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Chicago, Illinois
March 26, 2019
By order of the Board of Directors, | |||||||||||
Paul R. Edick | |||||||||||
Chairman and Chief Executive Officer | |||||||||||
Chicago, Illinois | |||||||||||
April 29, 2021 |
Page | |||||||||||||
PROPOSAL NO. 1 | |||||||||||||
PROPOSAL NO. 2 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, | |||||||||||||
CORPORATE GOVERNANCE | |||||||||||||
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | |||||||||||||
PRINCIPAL STOCKHOLDERS | |||||||||||||
DELINQUENT SECTION 16(A) REPORTS | |||||||||||||
REPORT OF THE AUDIT COMMITTEE | |||||||||||||
HOUSEHOLDING | |||||||||||||
STOCKHOLDER PROPOSALS | |||||||||||||
OTHER MATTERS |
i
2021
April
29, 2021.2021:
April 19, 2021.
How do I vote?
In Person
If you are a stockholder of record, you may vote in person atmy shares without attending the Annual Meeting. We will give you a ballot when you arrive. If you hold your shares through a bank or broker and wish to vote in person at the meeting, you must obtain a valid proxy from the firm that holds your shares.
Meeting?
Corporate Secretary.
Under the General Corporation Law of the State of Delaware, shares that are voted “abstain” or “withheld” and broker “non-votes” are counted as present for purposes of determining whether a quorum is present at the Annual Meeting. If a quorum is not present, the meeting may be adjourned until a quorum is obtained.
materials. If that happens, we will publicly announce the deadline for submitting a proposal in a press release or in a document filed with the SEC.
•the classClass I directors are BJ Bormann Jonathan Rigby and John Schmid, and their terms will expire at the Annual Meeting;
Name | Positions and Offices Held with Xeris | Director Since | Age | |||||||
BJ Bormann | Director | 2018 | 60 | |||||||
John Schmid | Director | 2017 | 56 |
BJ Bormann, Ph.D.Dr. Bormann has served on our board of directors since April 2018. Dr. Bormann currently serves as the vice president of translational science and network alliances for The Jackson Laboratory. From 2015 to 2017, Dr. Bormann served as the interim chief executive officer of Supportive Therapeutics, LLC. In 2015, Dr. Bormann served as the chief executive officer and as a director of Pivot Pharmaceuticals Inc. Previously Dr. Bormann served as the chief business advisor for NanoMedical Systems, Inc. from 2013 to 2015 and as the chief executive officer of Harbour Antibodies from 2013 to 2014. From 2007 to 2013, Dr. Bormann was a senior vice president, world-wide alliances, licensing and business development at Boehringer Ingelheim
Pharmaceuticals, Inc. Dr. Bormann currently serves on the board of directors of BioLine Rx Ltd.
Dr. Bormann received her Ph.D. in biomedical science from the University of Connecticut Health Center and her B.Sc. from Fairfield University in biology. Dr. Bormann completed postdoctoral training at Yale Medical School in the department of pathology. We believe Dr. Bormann is qualified to serve on our board of directors because of her experience in the industry in which we operate.
John Schmid. Mr. Schmid has served on our board of directors since September 2017 and has been our Lead Independent Director since February 2019. Mr. Schmid currently serves as a member of the board of directors of Neos Therapeutics, Inc., AnaptysBio Inc., Forge Therapeutics, Inc., Patara Pharma, Inc., Speak, Inc. and Poseida Therapeutics Inc. Previously, he was the chief financial officer of Auspex Pharmaceuticals, Inc. from 2013 until its acquisition in 2015. Prior to joining Auspex Pharmaceuticals, Mr. Schmid co-founded Trius Therapeutics, Inc. in 2004, where he served as chief financial officer until its sale in 2013.
Mr. Schmid received a B.A. in economics from Wesleyan University and an M.B.A. from the University of San Diego. We believe Mr. Schmid is qualified to serve on our board of directors because of his experience, including financial experience, in the industry in which we operate.
Vote Required and Board of Directors’ Recommendation
To be elected, the directors nominated via Proposal No. 1 must receive a plurality of the votes cast and entitled to vote on the proposal, meaning that the director nominees receiving the most votes will be elected. Shares voting “withheld” have no effect on the election of directors.
The proxies will be voted in favor of the above nominees unless a contrary specification is made in the proxy. The nominees have consented to serve as our directors if elected. However, if the nominees are unable to serve or for good cause will not serve as a director, the proxies will be voted for the election of such substitute nominee as our board of directors may designate.
The proposal for the election of directors relates solely to the election of Class I directors nominated by our board of directors.
The board of directors recommends voting “FOR” the election of John Schmid and BJ Bormann, Ph.D. as the class I directors, to serve for a three-year term ending at the annual meeting of stockholders to be held in 2022.
Directors Continuing in Office
The following table and biographies identify our directors and set forth their principal occupation and business experience during the last five years and their ages as of March 11, 2019.
Name | Positions and Offices Held with Xeris | Director Since | Class and Year in Which Term Will Expire | Age | ||||||||
Jonathan Rigby | Director | 2016 | Class I – 2019 | 51 | ||||||||
Dawn Halkuff | Director | 2018 | Class II – 2020 | 48 | ||||||||
Jeffrey Sherman | Director | 2018 | Class II – 2020 | 64 | ||||||||
Paul Edick | Director | 2017 | Class III – 2021 | 63 | ||||||||
Marla Persky | Director | 2018 | Class III – 2021 | 63 |
Name | Positions and Offices Held with Xeris | Director Since | Age | |||||||||||||||||
Paul R. Edick | Chief Executive Officer and Chairman of the Board | 2017 | 65 | |||||||||||||||||
Marla S. Persky | Director | 2018 | 65 |
Class I Directors (Term Expires at 2019 Annual Meeting)
Jonathan Rigby. Mr. Rigby has served on our board of directors since March 2016. In 2011, Mr. Rigby founded SteadyMed Therapeutics Inc. and has since served as its president, chief executive officer and director. Mr. Rigby led the sale of SteadyMed to United Therapeutics in August 2019. SteadyMed subsequently became a subsidiary of United Therapeutics, and Mr. Rigby continues to serve as president and chief executive officer. Prior to founding SteadyMed, Mr. Rigby cofounded Zogenix Inc., a specialty pharmaceutical company focused on the development and commercialization of central nervous system and pain products, where he served as its vice president of business development from 2006 until December 2011. Mr. Rigby also serves as the chairman of the board of CollPlant Inc.
Mr. Rigby has a B.S. degree in biological sciences from Sheffield University (UK) and an M.B.A. from Portsmouth University (UK)
Class II Directors (Term Expires at 2020 Annual Meeting)
Dawn Halkuff.Ms. Halkuff has served on our board of directors since April 2018. Since 2016, Ms. Halkuff has served as the chief commercial officer of TherapeuticsMD, Inc. Prior to that, Ms. Halkuff held numerous senior level positions at Pfizer, Inc. and the Pfizer Consumer Healthcare Wellness Organization and was a member of its Consumer Global Leadership Team, including roles as senior vice president, global wellness, vice president, women’s health sales and marketing and senior director, women’s health products. Prior to that, Ms. Halkuff was the commercial lead for sales and marketing of the Pfizer’s Women’s Health Division. From 2005 to 2010, Ms. Halkuff was head of global innovation at Weight Watchers International.
Ms. Halkuff has a B.A. degree in psychology from University of Connecticut and an M.B.A. from Pennsylvania State University. We believe Ms. Halkuff is qualified to serve on our board of directors because of her experience in the industry in which we operate.
Jeffrey Sherman, M.D., FACP.Dr. Sherman has served on our board of directors since April 2018. Since 2009, Dr. Sherman has served as the chief medical officer and executive vice president at Horizon Pharma plc. Dr. Sherman serves on the board of directors of Strongbridge Biopharma plc., as a member of a number of professional societies, as a diplomat of the National Board of Medical Examiners and the American Board of Internal Medicine, and on the Board of Advisors of the Center for Information and Study on Clinical Research Participation. He previously held positions at IDM Pharma Takeda Global Research and Development, NeoPharm, Searle/Pharmacia, and Bristol-Myers Squibb and is past president of the Drug Information Association.
Dr. Sherman received a B.A. in Biology from Lake Forest College and earned his M.D. from the Rosalind Franklin University of Medicine and Science/The Chicago Medical School. Dr. Sherman completed internship and residency programs at Northwestern University Feinberg School of Medicine, where he currently serves as an adjunct assistant professor, and a fellowship program at the University of California San Francisco. We believe Dr. Sherman is qualified to serve on our board of directors because of his experience in the industry in which we operate.
Class III Directors (Term Expires at 2021 Annual Meeting)
Paul Edick.Mr. Edick joined our company in January 2017 as President and Chief Executive Officer and was appointed as Chairman in June 2018. As of August 2020, Mr. Edick relinquished the President title within the company. Previously, Mr. Edick was a founding partner of 3G Advisors, a consultancy firm to the pharmaceutical, healthcare and healthcare investor communities. From 2010 to 2014, Mr. Edick was the chief executive officer of Durata Therapeutics, Inc., a biopharmaceutical company, prior to its acquisition in November 2014. Prior to that, Mr. Edick was chief executive officer of Ganic Pharmaceuticals, Inc., a Warburg Pincus investment search vehicle, from 2008 to 2010. Before that, from 2006 to 2008, Mr. Edick was chief executive officer of MedPointe Healthcare, Inc., a pharmaceutical company, and served as its president of pharmaceutical operations from 2002 to 2006.
Mr. Edick currently serves on the board of directors for Iterum Therapeutics Limited.
subsidiaries.
Name | Positions and Offices Held with Xeris | Director Since | Class and Year in Which Term Will Expire | Age | ||||||||||||||||||||||
BJ Bormann | Director | 2018 | Class I - 2022 | 62 | ||||||||||||||||||||||
John Schmid | Director (Lead Independent Director) | 2017 | Class I - 2022 | 58 | ||||||||||||||||||||||
Dawn Halkuff | Director | 2018 | Class II - 2023 | 50 | ||||||||||||||||||||||
Jeffrey Sherman | Director | 2018 | Class II - 2023 | 66 |
Name | Position Held with Xeris | Officer Since | Age | |||||||
Barry Deutsch | Chief Financial Officer | 2018 | 55 | |||||||
Beth Hecht | Senior Vice President, General Counsel and Corporate Secretary | 2018 | 55 | |||||||
Ken Johnson | Senior Vice President, Clinical Development, Regulatory, Quality Assurance and Medical Affairs | 2017 | 56 | |||||||
Steven Prestrelski | Chief Scientific Officer | 2005 | 55 | |||||||
John Shannon | Executive Vice President, Chief Operating Officer | 2017 | 57 |
April 29, 2021.
Officer | ||||||||||||||||||||
Name | Position Held with Xeris | Since | Age | |||||||||||||||||
Barry Deutsch | Chief Financial Officer | 2018 | 58 | |||||||||||||||||
Beth Hecht | Senior Vice President, General Counsel and Corporate Secretary | 2018 | 57 | |||||||||||||||||
Ken Johnson | Senior Vice President, Clinical Development, Regulatory, Quality Assurance and Medical Affairs | 2017 | 58 | |||||||||||||||||
Steven Prestrelski | Chief Scientific Officer | 2005 | 57 | |||||||||||||||||
John Shannon | President and Chief Operating Officer | 2017 | 59 |
, a drug and diagnostics delivery company.
BioScience, a biopharmaceutical company.
AS XERIS’ XERIS'
FISCAL YEAR ENDING
2021
2018 | 2017 | |||||||
Audit fees (1) | $ | 200,000 | $ | 62,000 | ||||
Audit-related fees (2) | 618,000 | — | ||||||
Tax fees (3) | 20,000 | 154,000 | ||||||
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Total fees | $ | 838,000 | $ | 216,000 | ||||
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2019.
2020 | 2019 | |||||||||||||
Audit fees (1) | $ | 742,564 | $ | 647,033 | ||||||||||
Audit-related fees (2) | — | — | ||||||||||||
Tax fees (3) | 44,500 | 89,429 | ||||||||||||
All other fees | — | — | ||||||||||||
Total fees | $ | 787,064 | $ | 736,462 | ||||||||||
•Nominees should demonstrate high standards of personal and professional ethics and integrity.
•Nominees should have proven achievement and competence in the nominee’s field and the ability to exercise sound business judgment.
•Nominees should have skills that are complementary to those of the existing board.
•Nominees should have the ability to assist and support management and make significant contributions to our success.
•Nominees should have an understanding of the fiduciary responsibilities that are required of a member of the board and the commitment of time and energy necessary to diligently carry out those responsibilities.
in carrying out the responsibilities of a director. In order to be considered independent for purposes ofRule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee, accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries or otherwise be an affiliated person of the listed company or any of its subsidiaries. In addition, in affirmatively determining the independence of any director who will serve on a company’s compensation committee,Rule 10C-1 under the Exchange Act requires that a company’s board of directors must consider all factors specifically relevant to determining whether a director has a relationship to such company which is material to that director’s ability to be independent from management in connection with the duties of a compensation committee member, including: the source of compensation to the director, including any consulting, advisory or other compensatory fee paid by such company to the director, and whether the director is affiliated with the company or any of its subsidiaries or affiliates.
www.xerispharma.com/investors/corporate-governance.
•appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm;
•pre-approving auditing and permissiblenon-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;
•reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements;
•reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us;
•coordinating the oversight and reviewing the adequacy of our internal control over financial reporting;
•establishing policies and procedures for the receipt and retention ofaccounting-related complaints and concerns;
•recommending based upon the audit committee’s review and discussions with management and our independent registered public accounting firm whether our audited financial statements shall be included in our Annual Report onForm 10-K;
•monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters;
•preparing the audit committee report required by SEC rules to be included in our annual proxy statement;
•reviewing all related person transactions for potential conflict of interest situations and approving all such transactions; and
•reviewing quarterly earnings releases.
•annually reviewing and recommending to the board of directors the corporate goals and objectives relevant to the compensation of our Chief Executive Officer;
•reviewing and approving the cash compensation of our other executive officers;
•reviewing and establishing our overall management compensation, philosophy, and policy;
•overseeing and administering our compensation and similar plans;
•evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified in the applicable Nasdaq rules;
•reviewing and approving our policies and procedures for the grant of equity-based awards;
reviewing and recommending to the board of directors the compensation of our directors;
•preparing our compensation committee report if and when required by SEC rules;
•reviewing and discussing annually with management our “Compensation Discussion and Analysis,” if and when required, to be included in our annual proxy statement; and
•reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation matters.
Nominating and Corporate Governance Committee
Jonathan Rigby,
•developing and recommending to the board of directors criteria for board and committee membership;
•establishing procedures for identifying and evaluating board of director candidates, including nominees recommended by stockholders;
•reviewing the composition of the board of directors to ensure that it is composed of members containing the appropriate skills and expertise to advise us;
•identifying individuals qualified to become members of the board of directors;
•recommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees;
•developing and recommending to the board of directors a code of business conduct and ethics and a set of corporate governance guidelines; and
•overseeing the evaluation of our board of directors and management.
and taking into account the overall composition and needs of our board of directors. Based on the results of the evaluation process, the nominating and corporate governance committee recommends candidates for the board of directors’ approval to fill a vacancy or as director nominees for election to the board of directors by our stockholders each year in the class of directors whose term expires at the relevant annual meeting.
2020.
Board and Committee Evaluations
- 2020
Name | Fees Earned or Paid in Cash ($) | Option Awards ($) (1) | Total ($) | |||||||||
BJ Bormann (2) | 38,250 | 134,013 | 172,263 | |||||||||
Robert C. Faulkner (3) | — | — | — | |||||||||
Dawn Halkuff (4) | 33,750 | 134,013 | 167,763 | |||||||||
Cary McNair (3) | — | — | — | |||||||||
Marla Persky (5) | 35,250 | 134,013 | 169,263 | |||||||||
Jonathan Rigby (6) | 48,250 | 76,575 | 124,825 | |||||||||
John Schmid (7) | 52,750 | 172,000 | 224,750 | |||||||||
Jeffrey Sherman (8) | 30,750 | 134,013 | 164,763 |
Name | Fees Earned or Paid in Cash ($) (1) | Option Awards ($) (2) | Total ($) | |||||||||||||||||
BJ Bormann (3) | 55,000 | 33,234 | 88,234 | |||||||||||||||||
Dawn Halkuff (4) | 45,000 | 33,234 | 78,234 | |||||||||||||||||
Marla Persky (5) | 51,000 | 33,234 | 84,234 | |||||||||||||||||
John Schmid (6) | 77,000 | 33,234 | 110,234 | |||||||||||||||||
Jeffrey Sherman (7) | 45,000 | 33,234 | 78,234 | |||||||||||||||||
Mark Thierer (8) | 32,250 | 33,234 | 65,484 | |||||||||||||||||
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Name | ($) | ||||||||||
Dr. Bormann | 20,625 |
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Ms. Halkuff | 33,750 |
Ms. Persky | 9,562 |
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| 28,875 | ||||||||||
Dr. Sherman | 16,875 | ||||||||||
Mr. | 32,250 |
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(2) The amounts reported in the Option Awards column represent the grant date fair value of the stock options granted to our non-employee directors as of the grant date as computed in accordance with Accounting Standards Codification Topic 718 issued by the Financial Accounting Standards Board, not including any estimates of forfeitures. The assumptions used in calculating the grant date fair value of the stock options reported in the Option Awards column are set forth in the notes to our audited financial statements included in our Annual Report on Form 10-K. Note that the amounts reported in this column reflect the accounting cost for these stock options and do not correspond to the actual economic value that may be received by our non-employee directors from the options.
MEMBER ANNUAL FEE ($) | CHAIRMAN ADDITIONAL ANNUAL FEE ($) | |||||||
Board of Directors | 35,000 | 20,000 | ||||||
Audit Committee | 8,000 | 8,000 | ||||||
Compensation Committee | 6,000 | 6,000 | ||||||
Nominating and Corporate Governance Committee | 4,000 | 4,000 |
MEMBER ANNUAL FEE ($) | CHAIRMAN ADDITIONAL ANNUAL FEE ($) | |||||||||||||
Board of Directors | 35,000 | 20,000 | ||||||||||||
Audit Committee | 8,000 | 8,000 | ||||||||||||
Compensation Committee | 6,000 | 6,000 | ||||||||||||
Nominating and Corporate Governance Committee | 4,000 | 4,000 |
•John Shannon, our Executive Vice President and Chief Operating Officer; and
Barry Deutsch,•Beth Hecht, our Chief Financial Officer.
Summary Compensation Table
NAME AND PRINCIPAL | YEAR | SALARY ($) | BONUS ($) (1) | OPTION AWARDS ($) (2) | NON-EQUITY INCENTIVE PLAN COMPENSATION ($) (3) | ALL OTHER COMPENSATION ($) | TOTAL ($) | |||||||||||||||||||||
Paul Edick, | 2018 | 535,000 | 119,900 | 329,626 | 329,725 | — | 1,314,251 | |||||||||||||||||||||
President and Chief Executive Officer (4) | 2017 | 489,583 | — | 657,134 | 250,000 | — | 1,396,717 | |||||||||||||||||||||
John Shannon, | 2018 | 368,750 | — | 344,036 | 205,700 | — | 918,486 | |||||||||||||||||||||
Executive Vice President and Chief Operating Officer (5) | 2017 | 218,750 | — | 168,029 | 100,834 | — | 487,613 | |||||||||||||||||||||
Barry Deutsch, Chief Financial Officer (6) | 2018 | 276,095 | — | 448,144 | 132,000 | — | 856,239 |
NAME AND PRINCIPAL POSITION | YEAR | SALARY ($)(1) | STOCK AWARDS ($) (2) | OPTION AWARDS ($) (3) | NON-EQUITY INCENTIVE PLAN COMPENSATION ($) (4) | ALL OTHER COMPENSATION ($) (5) | TOTAL ($) | |||||||||||||||||||||||||||||||||||||
Paul Edick, | 2020 | 626,977 | 1,178,450 | — | 453,222 | 5,700 | 2,264,349 | |||||||||||||||||||||||||||||||||||||
Chief Executive Officer | 2019 | 598,277 | 1,735,000 | 1,598,580 | 370,181 | 5,600 | 4,307,638 | |||||||||||||||||||||||||||||||||||||
John Shannon, | 2020 | 473,658 | 414,050 | 246,300 | 300,000 | 2,420 | 1,436,428 | |||||||||||||||||||||||||||||||||||||
President and Chief Operating Officer | 2019 | 444,479 | — | 639,432 | 178,500 | 5,171 | 1,267,582 | |||||||||||||||||||||||||||||||||||||
Beth Hecht, | 2020 | 392,852 | 286,650 | 369,450 | 189,808 | 5,634 | 1,244,394 | |||||||||||||||||||||||||||||||||||||
Senior Vice President, General Counsel and Corporate Secretary | 2019 | 364,417 | — | 259,769 | 145,782 | 5,600 | 775,568 | |||||||||||||||||||||||||||||||||||||
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Name | ($) | ||||||||||
Mr. Edick | 397,106 | ||||||||||
Mr. Shannon | 179,932 | ||||||||||
Ms. Hecht | 59,315 |
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Name | ($) | ||||||||||
Mr. Edick | 339,916 | ||||||||||
Mr. Shannon | 112,500 | ||||||||||
Ms. Hecht | 28,471 |
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Mr. Edick’s employment agreement provides that, in the event that his employment is terminated by us without “cause” or by him upon a “material change,” subject to the execution and effectiveness of a separation agreement and release, he will be entitled to receive (in addition to accrued compensation and benefits through the date of termination) (i) salary continuation based on his then-current base salary for 11 months and (ii) reimbursement of COBRA premiums for health benefit coverage for him and his immediate family in an amount equal to the monthly employer contribution that we would have made to provide health insurance to Mr. Edick had he remained employed with us for up to 11 months following termination.
Upon a “change in control,” subject to the execution and effectiveness of a release, Mr. Edick shall be eligible to receive a lump sum amount equal to 18 months of his then-current base salary (but in no event less than $500,000), his annual target bonus reflective for a period of 18 months and 100% accelerated vesting of his outstanding stock options. Furthermore, the employment agreement provides that our board of directors may, in its sole discretion, consider providing Mr. Edick with a transaction bonus at the time of a “change in control.” If he is terminated upon the effectiveness of the “change in control,” he shall also receive reimbursement of
COBRA premiums for health benefit coverage for him and his immediate family in an amount equal to the monthly employer contribution that we would have made to provide health insurance to Mr. Edick had he remained employed with us for up to 18 months following termination.
We have entered into anwas amended and restated employment agreement with Mr. Edickin 2018, pursuant to which Mr. Edick is entitled to receive an annual base salary and an annual target bonus equal to a percentage of his annual base salary based upon our board of directors’ assessment of Mr. Edick’s performance and our attainment of targeted goals as set by the board of directors in its sole discretion. For the fiscal year ending December 31, 2019,2020, Mr. Edick’s annual base salary, is $599,500effective as of February 1, 2020, was $629,475 and his annual target bonus iswas 60% of his annual base salary. This employment agreement also contains provisions related to confidentiality, inventions assignment and non-competition, pursuant to which Mr. Edick re-affirmedreaffirmed the obligations contained in his Proprietary Information and Inventions Agreement. Mr. Edick’s amended and restated employment agreement provides that, in the event that his employment is terminated by us without “cause” or by himhe resigns for “good reason,” subject to the execution and effectiveness of a separation agreement and release, he will be entitled to receive (i) an amount equal to (x) 18 months of base salary payable on our normal payroll cycle if such termination is not in connection withwithin 12 months of a “change in control” or (y) 18 months1.5 times the sum of his base salary plus histhe average targetof his incentive compensation received for the three preceding fiscal years if such termination is in connection withwithin 12 months of a “change in control,” and (ii) reimbursement of COBRA premiums for health benefit coverage for him in an amount equal to the monthly employer contribution that we would have made to provide health insurance to Mr. Edick had he remained employed with us for up to 18 months. In addition, if within 12 months following a “change in control,” Mr. Edick is terminated by us without “cause” or he resigns for “good reason,” all time-based stock options and other time-based stock-based awards held by Mr. Edick issued after the date of the amended and restated employment agreement will accelerate and vest immediately.
Upon a “change in control,” subject to the execution and effectiveness of a release, Mr. Shannon shall be eligible to receive a lump sum amount equal to 12 months of his then-current base salary (but in no event less than $250,000), his annual target bonus and 100% accelerated vesting of his outstanding stock options. Furthermore, the employment agreement provides that our board of directors may, in its sole discretion, consider providing Mr. Shannon with a transaction bonus at the time of a “change in control.” If he is terminated upon the effectiveness of the “change in control,” he shall also receive reimbursement of COBRA premiums for health benefit coverage for him and his immediate family in an amount equal to the monthly employer contribution that we would have made to provide health insurance to Mr. Shannon had he remained employed with us for up to 12 months following termination.
We have entered into anwas amended and restated employment agreement with Mr. Shannonin 2018, and subsequently amended on August 18, 2020, pursuant to which Mr. Shannon is entitled to receive an annual base salary and an annual target bonus equal to a percentage of his annual base salary based upon our board of directors’ assessment of Mr. Shannon’s performance and our attainment of targeted goals as set by the board of directors in its sole discretion. For the fiscal year ending December 31, 2019,2020, Mr. Shannon’s annual base salary, is $446,250effective as of February 1, 2020, was $459,637 and his annual target bonus iswas 40% of his annual base salary. ThisEffective August 20, 2020, Mr. Shannon was promoted to President and Chief Operating Officer at which time his annual base salary was increased to $500,000 and his annual target bonus was increased to 50% of his annual base salary. Mr. Shannon's employment agreement also contains provisions related to confidentiality, inventions assignment and non-competition, pursuant to which Mr. Shannon re-affirmedreaffirmed the obligations contained in his Proprietary Information and Inventions Agreement. Mr. Shannon’s amended and restated employment agreement provides that, in the event that his employment is terminated by us without “cause” or by himhe resigns for “good reason,” subject to the execution and effectiveness of a separation agreement and release, he will be entitled to receive (i) an amount equal to (x) 15 months of base salary payable on our normal payroll cycle if such termination is not in connection withwithin 12 months of a “change in control” or (y) 15 months1.25
Barry Deutsch
OPTION AWARDS (1) | STOCK AWARDS | |||||||||||||||||||||||||||
NAME | VESTING COMMENCEMENT DATE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) EXERCISABLE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) UNEXERCISABLE | OPTION EXERCISE PRICE ($) | OPTION EXPIRATION DATE | NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#) | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($) | |||||||||||||||||||||
Paul Edick | 2/1/2018 | (2) | 98,252 | — | 5.93 | 1/31/2028 | — | — | ||||||||||||||||||||
6/12/2017 | (2) | 69,822 | — | 1.55 | 6/11/2027 | — | — | |||||||||||||||||||||
1/9/2017 | (2) | 668,065 | — | 1.55 | 1/27/2027 | — | — | |||||||||||||||||||||
John Shannon | 5/15/2018 | (2) | 34,977 | — | 12.50 | 5/15/2028 | — | — | ||||||||||||||||||||
1/31/2018 | (2) | 28,072 | — | 5.93 | 1/31/2028 | — | — | |||||||||||||||||||||
6/12/2017 | (3) | — | 25,136 | 1.55 | 6/11/2027 | — | — | |||||||||||||||||||||
2/16/2017 | (3) | 129,067 | 31,268 | 1.55 | 2/3/2027 | — | — | |||||||||||||||||||||
Barry Deutsch | 5/15/2018 | (2) | 56,144 | — | 12.50 | 5/15/2028 | — | — | ||||||||||||||||||||
2/1/2018 | (2) | 14,036 | — | 5.93 | 1/31/2028 | — | — | |||||||||||||||||||||
7/17/2017 | (2) | 21,054 | — | 2.33 | 10/20/2027 | — | — |
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2020.
OPTION AWARDS | STOCK AWARDS | |||||||||||||||||||||||||||||||||||||||||||
NAME | VESTING COMMENCEMENT DATE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) EXERCISABLE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) UNEXERCISABLE | OPTION EXERCISE PRICE ($) | OPTION EXPIRATION DATE | NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#) | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($) (1) | |||||||||||||||||||||||||||||||||||||
Paul Edick | 1/31/2020 (2) | — | — | — | — | 185,000 | $ | 910,200 | ||||||||||||||||||||||||||||||||||||
1/31/2019 (3) | — | — | — | — | 93,750 | $ | 461,250 | |||||||||||||||||||||||||||||||||||||
1/31/2019 (3) | 95,833 | 104,167 | 13.88 | 1/31/2029 | — | — | ||||||||||||||||||||||||||||||||||||||
1/31/2018 (4)(5) | 98,252 | — | 5.93 | 1/31/2028 | — | — | ||||||||||||||||||||||||||||||||||||||
6/12/2017 (4)(5) | 69,822 | — | 1.55 | 6/11/2027 | — | — | ||||||||||||||||||||||||||||||||||||||
1/09/2017 (4)(5) | 668,065 | — | 1.55 | 1/27/2027 | — | — | ||||||||||||||||||||||||||||||||||||||
John Shannon | 8/18/2020 (2) | — | 100,000 | 3.94 | 8/18/2030 | — | — | |||||||||||||||||||||||||||||||||||||
1/31/2020 (2) | — | — | — | — | 65,000 | 319,800 | ||||||||||||||||||||||||||||||||||||||
1/31/2019 (3) | 38,333 | 41,667 | 13.88 | 1/31/2029 | — | — | ||||||||||||||||||||||||||||||||||||||
5/15/2018 (4)(5) | 34,977 | — | 12.50 | 5/15/2028 | — | — | ||||||||||||||||||||||||||||||||||||||
1/31/2018 (4)(5) | 28,072 | — | 5.93 | 1/31/2028 | — | — | ||||||||||||||||||||||||||||||||||||||
6/12/2017 (4)(5) | 25,136 | — | 1.55 | 6/12/2027 | — | — | ||||||||||||||||||||||||||||||||||||||
2/16/2017 (4)(5) | 160,335 | — | 1.55 | 2/4/2027 | — | — | ||||||||||||||||||||||||||||||||||||||
Beth Hecht | 8/14/2020 (2) | — | 150,000 | 3.94 | 8/14/2030 | — | — | |||||||||||||||||||||||||||||||||||||
1/31/2020 (2) | — | — | — | — | 45,000 | 221,400 | ||||||||||||||||||||||||||||||||||||||
1/31/2019 (3) | 15,572 | 16,928 | 13.88 | 1/31/2029 | — | — | ||||||||||||||||||||||||||||||||||||||
10/5/2018 (3) | 2,073 | 1,753 | 19.00 | 10/5/2028 | — | — | ||||||||||||||||||||||||||||||||||||||
5/15/2018 (4)(5) | 65,295 | — | 12.50 | 5/15/2028 | — | — | ||||||||||||||||||||||||||||||||||||||
1/31/2018 (4)(5) | 30,879 | — | 5.93 | 1/31/2028 | — | — |
Securities Authorized for Issuance under Equity Compensation Plans
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 the First Column) | |||||||||
Equity compensation plans approved by stockholders(1) | 3,233,347 | $ | 8.13 | 1,313,937 | (2) | |||||||
Equity compensation plans not approved by stockholders(3) | — | — | — | |||||||||
Total | 3,233,347 | $ | 8.13 | 1,313,937 | (4) |
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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 the First Column) | |||||||||||||||||
Equity compensation plans approved by stockholders (1)(2) | 4,712,000 | $ | 5.78 | 917,423 | ||||||||||||||||
Equity compensation plans not approved by stockholders (3) | 241,906 | $ | 6.81 | 263,794 | ||||||||||||||||
Total | 4,953,906 | $ | 5.84 | 1,181,217 |
reserved and available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2019,2020, by the lesser of 386,000 shares of our common stock, 1% of the outstanding number of shares of our common stock on the immediately preceding December 31 or such lesser number of shares as determined by the compensation committee. This number will be subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization.
As of December 31, 2020, a total of 263,764 shares of our common stock have been reserved for future issuance of awards under the Inducement Plan.
This is primarily due to the fact that our compensation programs are designed to encourage our executive officers and other employees to remain focused on both short-term and long-term strategic goals. As a result, we do not believe that our compensation programs are reasonably likely to have a material adverse effect on us.
Name | Shares of Common Stock Purchased | Aggregate Cash Purchase Price | ||||||
Entities affiliated with Palmetto Partners, Ltd. | 150,000 | $ | 2,250,000.00 | |||||
Entities affiliated with Deerfield Management Company | 750,000 | $ | 11,250,000.00 | |||||
Entities affiliated with Redmile Group, LLC | 666,667 | $ | 10,000,005.00 |
Participation in our Public Offering
Our directors, officers and 5% stockholders and their affiliates purchased an aggregate of 596,5008,500 shares of our common stock in our 2019 public equity offering at the public offering price. The following table sets forth the number of shares of our common stock purchased by directors, executive officers and 5% stockholders and their affiliates and the aggregate purchase price paid for such shares.
Name | Shares of Common Stock Purchased | Aggregate Cash Purchase Price | ||||||
Entities affiliated with Redmile Group, LLC | 588,000 | $ | 5,880,000.00 | |||||
Barry Deutsch | 5,000 | $ | 50,000.00 | |||||
Beth Hecht | 2,500 | $ | 25,000.00 | |||||
Kenneth Johnson | 1,000 | $ | 10,000.00 |
Private Placements of Securities
Series C Preferred Stock Financing
In December 2015, with subsequent closings
Name | Shares of Common Stock Purchased | Aggregate Cash Purchase Price | ||||||||||||
Barry Deutsch | 5,000 | $ | 50,000.00 | |||||||||||
Beth Hecht | 2,500 | $ | 25,000.00 | |||||||||||
Kenneth Johnson | 1,000 | $ | 10,000.00 |
STOCKHOLDER | SHARES OF SERIES C PREFERRED STOCK | TOTAL PURCHASE PRICE | ||||||
Entities affiliated with Palmetto Partners, Ltd. | 1,833,983 | $ | 11,499,996.38 | |||||
Entities affiliated with Deerfield Management Company | 3,114,584 | $ | 19,529,998.98 | |||||
Entities affiliated with Redmile Group, LLC (1) | 3,109,796 | $ | 19,499,995.65 | |||||
Paul Edick (2) | 23,922 | $ | 150,002.91 | |||||
Nora Brennan (3) | 16,000 | $ | 100,328.00 | |||||
John Shannon | 16,000 | $ | 100,328.00 | |||||
Ken Johnson | 4,000 | $ | 25,082.00 | |||||
Barry Deutsch | 3,987 | $ | 25,000.49 |
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directors, executive officers and 5% stockholders and their affiliates and the aggregate purchase price paid for such shares.
Name | Shares of Common Stock Purchased | Aggregate Cash Purchase Price | ||||||||||||
Entities affiliated with Sessa Capital (Master), L.P. | 1,100,000 | $ | 4,565,000.00 | |||||||||||
Entities affiliated with Deerfield Management Company, L.P. | 850,000 | $ | 3,527,500.00 | |||||||||||
Paul R. Edick | 20,000 | $ | 83,000.00 | |||||||||||
John Shannon | 12,048 | $ | 49,999.20 | |||||||||||
Barry Deutsch | 9,639 | $ | 40,001.85 | |||||||||||
Beth Hecht | 4,000 | $ | 16,600.00 | |||||||||||
Kenneth Johnson | 2,410 | $ | 10,001.50 |
Name | Convertible Notes Purchased | Shares of Common Stock Purchased | Aggregate Cash Purchase Price | |||||||||||||||||
Entities affiliated with Deerfield Management Company, L.P. | 18,000 | — | $ | 18,000,000 | ||||||||||||||||
Entities affiliated with Sessa Capital (Master), L.P. | — | 740,000 | $ | 2,012,800 |
Indemnification Agreements
In connection with our IPO, we entered into agreements to indemnify our directors and executive officers. These agreements, among other things, require us to indemnify these individuals for certain expenses (including attorneys’ fees), judgments, fines and settlement amounts reasonably incurred by such person in any action or proceeding, including any action by or in our right, on account of any services undertaken by such person on behalf of the Company or that person’s status as an executive officer or a member of our board of directors to the maximum extent allowed under Delaware law.
•any breach of the director’s duty of loyalty to us or our stockholders;
•any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;
•any unlawful payments related to dividends or unlawful stock purchases, redemptions or other distributions; or
•any transaction from which the director derived an improper personal benefit.
Person Transaction Policy
members and affiliates.
•the related person’s interest in the related person transaction;
•the approximate dollar amount involved in the related person transaction;
•the approximate dollar amount of the related person’s interest in the transaction without regard to the amount of any profit or loss;
•whether the transaction was undertaken in the ordinary course of our business;
•whether the terms of the transaction are no less favorable to us than terms that could have been reached with an unrelated third party;
•the purpose of, and the potential benefits to us of, therelated-party transaction; and
•any other information regarding therelated-party transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction.
•each of our directors;
•each of our named executive officers;
•all of our directors and executive officers as a group;group; and
•each person, or group of affiliated persons, who is known by us to be a beneficial owner of greater-than-5.0%greater than 5.0% of our common stock.
April 19, 2021.
SHARES BENEFICIALLY OWNED | ||||||||
NUMBER | PERCENTAGE | |||||||
5% Stockholders | ||||||||
Entities affiliated with Redmile Group, LLC (1) | 3,000,642 | 11.19 | % | |||||
Entities affiliated with Deerfield Management Company (2) | 2,355,136 | 8.78 | % | |||||
Entities affiliated with FMR LLC (3) | 2,280,968 | 8.51 | % | |||||
Entities affiliated with Palmetto Partners, Ltd. (4) | 1,971,289 | 7.35 | % | |||||
Directors, Named Executive Officers and Other Executive Officers | ||||||||
Paul Edick (5) | 849,569 | 3.07 | % | |||||
Steven Prestrelski (6) | 551,626 | 2.05 | % | |||||
John Shannon (7) | 257,503 | * | ||||||
Barry Deutsch (8) | 119,526 | * | ||||||
Beth Hecht (9) | 98,674 | |||||||
Ken Johnson (10) | 81,844 | * | ||||||
Jonathan Rigby (11) | 39,344 | * | ||||||
John Schmid (12) | 30,879 | * | ||||||
BJ Bormann (13) | 19,650 | * | ||||||
Jeffrey Sherman (14) | 19,650 | * | ||||||
Marla Persky (15) | 19,650 | * | ||||||
Dawn Halkuff (16) | 19,650 | * | ||||||
All current executive officers and directors as a group (12 persons) (17) | 2,107,565 | 7.43 | % |
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SHARES BENEFICIALLY OWNED | ||||||||||||||
NUMBER | PERCENTAGE | |||||||||||||
5% Stockholders | ||||||||||||||
Entities affiliated with Deerfield Management Company, L.P. (1) | 12,435,751 | 9.97 | % | |||||||||||
Entities affiliated with Sessa Capital (Master), L.P. (2) | 6,607,100 | 9.61 | % | |||||||||||
Blackrock, Inc. (3) | 3,647,218 | 5.50 | % | |||||||||||
Directors, Named Executive Officers and Other Executive Officers | ||||||||||||||
Paul Edick (4) | 1,191,536 | 1.77 | % | |||||||||||
John Shannon (5) | 373,077 | * | ||||||||||||
Beth Hecht (6) | 149,784 | * | ||||||||||||
John Schmid (7) | 62,107 | * | ||||||||||||
BJ Bormann (8) | 50,878 | * | ||||||||||||
Jeffrey Sherman (9) | 50,878 | * | ||||||||||||
Marla Persky (10) | 50,878 | * | ||||||||||||
Dawn Halkuff (11) | 50,878 | * | ||||||||||||
All current executive officers and directors as a group (11 persons) (12) | 2,736,981 | 4.01 | % |
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REPORTS
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March 26, 2019