Vice President, U.S. and Canada since March 2016.August 2018 until April 2020. Prior to that Mr. Okland was with Sanford Rose Associates – Okland Group, Inc., where heRyan served as PresidentChief Operations Officer at Synaptive Medical from January 2016 to March 2018, Chief Operating Officer at Lucerno Dynamics from July 2015 to December 2015 and specialized in commercial executive talent acquisition for early stageInsulet Corporation from January 2014 to mid-cap size companies in the medical device space. Previously, he served as Vice President, Worldwide Marketing and Sales, at Miramar Labs, Inc., a company that develops, manufactures, and distributes medical devices to treat dermatologic medical conditions, where he led all commercialization activities. At Medivance, Inc., Mr. Okland served as Vice President, Worldwide Marketing and U.S. Sales and directed the turnaround of all commercialization activities resulting in a $250 million acquisition by Bard Medical. At Spectranetics, Inc., as Vice President, U.S. Sales and Marketing, he directed all U.S. sales and marketing operations during a period when the company was named to Fortune’s 100 Fastest Growing Companies three years in a row. Mr. OklandJuly 2015. He also served as Chief Operating Officer and President, International, at Alphatec Spine from May 2011 to January 2014. Earlier in Mr. Ryan’s career, he held multiple leadership positions at Guidant and Abbott Vascular, including Divisional Vice President of a medical device start-up company, directing and managing sales, marketing, R&D andWorldwide Operations at Abbott Vascular as well as Vice President & Managing Director for Guidant’s manufacturing operations. He held positions of increasing responsibility during 12 years at Boston Scientific Corporation and at Johnson & Johnson Medical, Inc., where he beganfacility in Ireland. Following his career. He earnedgraduation from the United States Naval Academy with a Bachelor of Science degree in Economics, Mr. Ryan served as an officer in the U.S. Navy. He then received a Master of Science degree in Petroleum Management from the University of Wisconsin and a Masters of Business Administration from Texas Christian University.Kansas.
David Jacques
Mr. Jacques, 55, has served as our Vice President – Research & Development since March 2017. From 2012 through 2016 he was a principal of DMJ Consulting, LLC, a management consulting firm, where his clients included various high tech companies including Second Sight Medical Products, Inc. His duties and responsibilities included analyzing existing and leading edge technologies, aiding in assembly of world class engineering teams, working with management to devise innovative systems and continuous improvement of enterprise systems, and managing multiple complex projects. From 2012 to 2014 Mr. Jacques also was founder and Chief Technology Officer of AcuteTeleCare, LLC, a developer of a next generation, state of the art telemedicine platform to facilitate rapid diagnosis and treatment for patients with acute conditions, such as cerebral stroke. From 2006 to 2012 Mr. Jacques also served as Vice President, Research & Development at Stereotaxis, Inc. where he was the company leader of all engineering teams specializing in organizational evaluation, role identification and structural effectiveness for a high-tech leading edge medical manufacturer. He earned a Bachelor of Science, Electrical Engineering degree from the University of Arizona.
Former Officers
Robert J. Greenberg
Dr. Greenberg, 50, served as Chairman of our Board from August 2015 to March 2018. Prior to that, Dr. Greenberg served as the President, Chief Executive Officer and Director of Second Sight Medical Products, Inc. since its inception until August 2016. Prior to the formation of Second Sight, Dr. Greenberg worked co-managing the Alfred E. Mann Foundation and since February 2007, he has been chairman of that foundation. From 1997 to 1998, he served as lead reviewer for IDEs and 510(k)s at the Office of Device Evaluation at the US Food and Drug Administration in the Neurological Devices Division. In 1998, he received his medical degree from The Johns Hopkins School of Medicine. From 1991 to 1997, Dr. Greenberg conducted pre-clinical trials demonstrating the feasibility of retinal electrical stimulation in patients with retinitis pigmentosa. This work was done at the Wilmer Eye Institute at Johns Hopkins in Baltimore and led to the granting of his Ph.D. from the Johns Hopkins Department of Biomedical Engineering. His undergraduate degree was in Electrical Engineering and Biomedical Engineering from Duke University. Dr. Greenberg resigned from all of positions with the Company, including his position as director, in April 2018.
Thomas B. Miller
Mr. Miller, 61, served as our Chief Financial Officer since May 2014 to March 2018. From 2000 to 2014 he was Chief Financial Officer of Ixia, a public company engaged in the design and manufacture of network test and monitoring products for the telecommunications industry. From 1997 to 1999 he was the Director of Finance and Controller of CoCensys, a public biotechnology company engaged in the discovery and development of new drugs to treat neurological and psychiatric disorders. Mr. Miller received a Master of Business Administration from the University of Southern California and a Bachelor of Arts, Economics from the University of California, Berkeley. Mr. Miller resigned to pursue personal opportunities and ceased to be a full time employee of the Company in March 2018.
Gregoire Cosendai
Mr. Cosendai, 46, served as our Director of European Operations from 2008 to 2010 and has since 2010 been our Vice President of European Operations. Between 2005 and 2008 he acted as a consultant for Second Sight Medical Products, Inc.. From 2001 to 2008 he was director of business development for the Alfred E. Mann Foundation. From 1995 to 2001 he was clinical engineer at the ENT clinic at the Geneva Hospital. Mr. Cosendai received a PhD from EPFL Lausanne on developing new speech coding strategies for cochlear implants and a Master of Electrical Engineering (Ing. dipl. EPFL elec.) from EPFL Lausanne. Mr. Cosendai was released from work in January 2018. Under Swiss notice law he remains on payroll until April 30, 2018.
Summary Compensation Table for 2017 2020 The following table provides information regarding the compensation of our named executive officers, during 2017. As an emerging growth company, we have elected to comply with the executive compensation disclosure rules applicable to “smaller reporting companies,” as such term is defined in the rules promulgated under the Securities Act of 1933, as amended, or the Securities Act, which require compensation disclosure for our principal executive officer and the two most highly compensated executive officers other than our principal executive officer. Individuals listed in the table below are sometimes referred to in this report as the “Named Executive Officers” or “NEOs”. during 2020. The amounts represented in the “Option Awards” column reflect the aggregate grant date fair value of stock awards and option awards granted, calculated in accordance with ASC Topic 718, disregarding the estimate for forfeitures. The assumptions we used for calculating the grant date fair values are set forth in Note 9 of Notes to our consolidated 28
financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 20172018 and does not necessarily equate to the income that will ultimately be realized by the NEOs for such awards. | | | | | Salary | | | Bonus | | | Option Awards | | | Other | | | Total | | Name and Principal Position | | Year | | | ($) | | | ($) | | | ($) | | | ($) | | | ($) | | | | | | | (1) | | | (2) | | | (3) | | | (4) | | | | | | | | | | | | | | | | | | | | | | | | Will McGuire | | 2017 | | | 400,320 | | | 213,070 | | | 605,002 | | | 4,919 | | | 1,223,311 | | Chief Executive Officer(5) | | 2016 | | | 394,000 | | | 86,680 | | | 42,154 | | | 5,451 | | | 528,285 | | | | | | | | | | | | | | | | | | | | | Robert J. Greenberg, M.D., Ph.D. | | 2017 | | | 439,178 | | | 147,820 | | | 246,154 | | | 13,596 | | | 846,748 | | Chairman(5) | | 2016 | | | 394,000 | | | 86,680 | | | 113,975 | | | 13,410 | | | 608,065 | | | | 2015 | | | 338,821 | | | 62,411 | | | 210,000 | | | 8,572 | | | 619,804 | | | | | | | | | | | | | | | | | | | | | Steve Okland | | 2017 | | | 347,375 | | | — | | | 212,006 | | | 56,374 | | | 615,755 | | Commercial Vice President, U.S. and Canada(6) | | 2016 | | | 235,467 | | | — | | | 370,500 | | | 2,108 | | | 608,075 | |
| | | | | Salary | | | Bonus | | | Option Awards | | | Other | | | Total | | Name and Principal Position | | Year | | | ($) | | | ($) | | | ($) | | | ($) | | | ($) | | | | | | | (1) | | | (2) | | | (3) | | | (4) | | | | | Scott Dunbar, Acting CEO | | | 2020 | | | | 255,299 | | | | — | | | | 16,706 | | | | — | | | | 272,005 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Edward Sedo Acting CAO | | | 2020 | | | | 151,079 | | | | — | | | | 5,063 | | | | — | | | | 156,042 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Edward Randolph, Vice President Operations | | | 2020 | | | | 167,496 | | | | — | | | | — | | | | — | | | | 167,496 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Jessy Dorn, Vice President of Clinical and Scientific Affairs | | | 2020 | | | | 233,988 | | | | — | | | | 36,041 | | | | — | | | | 270,029 | | | | | | | | | | | | | | | | | | | | | | | | | | |
1. | 1. | Includes commissions earned and payablevacation amounts in 20172020 of $83,800 and $47,300 in 2016$23,010 for Mr. Okland.Dunbar, $14,905 for Mr. Sedo, $7,965 for Mr. Randolph and $16,949 for Dr. Dorn. |
2. | 2. | Represents the amounts earned and payable as cash bonuses for the indicated year. |
3. | 3. | Represents the aggregate grant date fair value of stock option awards granted during the years shownprorated for respective start dates as measured pursuant to ASC Topic 718 as stock-based compensation in our consolidated financial statements. This calculation does not give effect to any estimate of forfeitures related to service-based vesting but assumes that the executive will perform the requisite service for the award to vest in full. The assumptions we used in valuing equity awards are described in Note 9 to our audited consolidated financial statements included in our Annual Report on Form 10-K, for the fiscal year ended December 31, 2017.2020. |
4. | 4. | Includes contributions to the officer’s retirement plan, and payments for supplemental life and health insurance plans. In addition, in 2015, 2016 and 2017, Dr. Greenberg received an $8,000 per year car allowance. Includes $50,420 in relocation payments to Mr. Okland in 2017. | | 5. | Effective August 18, 2015, Dr. Greenberg was appointed Chairman of the Board and resigned as President and Chief Executive Officer, and Will McGuire joined the Company as Director, President and Chief Executive Officer. Dr. Greenberg ceased to be Chairman in March 2018 and resigned as an Officer and Director in April 2018. | | 6. | Mr. Okland became the Company’s Commercial Vice President, U.S. and Canada in March 2016. |
Executive Officer Employment Agreements
We have no long term employment agreements with any of our executive officers except as noted below and all of our executive officers are at will employees.
We entered into an at-will Executive Employment Agreement as of June 19, 2015 with Will McGuire, our Chief Executive Officer, by which principally we agreed to:
| ● | appoint him Chief Executive Officer and President effective no later than August 18, 2015, |
| ● | pay him an annual starting salary of $390,000, |
| ● | issue him upon Board approval 190,000 RSUs, |
| ● | grant him upon Board approval an option under our equity incentive plan to purchase 420,000 shares of our common stock, |
| ● | make him eligible for annual bonuses at Board discretion, |
| ● | provide him with various benefits including vacation and sick leave, |
| ● | provide life insurance in the amount of $300,000, |
| ● | reimburse reasonable commuting and relocation costs, |
| ● | provide him his annual base salary and targeted bonus if we terminate his employment without cause, or if such employment is terminated as a result of a change of control, for a period of 12 months. |
A copy of our Executive Employment Agreement with Will McGuire is attached as an exhibit to our Form 8-K filed with the Commission on June 25, 2015 and the description above is qualified in its entirety by reference to that agreement.
We entered into an at-will Executive Employment Agreement as of March 21, 2018 with John T. Blake, our Chief Financial Officer, by which principally we agreed to:
| ● | pay him an annual starting salary of $300,000, |
| ● | grant him upon Board approval an option under our equity incentive plan to purchase 500,000 shares of our common stock, |
| ● | make him eligible for annual bonuses at Board discretion, |
| ● | provide him with various benefits including vacation and sick leave, |
| ● | provide life insurance in the amount of $350,000, |
| ● | reimburse reasonable commuting costs, |
| ● | provide him his annual base salary, targeted cash bonus in effect on date of separation from the company and a prorated portion of his target annual bonus for the portion of the calendar year completed prior to the termination date if we terminate his employment without cause, or if such employment is terminated as a result of a change of control, for a period of 12 months, | | ● | reimburse up to $100,000 to a prior employer for certain education expenses repayable on a prorated basis if he fails to stay with the company for at least three years. |
A copy of our Executive Employment Agreement with John T. Blake is attached as an exhibit to our Form 8-K filed with the Commission on March 27, 2018 and the description above is qualified in its entirety by reference to that agreement.
In December 2016 the Board of Directors approved the following executive and management compensation policies:
● Adopted a “double-trigger” change of control severance plan for the company’s then executive Chairman, Chief Executive Officer and officers who report directly to the Chief Executive Officer. The two triggers for payment of severance are (1) a change of control and (2) a “qualifying” termination, which would be termination without cause by a buyer or a voluntary resignation for good reason. A change of control is defined to include (i) an acquisition or merger in which 50% or more of outstanding voting power changes hands, and (ii) a transaction in which the sale of all or substantially all of the company’s assets occurs.
● For the company’s then executive Chairman and Chief Executive Officer, cash severance includes one year of salary continuation, bonus equal to a prorated amount for the year-to-date bonus earned but not yet paid, 100% of target bonus for the cash severance period, and a continuation of health insurance benefits for the severance period. For officers who report directly to the Chief Executive Officer, cash severance includes six months of salary continuation, bonus equal to a prorated amount for the year-to-date bonus earned but not yet paid, 100% of target bonus for the cash severance period, and a continuation of health insurance benefits for the severance period.
These severance provisions relate to company executives and not to the current non-executive Chairmen who is an outside director. All of the option awards and stock awards granted to the Company’s executives include change-in-control arrangements whereby any unvested stock options would vest as a result of change in control.
OUTSTANDING EQUITY AWARDS AT 20172020 FISCAL YEAR-END The following table sets forth certain information concerning outstanding unexercised, unvested, and/or unearned equity awards that were outstandingheld as of December 31, 20172020 by our named executive officers. Unless otherwise noted, all awards expire 10 years after the grant date. | | | | | | | | | | | | | | | | | | | | | | OPTION AWARDS | | | STOCK AWARDS | | Name | | Option Grant Date | | Number of Securities Underlying Unexercised Options Exercisable | | | Number of Securities Underlying Unexercised Options Unexercisable | | | Option Exercise Price ($) | | | Stock Award Grant Date | | Number of Shares or Units of Stock That Have Not Vested | | | Market Value of Shares or Units of Stock That Have Not Vested($) | | | | | | | | | | | | | | | | | | | | | | | | | | | Will McGuire | | 1/3/2017 | | | — | | | | 571,330 | (2) | | | 1.97 | | | 8/17/2015 | | | 106,875 | (3) | | | 204,131 | | | | 1/21/2016 | | | 9,315 | | | | 11,975 | (2) | | | 4.10 | | | | | | | | | | | | | | 8/17/2015 | | | 236,250 | | | | 183,750 | (2) | | | 12.43 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Robert J. Greenberg, M.D., Ph.D. | | 1/3/2017 | | | — | | | | 256,410 | (2) | | | 1.97 | | | | | | | | | | | | | | 1/21/2016 | | | 25,184 | | | | 32,379 | (2) | | | 4.10 | | | | | | | | | | | | | | 3/25/2015 | | | 15,626 | | | | 15,624 | (1) | | | 13.09 | | | | | | | | | | | | | | 9/26/2014 | | | 310,995 | | | | 103,664 | (1) | | | 9.00 | | | | | | | | | | | | | | 4/1/2014 | | | 35,157 | | | | 11,718 | (1) | | | 5.00 | | | | | | | | | | | | | | 3/1/2012 | | | 38,750 | | | | — | | | | 5.00 | | | | | | | | | | | | | | 3/1/2011 | | | 41,563 | | | | — | | | | 5.00 | | | | | | | | | | | | | | 2/1/2010 | | | 103,750 | | | | — | | | | 5.00 | | | | | | | | | | | | | | 2/1/2009 | | | 33,750 | | | | — | | | | 5.00 | | | | | | | | | | | | | | 11/1/2008 | | | 150,000 | | | | — | | | | 5.00 | | | | | | | | | | | | | | 2/1/2008 | | | 23,750 | | | | — | | | | 5.00 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Stephen Okland | | 1/3/2017 | | | — | | | | 220,840 | (2) | | | 1.97 | | | | | | | | | | | | | | 4/4/2016 | | | 56,250 | | | | 93,750 | (2) | | | 5.16 | | | | | | | | | | | |
| | OPTION AWARDS | | | | | | | Number of Securities Underlying Unexercised Options Exercisable | | | Number of Securities Underlying Unexercised Options Unexercisable | | | | | Option | | | Name | | Option Grant Date | | | | | | | | Exercise Price ($) | | | Jessy Dorn | | 04/01/2014 | | | 656 | | | | — | | | | | | 40.00 | | | | | 03/25/2015 | | | 468 | | | | — | | | | | | 104.72 | | | | | 05/15/2015 | | | 2,500 | | | | — | | | | | | 99.68 | | | | | 01/14/2016 | | | 1,875 | | | | — | | | | | | 33.44 | | | | | 01/21/2016 | | | 1,151 | | | | — | | | | | | 32.80 | | | | | 01/18/2017 | | | 2,344 | | | | 156 | (1) | | | | | 13.84 | | | | | 01/02/2018 | | | 1,719 | | | | 781 | (2) | | | | | 16.08 | | | | | 01/23/2019 | | | 1,965 | | | | 1.135 | (2) | | | | | 6.52 | | | | | 06/04/2019 | | | 3,516 | | | | 5,589 | (2) | | | | | 5.67 | | | | | 02/12/2020 | | | 1,854 | | | | 7,045 | (2) | | | | | 5.98 | | | | | | | | | | | | | | | | | | | | | Scott Dunbar | | 03/01/2011 | | | 831 | | | | — | | | | | | 40.00 | | | | | 03/01/2012 | | | 775 | | | | — | | | | | | 40.00 | | | | | 04/01/2014 | | | 937 | | | | — | | | | | | 40.00 | | | | | 09/26/2014 | | | 5,305 | | | | — | | | | | | 72.00 | | | | | 03/25/2015 | | | 625 | | | | — | | | | | | 104.72 | | | | | 01/21/2016 | | | 1,151 | | | | — | | | | | | 32.80 | | | | | 01/18/2017 | | | 2,344 | | | | 156 | (1) | | | | | 13.84 | | | | | 01/02/2018 | | | 1,719 | | | | 781 | (2) | | | | | 16.08 | | | | | 01/23/2019 | | | 1,965 | | | | 1.135 | (2) | | | | | 6.52 | | | | | 02/12/2020 | | | 859 | | | | 3,266 | (2) | | | | | 5.98 | | | | | | | | | | | | | | | | | | | | | Edward Sedo | | 09/03/2015 | | | 1,250 | | | | — | | | | | | 72.08 | | | | | 01/21/2016 | | | 156 | | | | — | | | | | | 32.80 | | | | | 01/18/2017 | | | 586 | | | | 39 | (1) | | | | | 13.84 | | | | | 01/02/2018 | | | 322 | | | | 146 | (2) | | | | | 16.08 | | | | | 01/23/2019 | | | 590 | | | | 660 | (2) | | | | | 6.52 | | | | | 02/12/2020 | | | 260 | | | | 990 | (2) | | | | | 5.98 | | |
(1) | 1. | Vest in equal annual tranches on the first four anniversary dates of the grant. |
| 2. | Vests over a four year term, with 25% vesting on the one year anniversary date of the grant andwith the remaining options vesting quarterly over three years thereafter, vesting in 12 equal quarterly installments of 6.25%.subject to continuous employment. |
(2) | 3. | Vests over a four year term, with 25%equal amounts vesting on the one year anniversary of Mr. McGuire’s employment start date andmonthly over 4 years thereafter, vesting in 12 equal quarterly installments of 6.25% on the quarterly anniversaries of Mr. McGuire’s start date.subject to continuous employment. |
Equity Compensation Plan Information We currently maintain equity compensation plans that provide for the issuance of our common stockCommon Stock to our officers, employees, and certain consultants upon the exercise or vesting of stock options and upon the vesting of restricted stock units. These plans are:are our: The 2003 Equity Incentive Plan, as restated in June 2011 (the “2003 Plan”). | ● | The 2011 Equity Incentive Plan, as restated in June 2011 (the “2003 Plan”). |
| ● | The 2011 Equity Incentive Plan (the “2011 Plan”). |
| ● | 2015 Employee Stock Purchase Plan (the “2015 ESPP”). |
| ● | Equity Incentive Plan – Restricted Stock Units (the “RSU Plan”). |
The 2011 Equity Incentive Plan (the “2011 Plan”). 2015 Employee Stock Purchase Plan (the “2015 ESPP”). Equity Incentive Plan – Restricted Stock Units (the “RSU Plan”). The 2003 Plan and the 2011 Plan have been approved by our shareholders. The RSU Plan was adopted by our Board on December 1, 2015, in connection with a grant of 190,000 inducement restricted stock units granted to the Will McGuire, the Company’sour former President and Chief Executive Officer, upon joining the Company. The following table summarizes information about outstanding stock options, restricted stock units, and shares reserved for future issuance as of December 31, 20172020 under the Company’s equity incentive plans described above: Plan Category | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | | | Weighted-average exercise price of outstanding options, warrants and rights(1) | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | | | | (a) | | | (b) | | | (c) | | Equity compensation plans approved by security holders: | | | | | | | | | | | | | | | | | | | | | | | | | | 2011 Plan(2) | | | 5,675,446 | | | $ | 4.87 | | | | 2,504,873 | | | | | | | | | | | | | | | 2015 ESPP (3) | | | — | | | | — | | | | 301,466 | | | | | | | | | | | | | | | | | | 5,675,446 | | | $ | 4.87 | | | | 2,806,339 | | Equity compensation plans not approved by security holders: | | | | | | | | | | | | | | | | | | | | | | | | | | RSU Plan | | | 83,125 | | | $ | — | | | | — | | | | | | | | | | | | | | | Total | | | 5,758,571 | | | $ | 4.87 | | | | 2,806,339 | |
Plan Category | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | | | Weighted–average exercise price of outstanding options, warrants and rights | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | | | | (a) | | | (b) | | | (c) | | Equity compensation plans approved by security holders: | | | | | | | | | | | | | 2011 Plan (1) | | | 196,389 | | | $ | 15.48 | | | | 1,063,396 | | 2015 ESPP (2) | | | — | | | | — | | | | 77,031 | | | | | | | | $ | — | | | | | | | | | | | | | | | | | | | | | | | | | $ | — | | | | | | Total | | | 196,389 | | | $ | 15.48 | | | | 1,140,427 | |
1.(1) | The weighted-average exercise price of outstanding options does not take into account outstanding RSUs since they do not have an exercise price. |
2. | All such shares are issuable upon the exercise of outstanding stock options. |
3. | On January 1 of each year, the number of shares authorized and reserved for issuance under the 2015 ESPP automatically increases by the lesser of (i) 100,000 shares; or (ii) a number of shares equal to 1.0% of the Company’s outstanding shares on the last day of our prior fiscal year. On January 1, 2018, the number of shares authorized and reserved for issuance under the 2015 ESPP was increased by 100,000 shares. |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows information known to us about beneficial ownership of our common stock by: each of our current named executive officers as well as any additional individuals identified as named executive officers in the section of this report titled “Executive Compensation”; | ● | each of our current named executive officers as well as any additional individuals identified as named executive officers in the section of this report titled “Executive Compensation”; |
all of our directors and executive officers as a group; and | ● | all of our directors and executive officers as a group; and |
each person known by us to beneficially own 5% or more of our common stock. | ● | each person known by us to beneficially own 5% or more of our common stock. |
The column entitled “Percentage Beneficially Owned” is based on a total of 59,875,71727,908,299 shares of our common stock outstanding as of March 31, 2018. 2021. Beneficial ownership and percentage ownership are determined in accordance with the rules of the SEC. Under these rules, beneficial ownership generally includes any shares as to which the individual or entity has sole or shared voting power or investment power and includes any shares that an individual or entity has the right to acquire beneficial ownership of within 60 days of March 31, 20182021 through the exercise of any option, warrant, conversion privilege or similar right. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of our common stock that could be issued upon the exercise of outstanding options and warrants that are exercisable within 60 days of March 31, 20182021 are considered to be outstanding. These shares, however, are not considered outstanding asand beneficially owned by the person holding those options or warrants for the purpose of March 31, 2018 when computing the percentage ownership of eachthat person, but they are not treated as outstanding for the purpose of computing the percentage ownership of any other person. | | Number of Shares | | | Percentage | | Name and address of Beneficial Owners(1) | | Beneficially Owned | | | Beneficially Owned | | Gregg Williams (2) | | | 15,946,341 | | | | 47.0 | % | Aaron Mendelsohn (3) | | | 27,055 | | | | * | % | Matthew Pfeffer (4) | | | 25,813 | | | * | % | Jonathan Will McGuire (5) | | | 22,186 | | | * | % | Jessy Dorn (6) | | | 20,043 | | | * | % | Scott Dunbar (7) | | | 19,861 | | | * | % | Edward Sedo (8) | | | 3,418 | | | * | % | Edward Randolph (9) | | | 2 | | | * | % | All current directors and executive officers as a group (8) persons) (10) | | | 16,064,786 | | | 47.2 | % |
Name of Beneficial Owner | | Number of Shares Beneficially Owned | | | Percentage Beneficially Owned | | | | | | | | | Gregg Williams(1) | | 26,285,293 | | | 39.4 | % | William J. Link(2) | | 4,573,643 | | | 7.6 | % | Robert J. Greenberg, M.D., Ph.D.(3) | | 1,034,540 | | | 1.7 | % | Jonathan Will McGuire(4) | | 586,934 | | | 1.0 | % | Edward Randolph(5) | | 187,350 | | | | * | Steve Okland(6) | | 167,654 | | | | * | Aaron Mendelsohn(7) | | 104,365 | | | | * | Matthew Pfeffer(8) | | 88,350 | | | | * | David Jacques(9) | | 37,500 | | | | * | | | | | | | | All current directors and executive officers as a group (9 persons)(10) | | 33,065,629 | | | 48.3 | % |
* | * | Represents beneficial ownership of less than one percent. |
1. | 1.Unless otherwise noted below, the address of each beneficial owner is c/o Second Sight Medical Products Inc., 13170 Telfair Avenue, Sylmar, California 91342. |
2. | IncludesShares beneficially owned by Mr. Williams include (i) 4,358,0823,513,556 shares heldof common stock and warrants to purchase 1,713,599 shares of common stock owned by theGW Trust, (ii) 3,638,566 shares of common stock and warrants to purchase 3,453,036 shares of common stock owned by Williams International Co. LLC (iii) 544,760 shares of common stock owned by Sam Williams Family Investments LLC (ii) 1,484,254and (iv) 2,193,928 shares of common stock and warrants to purchase 863,260 shares of common stock owned by Williams International Co., LLC and (iii) 13,598,612 shares owned by the Gregg G. Williams 2006 Trust and 6,802,721GST. Includes 25,636 shares of common stock issuable to Greg G.Mr. Williams 2006 Trust upon exercise of warrants and (iv) Sam B. Williams 95 GST Trust, owns 41,624 shares of common stock.options. Greg Williams has voting and dispositive power over all of these shares. |
3. | 2. | Includes 4,370,96416,724 shares held by Versant Venture Capital II, L.P.(“VVC”), 82,949 shares held by Versant Affiliates Fund II-A, L.P. (“VAF”), 39,062 shares held by Versant Side Fund II, L.P., and 80,668 shares held directlyowned by Mr. Link.Mendelsohn and 10,331 shares of common stock issuable to Mr. Link is managing directorMendelsohn upon exercise of Versant Ventures II, LLC, the general partneroptions. | 4. | Includes 14,785 shares owned by Mr. Pfeffer and 697 shares and 10,331 shares of VVC, VAFcommon stock issuable to Mr. Pfeffer upon exercise of warrants and VSF and may be deemed a beneficial ownerexercise of these shares.options, respectively. |
5. | 3. | Includes 861,62920,469 shares subject to options held by Dr. Greenberg which are exercisable or become exercisable within 60 days of March 31, 2018. |
| 4. | Includes 491,142 shares subject to options heldowned by Mr. McGuire which are exercisable or become exercisable within 60 days of March 31, 2018 and 6,7941,717 shares of common stock issuable to Mr. McGuire upon exercise of warrants. |
6. | 5. | Includes 187,328182 shares subject to options held by Mr. Randolph which are exercisable or become exercisable within 60 daysDr. Dorn and 19,861 shares common stock issuable to Dr. Dorn upon exercise of March 31, 2018.warrants. |
7. | 6. | Includes 144,013 shares subject to options held by Mr. Okland which are exercisable or become exercisable within 60 days of March 31, 2018. |
| 7. | Includes 104,3652,383 shares owned by Mr. Mendelsohn individually. |
| 8. | Includes 5,582Dunbar and 935 shares and 16,610 shares of common stock issuable to Mr. PfefferDunbar upon exercise of warrants.warrants and exercise of options, respectively. |
8. | Include 3,418 shares of common stock issuable to Mr. Sedo upon exercise of warrants. |
9. | Includes 37,5002 shares subject to options held by Mr. Jacques which are exercisable or become exercisable within 60 days of March 31, 2018Randolph. |
10. | 10. | Includes all of the shares described in notes 12 through 9 above. |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Policies and Procedures for Related Party Transactions Our Audit Committee is responsible for reviewing any related party transactions of the Company, which we define as transactions between us and our executive officers, directors, nominees for election as directors, beneficial owners of more than 5% of any class of our common stock and any member of the immediate family of any of the foregoing persons where the aggregate amount involved will or may be expected to exceed $120,000 in any calendar year. In approving or rejecting any such proposal, our Audit Committee considers the facts and circumstances available and deemed relevant by our Committee, including, but not limited to, whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related party’s interest in the transaction. Related Party Transactions In addition to the compensation arrangements, including employment, termination of employment and change in control arrangements discussed above in the sections titled “Board of Directors and Corporate Governance – Director Compensation” and “Executive Compensation,” we describe below transactions and series of similar transactions, since the beginning of our last fiscal year, to which we were a party or will be a party, in which: the amounts involved exceeded or will exceed $120,000; and any of our directors, nominees for director, executive officers or holders of more than 5% of our outstanding capital stock, or any immediate family member of, or person sharing the household with, any of these individuals or entities, had or will have a direct or indirect material interest. Private Placements On March 23, 2021, we entered into a securities purchase agreement for a private placement with several investors, wherein a total of 4,650,000 shares of the Company’s common stock, no par value per share (the “Common Stock”), were issued at a purchase price of $6.00 per share (the “Private Placement”). Gross proceeds from the Private Placement, which closed on March 26, 2021, were $27,900,000 before placement agent fees, legal fees, and other offering expenses. See our Form 8-K filed with the SEC on March 26, 2021. Other Transactions We have granted stock options to our named executive officers and certain of our directors. See the sections titled “Board of Directors and Corporate Governance – Director Compensation” and “Executive Compensation,” for a description of these stock options. Office Lease
Our principal office and facilities are located at 12744 San Fernando Road, Suite 400, Sylmar, California 91342, and consists of approximately 45,351 rentable square feet at a base rent of approximately $36,600 per month. Our lease expires in February 2022 and grants us an option to extend the lease term for an additional 60 months period. We believe that these premises are adequate for our foreseeable needs.
Our European office is located on the Innovation Park at EPFL, Rue Jean Daniel Colladon, CH 1015 Lausanne. The lease consists of 180 square meters at a base rent of 8,200 CHF per month, or currently about $8,700 per month. Our lease is currently monthly with a six month notice required for termination, with the Foundation for the Innovation Park at EPFL.
REQUIREMENTS FOR ADVANCE NOTIFICATION OF STOCKHOLDER PROPOSALS FOR 2018 ANNUAL MEETING
For any stockholder proposal, to be considered for inclusion in our proxy statement and form of proxy for submission to the stockholdersshareholders at our 20192021 annual meeting, it must be submitted in writing and comply with the requirements of Rule 14a-8 of the Securities Exchange Act of 1934. Such proposalsTo be timely submitted for our 2022 annual meeting but not included in the Company’s proxy statement, any such proposal must be received bydelivered in writing to our Corporate Secretary at the principal executive offices of the Company at its offices at 12744 San Fernando Road, Suite 400, Sylmar, California 91342not later than the close of business on or before December 14, 2018. the ninetieth (90th) day nor earlier than the close of business on the one hundred twentieth (120th) day prior to May 28, 2022 (the one year anniversary of the preceding year’s annual meeting.)Our Board will review any proposals from eligible stockholders that it timely receives by that date and will make a determination whether any such proposals will be included in our proxy materials. Any proposal received after that date shall be considered untimely and shall not be made a part of our proxy materials. A stockholder who wishes to make a proposal at the next annual meeting without including the proposal in our proxy statement must also notify us within a reasonable time before we print and mail the proxy materials. If a stockholder fails to give reasonable advance notice, then the persons named as proxies in the proxies solicited by us for the next annual meeting will have discretionary authority to vote on the proposal. 34
STOCKHOLDER MOTHER MATTERSATTERS
TheOur Board does not intend to bringknow of any other matters beforeto be presented at the Annual Meeting and has no reason to believeMeeting. If any other matters will be presented. If otheradditional matters properly do come before the Annual Meeting, however, it is the intention of the persons named as proxy agents in the enclosed proxy card to vote on such matters as recommended by the Board, ofor if no recommendation is given, in their own discretion.
The Company’sOur consolidated financial statements for the fiscal year ended December 31, 2020 are included in our Annual Report on Form 10-K for the year ended December 31, 2017 is being mailed with10-K. Our Annual Report and this Proxy Statement are posted on our website at www.secondsight.com and are available from the SEC at its website at www.sec.gov. You may also obtain a copy of our Annual Report without charge by sending a written request to stockholders entitled to notice of the Annual Meeting.Investor Relations, Second Sight Medical Products, Inc., 13170 Telfair Avenue, Suite 400, Sylmar, California 91342. The Annual Report includes the financial statements and management’s discussion and analysis of financial condition and results of operations. The costs of preparing, assembling, mailing and soliciting the proxies will be borne by us. Proxies may be solicited, without extra compensation, by our officers and employees by mail, telephone, facsimile, personal interviews and other methods of communication.
If you and other residents at your mailing address own shares in street name, your broker or bank may have sent you a notice that your household will receive only one copy of proxy materials for each company in which you hold shares through that broker or bank. This practice of sending only one copy of proxy materials is known as householding. If you did not respond that you did not want to participate in householding, you were deemed to have consented to the process. If the foregoing procedures apply to you, your broker has sent one copy of our Proxy Statement to your address. If you want to receive separate copies of the proxy materials in the future, or you are receiving multiple copies and would like to receive only one copy per household, you should contact your stockbroker, bank or other nominee record holder, or you may contact us at the address or telephone number below. In any event, if you did not receive an individual copy of this Proxy Statement,proxy statement, we will send a copy to you if you address your written request to, or call, John T. Blake, Chief Financial Officer and Corporate Secretary of Second Sight Medical Products, Inc, 12744 San Fernando Road, Suite 400,13170 Telfair Avenue, Sylmar, California 91342, telephone number (818) 833-5000. It is important that your shares of our common stock be represented at the Annual Meeting, regardless of the number of shares that you hold. You are, therefore, requested to vote by telephone or by using the Internet as instructed on the enclosed proxy card or execute and return, at your earliest convenience, the enclosed proxy card in the envelope that has also been provided. THE BOARD OF DIRECTORS Los Angeles, California April 30, 2021
Copies of the documents referred to above that appear on our website are also available upon request by any stockholdershareholder addressed to our Corporate Secretary, Second Sight Medical Products, Inc., 12744 San Fernando Road, Suite 400,13170 Telfair Avenue, Sylmar, California 91342. | VOTE ON INTERNET Go to http://www.proxypush.com/EYES Go tohttp://www.proxyvote.com and log-on using the below control number.
| | | | CONTROL # | | | * SPECIMEN *
1 MAIN STREET
ANYWHERE PA 99999-9999 | VOTE BY MAIL Mark, sign and date your proxy card and
return it in the envelope we have provided. | | | | VOTE IN PERSON If you would like to vote in person, please
attend the Annual Meeting to be held on
May 16, 201828, 2021 at 10:00 a.m. | | |
Please Vote, Sign, Date and Return Promptly in the Enclosed Envelope. 36
Annual Meeting Proxy Card - Common Stock ▼ DETACH PROXY CARD HERE TO VOTE BY MAIL ▼ (1) | | | | | | (1) | Election of Directors: | | | | | | ☐ | FOR ALL NOMINEES LISTED BELOW
(except as marked to the contrary below) | ☐ | WITHHOLD AUTHORITY TO VOTE FOR
ALL NOMINEES LISTED BELOW | | | | | | | | INSTRUCTION: INSTRUCTION:TO WITHHOLD AUTHORITY TO VOTE FOR ONE OR MORE INDIVIDUAL NOMINEES STRIKE A LINE THROUGH THE NOMINEES’ NAMES BELOW: | | | | 1a Gregg Williams 1b Aaron Mendelsohn 1c Will McGuire | 1b William J. Link 1c Gregg Williams | | 1d Aaron Mendelsohn | 1e Matthew Pfeffer | 1e Dean Baker 1d Alexandra Larson | | | | | | | Second Sight Medical Products, Inc. proxy holders reserve the right to cumulate votes and cast such votes in favor of the election of some or all of the nominees in their sole discretion. If you wish to cumulate your votes, please mark here and write in your instructions on the reverse side.☐ | | | | | | | (2) | To approve an amendment to our 2011 Equity Incentive Plan that will increase the maximum number of shares of common stock that may be issued under the Plan to 12 million shares. | | ☐ VOTE FOR ☐ VOTE AGAINST ☐ ABSTAIN | | | (3) | To approve an amendment to the 2015 Employee Stock Purchase Plan that will increase the maximum stated number of shares of common stock which may be issued under the plan to 1,550,000 shares and increase annual evergreen amount to 500,000 shares. | | ☐ VOTE FOR ☐ VOTE AGAINST ☐ ABSTAIN | | | (4) | To ratify on an advisory basis the appointment of Gumbiner Savett Inc. as our independent registered public accounting firm for 2018.the fiscal year ending December 31, 2021. | | ☐ VOTE FOR ☐ VOTE AGAINST ☐ ABSTAIN | | |
Date(3) | To approve on advisory basis, the compensation of named executive officers as disclosed in the proxy statement | | Signature☐ VOTE FOR ☐ VOTE AGAINST ☐ ABSTAIN | | | (4) | To indicate on advisory basis the preferred frequency of shareholders votes on the compensation of named executive officers | | ☐ 1 Year ☐ 2 Years ☐ Three Years ☐ ABSTAIN | | | | | | Date | | Signature | | Signature, if held jointly | | | | | | | | | | | | | | | | | | | | | | | | | |
Note: This proxy must be signed exactly as the name appears hereon. When shares are held jointly, each holder should sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by a duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership name by an authorized person. To change the address on your account, please check
the box at right and indicate your new address. | ☐ | | |
SECOND SIGHT MEDICAL PRODUCTS, INC.
ANNUAL GENERAL MEETING OF THE STOCKHOLDERS
May 16, 201828, 2021, 2021
SECOND SIGHT MEDICAL PRODUCTS, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned, revoking all prior proxies, hereby appoints Will McGuire, PresidentScott Dunbar, and Chief Executive Officer, and John T. Blake, Chief Financial Officer,Edward Sedo, or either of them, with full power of substitution to each of them, as proxies to represent and vote all shares of common stock of Second Sight Medical Products, Inc. (the “Company”), which the undersigned will be entitled to vote if personally present at the Annual Meeting of StockholdersShareholders of the Company to be held on May 16, 2018,28, 2021, at 10:00 a.m. exclusively online via the Internet at Second Sight Medical Products, Inc. offices, 12744 San Fernando Road, Suite 400, Sylmar, California, USA, 91342a virtual web conference at www.proxydocs.com/EYES and at any adjournments or postponements thereof. In order to attend the meeting you must register at www.proxydocs.com/EYES. The proxies are further authorized to vote, in their discretion, upon such other business as may properly come before the meeting. This proxy, when properly executed, will be voted as directed. If no direction is made, the proxy shall be votedFOR Items 1, 2, 3 and 4 in accordance with the election of the five (5) nominees,FOR approval of an amendment to the 2011 Equity Incentive Plan that will increase the maximum number of shares of common stock that may be issued under the Plan to 12 million shares of common stock,FOR approval of an amendment to the 2015 Employee Stock Purchase Plan that will increase the maximum stated number of shares of common stock which may be issued under the plan to 1,550,000 shares and increase annual evergreen amount to 500,000 shares,FOR ratification of the Company’s independent registered public accounting firm for 2018Board’s recommendations and, in the case of other matters that legally come before the meeting, as said proxy(s) may deem advisable. Please check here if you plan to attend the Annual Meeting of Stockholders on May 16, 2018 at 10:00 AM. ☐
(Continued and to be signed on Reverse Side) |