UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Important Notice Regarding the Availability of Proxy Materials for the Stockholders' Meeting to Be Held on May, 30 2018 at 9:00 a.m. at the Holiday Inn Express located at 20280 Goldenrod Lane, Germantown, MD 20878.
The proxy statement and annual report to stockholdersare available at [ ].
| | Important Notice Regarding the Availability of Proxy Materials for the Stockholders’ Meeting to Be Held on May 22, 2024 at 10:00 a.m. EDT at http://www.meetnow.global/MZZTTZF. The proxy statement and annual report to stockholders are available at www.envisonreports.com/sens. | | |
| | You are cordially invited to attend the meeting online. Whether or not you expect to attend the meeting, please vote by one of following methods as promptly as possible in order to ensure your representation at the meeting: 1) over the internet at www.envisionreports.com/sens, 2) by telephone by calling the toll-free number 1-800-652-VOTE, or 3) by completing, dating, signing and returning the proxy mailed to you. Even if you have voted by proxy, you may still vote online if you attend the meeting. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote online at the meeting, you must obtain a proxy issued in your name from that record holder. | | |
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Germantown, Maryland
Proposals | | | Page | | | Voting Standard | | | Board Recommendation | |
Election of Directors | | | | | Plurality | | | FOR each director nominee | | |
Advisory approval of the compensation of the Company’s named executive officers | | | | | Majority of shares present in person or virtually or represented by proxy and entitled to vote on the matter. | | | FOR | | |
Ratification of the selection of KPMG LLP as the Company’s independent registered public accounting firm for fiscal year ending December 31, 2024 | | | | | Majority of shares present in person or virtually or represented by proxy and entitled to vote on the matter. | | | FOR | | |
Amend Company’s Certificate of Incorporation to increase authorized shares of common stock from 900,000,000 to 1,400,000,000 | | | | | Majority of votes cast | | | FOR | |
We
Notice.
annual meeting.
What am I voting on?
Beneficial Owner: Shares Registered in the Name of Broker or Bank
your broker, bank or other agent. Followplease follow the instructions from your brokerfound at http://www.meetnow.global/MZZTTZF. Whether or bank included withnot you plan to attend the proxy materials, or contact your broker or bank to request a proxy form.
Internet proxy voting may be provided to allowmeeting, we urge you to vote your shares online, with procedures designedby proxy to ensure your vote is counted. You may still attend the authenticityAnnual Meeting and correctness of your proxy vote instructions. However, please be aware thatonline even if you must bear any costs associated with your internet access, such as usage charges from internet access providers and telephone companies.
March 26, 2024.
Stockholder of Record: Shares Registered in Your Name
What if I return a proxy cardbroker, bank or otherwise vote but do not make specific choices?
If you return a signed and dated proxy card or otherwise vote without marking voting selections, your shares will be voted, as applicable, "For" the election of all three nominees for director, "For" the ratification of Ernst & Young LLP as independent auditors for the year ending December 31, 2018 and "For" the amendment to the Company's Amended and Restated Certificate of Incorporation to increase the authorized number of shares of common stock from 250,000,000 shares to 450,000,000 shares. If any other matter is properly presented at the meeting, your proxyholder (one of the individuals named on your proxy card) will vote your shares using his or her best judgment.
agent.
proxies. We will also reimburse brokerage firms, banks and other agents for the cost of forwarding proxy materials to beneficial owners.
bank or vote online at the Annual Meeting.
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"“Exchange Act”), and the rules and regulations promulgated under the Exchange Act, including the person'sperson’s written
How are votes counted?
Votes will be counted by the inspector of election appointed for the meeting, who will separately count, for the proposal to elect directors, votes "For," "Withhold" and broker non-votes and, with respect to the other proposals, votes "For," "Against," abstentions and, if applicable, broker non-votes. Abstentions and broker non-votes, if applicable, for Proposal 2 will have no effect. Abstentions and broker non-votes, if any, for Proposal 3 will have the same effect as "Against" votes.
For
Proposal Number | | | Proposal Description | | | Vote Required for Approval | | | Voting Options | | | Effect of Abstentions or Withhold votes, as applicable | | | Effect of Broker Non-Votes | |
1 | | | Election of Directors | | | Three nominees receiving the most “For” votes; withheld votes will have no effect | | | FOR or WITHHOLD | | | No effect | | | No effect | |
2 | | | Advisory approval of the compensation of our named executive officers | | | “For” votes from the holders of a majority of shares present at the Annual Meeting or represented by proxy and entitled to vote on the matter | | | FOR, AGAINST or ABSTAIN | | | Against | | | No effect | |
Proposal Number | | | Proposal Description | | | Vote Required for Approval | | | Voting Options | | | Effect of Abstentions or Withhold votes, as applicable | | | Effect of Broker Non-Votes | |
3 | | | Ratification of selection of KPMG LLP as independent registered public accounting firm for the year ending December 31, 2024 | | | “For” votes from the holders of a majority of shares present at the Annual Meeting or represented by proxy and entitled to vote on the matter | | | FOR, AGAINST or ABSTAIN | | | Against | | | Not applicable(1) | |
4 | | | Amend Company’s Certificate of Incorporation to increase authorized shares of common stock from 900,000,000 to 1,400,000,000 | | | Votes cast “FOR” the proposal at the Annual Meeting must exceed votes cast “AGAINST” the proposal for this proposal to be approved | | | FOR, AGAINST or ABSTAIN | | | No effect | | | Not applicable(1) | |
To be approved, Proposal No. 2, ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2018, must receive "For" votes from the holders of a majority of shares present in person or represented by proxy and entitled to vote on the matter. If you mark your proxy to "Abstain" from voting, it will have the same effect as an "Against" vote. Broker non-votes, if any, will have no effect.
To be approved, Proposal No. 3, amendment to the Company's Amended and Restated Certificate of Incorporation to increase the authorized number of shares of common stock from 250,000,000 shares to 450,000,000 shares, must receive "For" votes from the holders, either in person or by proxy, of a majority of the outstanding shares entitled to vote on the matter. If you mark your proxy to "Abstain" from voting, it will have the same effect as an "Against" vote. Broker non-votes, if any, will have the same effect as an "Against" vote.
this proposal.
Annual Meeting in person or represented by proxy. On the record date, there were [ ]530,817,549 shares outstanding and entitled to vote. Thus, the holders of [ ]265,408,775 shares must be present in person or represented by proxy at the Annual Meeting to have a quorum.
What proxy materials8-K that we expect to file within four business days after the Annual Meeting. If final voting results are not available onto us in time to file a Form 8-K within four business days after the internet?
The proxy statementAnnual Meeting, we intend to file a Form 8 K to publish preliminary results and, annual reportwithin four business days after the final results are known to stockholders are available at [ ].
believes that Dr. Edelman'sEdelman’s substantial diabetes industry experience qualifies him to serve as a director of our Company.
Dr. Klein
as the Chief Financial Officer of Crane & Co., Inc., a global technology company, from February 2013 to January 2018. Prior to Crane & Co., from OctoberFrom 2010 to January 2013, Mr. Prince served as the Chief Financial Officer of Northern Power Systems Corp., an energy technology company. From 2007 to 2010, Mr. Prince served as Chief Financial Officer of Nordion Inc. (formerly MDS Inc.), a public life sciences company. Since November 2019, Mr. Prince has also served on the Board of Directors of Creation Technologies, a private electronics manufacturing services company. Mr. Prince received his B.B.A. in Business Administration from the University of Kentucky. Our Board of Directors believes that Mr. Prince'sPrince’s executive experience and financial expertise qualify him to serve as a director of our Company.
Dr. Barrett was elected toThe Board Diversity Matrix, below, provides the diversity statistics for our Board of Directors in December 2015. Dr. Barrett founded Senseonics, Incorporated and served as a member of the board of directors of Senseonics, Incorporated from November 1996 to December 2015. He served as the Chief Executive Officer of Senseonics, Incorporated from 1997 to 2001. He currently serves as a General Partner of NEA, where he specializes in biotechnology and works with members of NEA's healthcare investment group on medical devices, healthcare information systems and healthcare services companies. Prior to joining NEA and Senseonics, Incorporated, he led three NEA-funded companies, serving from 1987 to 1995 as Chairman and Chief Executive Officer at Genetic Therapy, Inc. and from 1982 to 1987 as President and Chief Executive Officer at Life Technologies, Inc. and its predecessor, Bethesda Research Laboratories, Inc. Previously, Dr. Barrett worked at SmithKline Beecham Corporation, where he held a variety of positions, including President of its In Vitro Diagnostic Division and President of SmithKline Clinical Laboratories. He currently serves on the boards of directors of the publicly-held life sciences companies GlycoMimetics, Inc., Clovis Oncology, Inc., and Proteostasis Therapeutics, Inc. In the past five years, he has served on the boards of directors of the publicly traded companies Roka Bioscience, Inc., Amicus Therapeutics, Inc., Inhibitex, Inc. (acquired by Bristol-Myers Squibb Co.), Loxo Oncology, Inc., Targacept, Inc., YM Biosciences, Inc. and Zosano Pharma Corporation. Dr. Barrett received his Ph.D. in biochemistry from the University of Tennessee, his M.B.A. from the University of Santa Clara and his B.S. from Boston College. Our Board of Directors believes that Dr. Barrett's experience overseeing NEA's investments in biotechnology, serving as a member of the board of directors of other public companies, prior senior management experience, including as President and Chief Executive Officer of biopharmaceutical companies, and his strong capital markets experience qualify him to serve as a director of our Company.
Timothy T. Goodnow, Ph.D.Directors., age 56
Dr. Goodnow was elected as one of our directors and was appointed as our President and Chief Executive Officer in December 2015. From December 2010 to December 2015, Dr. Goodnow served on the board of directors of Senseonics, Incorporated and he served as the President and Chief Executive
Board Diversity Matrix (As of April 1, 2024) | | ||||||||||||||||||
Total Number of Directors | | | | | | | | | 11 | | | | | | | | |||
| | | Female | | | Male | | | Non-Binary | | |||||||||
Part I: Gender Identity | | | | | | | | | | | | | | | | | | | |
Directors | | | | | 2 | | | | | | 9 | | | | | | — | | |
Part II: Demographic Background | | | | | | | | | | | | | | | | | | | |
African American or Black | | | | | 1 | | | | | | — | | | | | | — | | |
Alaskan Native or Native American | | | | | — | | | | | | — | | | | | | — | | |
Asian | | | | | — | | | | | | 1 | | | | | | — | | |
Hispanic or Latinx | | | | | — | | | | | | — | | | | | | — | | |
Native Hawaiian or Pacific Islander | | | | | — | | | | | | — | | | | | | — | | |
White | | | | | 1 | | | | | | 8 | | | | | | — | | |
Two or More Races or Ethnicities | | | | | — | | | | | | — | | | | | | — | | |
LGBTQ+ | | | | | — | | | | | | — | | | | | | — | | |
Officer of Senseonics, Incorporated from March 2011 to December 2015. Dr. Goodnow served as Vice President, Technical Operations of Abbott Diabetes Care, a healthcare company, from 2000 to February 2011. Prior to that, he held positions at TheraSense, Verax Biomedical, Inc. and Dade Behring and Baxter Healthcare. Dr. Goodnow received his Ph.D. and B.S. in chemistry from The University of Miami. Our Board of Directors believes that Dr. Goodnow's experience as our Chief Executive Officer, his background in medical device development and his knowledge of the diabetes industry qualify him to serve as a director of our Company.
Our
Brian Hansen is not an independent director by virtue of his role as President of CGM of Ascensia Diabetes Care, our exclusive distribution partner for Eversense. By virtue of his role as Chief Operating Officer of PHC Holdings Corporation (“PHC”), Mr. Sato is not an independent director.
Mr. DeFalco is
risk assessment and management is undertaken. The Audit Committee also monitors compliance with legal and regulatory requirements.requirements and reviews cybersecurity risks. Our Nominating and Corporate Governance Committee monitors the effectiveness of our corporate governance principles, including whether they are successful in preventing illegal or improper liability-creating conduct. Our Compensation Committee assesses and monitors whether any of our compensation policies and programs has the potential to encourage excessive risk-taking. It is the responsibility of the committee chairs to report findings regarding material risk exposures to the Board of Directors as quickly as possible. The Board of Directors has delegated to the Chairman of the Board of Directors the responsibility of coordinating between the Board of Directors and management with regard to the determination and implementation of responses to any problematic risk management issues.
Name | | | Audit Committee | | | Compensation Committee | | | Nominating & Corporate Governance Committee | | |||||||||
Stephen P. DeFalco | | | | | X | | | | | | | | | | | | X* | | |
Steven V. Edelman | | | | | | | | | | | X | | | | | | X | | |
Edward J. Fiorentino | | | | | X | | | | | | X | | | | | | | | |
Douglas S. Prince | | | | | X* | | | | | | | | | | | | X | | |
Douglas A. Roeder | | | | | | | | | | | X* | | | | | | X | | |
Sharon Larkin | | | | | | | | | | | X | | | | | | | | |
Anthony Raab | | | | | | | | | | | | | | | | | | | |
Timothy Goodnow | | | | | | | | | | | | | | | | | | | |
Robert Schumm(1) | | | | | | | | | | | | | | | | | | | |
Francine Kaufman | | | | | | | | | | | | | | | | | | | |
Koichiro Sato | | | | | | | | | | | | | | | | | | | |
Number of meetings in 2023 | | | | | 8 | | | | | | 4 | | | | | | 3 | | |
Name | Audit Committee | Compensation Committee | Nominating & Corporate Governance Committee | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Stephen P. DeFalco | X | * | ||||||||
M. James Barrett | X | |||||||||
Steven Edelman | X | |||||||||
Edward J. Fiorentino | X | X | ||||||||
Peter Justin Klein | X | X | ||||||||
Douglas S. Prince | X | * | X | |||||||
Douglas A. Roeder | X | * | X | |||||||
Number of meetings in 2017 | 8 | 3 | 1 |
The Board of Directors has determined that the members of each of the Board of Directors three standing committees meet the applicable NYSE American rules and regulations regarding “independence” and each member is free of any relationship that would impair his or her individual exercise of independent judgment with regard to the Company.
assesses the qualifications of the independent auditors; determines and approves the engagement of the independent auditors; determines whether to retain or terminate the existing independent auditors or to appoint and engage new independent auditors; reviews and approves the retention of the independent auditors to perform any proposed permissible non-audit services; monitors the rotation of partners of the independent auditors on our audit engagement team as required by law; reviews and approves or rejects transactions between us and any related persons; confers with management, third party advisors and the independent auditors regarding the adequacy and effectiveness of internal controlcontrols over financial reporting; oversees and participates in the resolution of internal control issues, where identified; reviews new financial reporting and disclosure requirements and oversees implementation of new accounting standards; establishes procedures, as required under applicable law, for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or auditing matters and the confidential and anonymous submission by employees of concerns regarding questionable accounting or auditing matters; meets with our independent registered public accounting firm to discuss the scope and meets to review our annual auditedresults of its examination and reviews the financial statements and quarterly financial statements with management and the independent auditor, including a review of our disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations"reports contained in our periodic filings.
filings, and reviews and assesses the strength and effectiveness of the Company’s finance team.
2023.
an executive compensation assessment analyzing the current cash and equity compensation of our executive officers, directors and other senior management against compensation for similarly situated executives at our peer group companies. Our management did not have the ability to direct Willis Towers Watson'sWatson’s work.
Directors, and developing a set of corporate governance principles for the Company.
long-term interests of stockholders. In conducting this assessment, the Nominating and Corporate Governance Committee typically considers diversity, age, skills and such other factors as it deems appropriate, given the current needs of us and the Board of Directors, to maintain a balance of knowledge, experience and capability.
to the Audit Committee in accordance with our Amended and Restated Whistleblower Policy that relate to questionable accounting or auditing matters involving us will be promptly and directly forwarded to the Audit Committee.
The
The affirmative vote of the holders of a majority of the shares present in person or represented by proxy and entitled to vote
LLP on any matters of accounting principles or practices, financial statement disclosures or auditing scope or procedures which, if not resolved to Ernst & Young LLP’s satisfaction, would have caused Ernst & Young LLP to make reference thereto in its reports; and (ii) no “reportable events” within the meaning of Item 304(a)(1)(v) of Regulation S-K.
| | | 2023 | | | 2022 | | ||||||
Audit fees(1) | | | | $ | 1,157,020 | | | | | $ | 857,290 | | |
Tax fees(2) | | | | | 38,598 | | | | | | 63,704 | | |
All other fees(3) | | | | | — | | | | | | 5,500 | | |
Total fees | | | | $ | 1,195,618 | | | | | $ | 926,494 | | |
| 2017 | 2016 | |||||
---|---|---|---|---|---|---|---|
Audit fees | $ | 963,953 | $ | 860,689 | |||
Tax Fees | — | 18,500 | (1) | ||||
Total | $ | 963,953 | $ | 879,189 | |||
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| | | | | | | |
The current amended and restated Certificate of Incorporation was most recently amended in October 2020 pursuant to an amendment adopted by our stockholders, and the authorized number of shares of common stock has not been increased since that time. The text of the proposed amendment is set forth on Appendix A to this Proxy Statement.
stock.
The affirmative voteunreserved authorized shares to engage in such transactions.
additional shares of common stock unless required by applicable law or NYSE American listing rules.
| Name | | | Position | | |||
| Executive Officers: | | | | | |||
Timothy T. Goodnow, Ph.D. | | | President, Chief Executive Officer and Director | | ||||
Frederick (“Rick”) Sullivan | | | Chief Financial Officer, Secretary and Treasurer | | ||||
| Mukul Jain, Ph.D. | | | Chief Operating Officer | ||||
Francine R. Kaufman, M.D. | | | Chief Medical Officer and Director | | ||||
Kenneth L. Horton | | General Counsel and | |
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
the state of Maryland.
Ms. Panlilio
and Marketing of Senseonics, Incorporated from June 2014 to December 2015. Prior to joining Senseonics, Incorporated, Ms. Panlilio served as Vice President, Global Marketing and Sales at Viveve, Inc. from October 2012 to May 2014, an Independent Marketing Consultant at MGP Retail Consulting, LLC from May 2011 to June 2014, Vice President of Sales and Marketing for Arkal Medical, Inc. from 2010 to May 2011 and Vice President of Marketing and Sales at VeraLight, Inc. from 2007 to 2010. From 2003 to 2007, Ms. Panlilio worked at Abbott Diabetes Care. Ms. Panlilio received her B.S. in business administration from San Jose State University.
Lynne Kelley, M.D., FACS.,age 55
Dr. Kelley was appointed as our Chief Medical Officer in January 2016. From January 2011 to January 2016, Dr. Kelley was the World Wide Vice President of Medical Affairs Medical Surgical Systems of Becton, Dickinson & Company. Prior to that, Dr. Kelley was the Vice President Medical Director for Kimberly Clark from November 2007 to December 2010. From 2005 to 2007, Dr. Kelley served as the medical directorGeneral Counsel for the peripheral interventionsLife and vascular surgeryAnalytical Sciences business unit of Boston Scientific. Before her assignment with Boston Scientific, Dr. Kelley was an assistant professor of vascular surgeryPerkinElmer, Inc. and radiology at Yale Universityin other roles from 20032000 to 2005. Dr. Kelley isMr. Horton previously practiced law at the law firm Ropes & Gray and was a board certified generalstrategy consultant in both the U.S. and vascular surgeon. Dr. KelleyEurope. Mr. Horton received her M.D.his AB from Dartmouth Medical SchoolCollege and her B.A. in Biologya J.D. from Boston University.
Michael J. Gill,age 48
Mr. Gill was appointed as our Vice President and General Manager, U.S. Region in April 2017. Prior to joining our Company, Mr. Gill served in various positions at Medtronic, Inc., a medical technology and services company, from 1999 to August 2016, most recently as Vice President Americas Region, Intensive Insulin Management Business from 2008 to August 2016. Mr. Gill received his B.S. from the University of New York at Buffalo.
Name of Beneficial Owner | | | Number of Shares Beneficially Owned | | | Percentage of Shares Beneficially Owned | | ||||||
Principal Stockholders: | | | | | | | | | | | | | |
PHC Holdings Corporation(1) | | | | | 86,892,237 | | | | | | 14.1 | | |
Entities affiliated with Robert J. Smith(2) | | | | | 39,380,057 | | | | | | 7.0 | | |
Named Executive Officers, Directors and Director Nominee: | | | | | | | | | | | | | |
Timothy T. Goodnow, Ph.D.(3) | | | | | 7,048,504 | | | | | | 1.3 | | |
Kenneth Horton(4) | | | | | 1,605,989 | | | | | | * | | |
Mukul Jain, Ph.D.(5) | | | | | 3,461,100 | | | | | | * | | |
Stephen P. DeFalco(6) | | | | | 1,996,840 | | | | | | * | | |
Edward J. Fiorentino(7) | | | | | 1,132,531 | | | | | | * | | |
Douglas S. Prince(8) | | | | | 1,037,974 | | | | | | * | | |
Douglas A. Roeder(9) | | | | | 413,464 | | | | | | * | | |
Steven Edelman, M.D.(10) | | | | | 1,106,867 | | | | | | * | | |
Anthony Raab (11) | | | | | 464,527 | | | | | | * | | |
Sharon Larkin(12) | | | | | 299,327 | | | | | | * | | |
Francine Kaufman(13) | | | | | 1,543,055 | | | | | | * | | |
Koichiro Sato | | | | | 0 | | | | | | * | | |
Brian Hansen | | | | | 0 | | | | | | * | | |
All current directors, director nominees and executive officers as a group (14 persons)(14) | | | | | 20,468,859 | | | | | | 3.9 | | |
Name of Beneficial Owner | Number of Shares Beneficially Owned | Percentage of Shares Beneficially Owned | |||||
---|---|---|---|---|---|---|---|
Principal Stockholders: | |||||||
Entities affiliated with New Enterprise Associates, Inc.(1) | 32,641,541 | 23.8 | % | ||||
Entities affiliated with Delphi Ventures(2) | 11,346,946 | 8.3 | |||||
Roche Finance Ltd.(3) | 29,319,010 | 21.4 | |||||
Energy Capital, LLC(4) | 8,013,810 | 5.9 | |||||
Named Executive Officers and Directors: | |||||||
Timothy T. Goodnow, Ph.D.(5) | 3,857,523 | 2.7 | |||||
R. Don Elsey(6) | 832,544 | * | |||||
Mukul Jain(6) | 855,513 | * | |||||
M. James Barrett, Ph.D.(7) | 23,698,931 | 17.3 | |||||
Peter Justin Klein, M.D., J.D.(8) | 66,019 | * | |||||
Stephen P. DeFalco(9) | 764,257 | * | |||||
Edward J. Fiorentino(10) | 147,128 | * | |||||
Douglas S. Prince(6) | 138,529 | * | |||||
Douglas A. Roeder(11) | 11,401,575 | 8.3 | |||||
Steven Edelman, M.D.(12) | 56,842 | * | |||||
All current directors and executive officers as a group (13 persons)(13) | 42,043,967 | 29.2 |
power over, and be the indirect beneficial owners of, the shares held by NEA 10. The shares held by NEA 9 are indirectly held by NEA Partners 9, Limited Partnership, or Partners 9, the sole general partner of NEA 9. The individual general partner of Partners 9 is Peter J. Barris. Partners 9 and Peter J. Barris may be deemed to share voting and dispositive power over, and be the indirect beneficial owners of, the shares held by NEA 9.“pre-funded” warrants. This information has been obtained, in part, from a Schedule 13D/A filed on December 12, 2017March 20, 2023 by NEA 10, NEA 9, Partners 10, Partners 9, M. James Barrett, Peter J. Barris and Scott D. Sandell and from Schedule 13D/A filed on June 9, 2017 by NEA 10, NEA 9, NEA VII, Partners 10, Partners 9, Partners VII, M. James Barrett, Peter J. Barris and Scott D. Sandell.PHC Holdings Corporation, among other sources. The principal business address of NEA 10 and NEA 9PHC Holdings Corporation is 1954 Greenspring Drive, Suite 600, Timonium, MD 21093.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a)2024 and (c) 106,668 shares issuable upon the vesting of the Exchange Act requires our directors and executive officers, and persons who own more than ten percentrestricted stock units that vest within 60 days of a registered classApril 1, 2024.
To our knowledge, based solely upon a reviewrestricted stock units that vest within 60 days of Forms 3 and 4 and amendments thereto furnished to us and written representations provided to us by all of our directors and executive officers and certain of our more than 10% stockholders, we believe that duringApril 1, 2024.
Our Chief Executive Officer and our two other most highly compensated executive officers for the year ended December 31, 2017 were:
We refer to these executive officers in this proxy statement asOfficer; and
General Counsel and Corporate Development Advisor.
Name and Principal Position Year | | | Year | | | Salary | | | Bonus ($)(1) | | | Stock Awards ($)(2) | | | Non-Equity Incentive Plan Compensation ($)(3) | | | All Other Compensation ($)(4) | | | Total ($) | | |||||||||||||||||||||
Timothy T. Goodnow President and Chief Executive | | | | | 2023 | | | | | | 613,000 | | | | | | — | | | | | | 2,308,740 | | | | | | 615,300 | | | | | | 52,720 | | | | | | 3,589,760 | | |
| | | 2022 | | | | | | 585,999 | | | | | | 109,000 | | | | | | 2,206,241 | | | | | | 600,476 | | | | | | 43,938 | | | | | | 3,545,654 | | | ||
Mukul Jain, Ph.D. Chief Operating Officer | | | | | 2023 | | | | | | 474,000 | | | | | | — | | | | | | 787,885 | | | | | | 237,825 | | | | | | 57,345 | | | | | | 1,785,242 | | |
| | | 2022 | | | | | | 453,000 | | | | | | 30,000 | | | | | | 952,201 | | | | | | 232,219 | | | | | | 52,427 | | | | | | 1,719,847 | | | ||
Kenneth Horton General Counsel and Corporate Development Advisor | | | | | 2023 | | | | | | 464,000 | | | | | | — | | | | | | 575,774 | | | | | | 233,100 | | | | | | 40,183 | | | | | | 1,313,057 | | |
| | | 2022 | | | | | | 444,000 | | | | | | 28,000 | | | | | | 552,201 | | | | | | 227,673 | | | | | | 2,658 | | | | | | 1,254,532 | | |
Name and Principal Position | Year | Salary ($) | Option Awards ($)(1) | Non-Equity Incentive Plan Compensation ($)(2) | Total ($) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Timothy T. Goodnow | 2017 | 520,000 | 1,214,775 | 292,584 | 2,027,359 | |||||||||||
President and Chief Executive Officer | 2016 | 475,998 | 586,871 | 318,150 | 1,381,019 | |||||||||||
R. Don Elsey | 2017 | 376,000 | 507,599 | 141,000 | 1,024,599 | |||||||||||
Chief Financial Officer | 2016 | 355,625 | 472,275 | 153,300 | 981,200 | |||||||||||
Mukul Jain(3) | 2017 | 376,000 | 507,609 | 141,000 | 1,024,609 | |||||||||||
Chief Operating Officer |
chief executive officer for all executives other than the chief executive officer. Based on those discussions and its discretion, our compensation committeeCompensation Committee then approves the compensation of each executive officer after discussions without members of management present.
Senseonics, Incorporated
Name | | | 2022 Base Salary ($) | | | % Increase | | | 2023 Base Salary ($) | | | % Increase | | | 2024 Base Salary ($) | | |||||||||||||||
Timothy T. Goodnow | | | | | 586,000 | | | | | | 4.6% | | | | | | 613,000 | | | | | | 0% | | | | | | 613,000 | | |
Mukul Jain | | | | | 453,000 | | | | | | 4.6% | | | | | | 474,000 | | | | | | 4.0% | | | | | | 492,960 | | |
Kenneth Horton | | | | | 444,000 | | | | | | 4.6% | | | | | | 464,000 | | | | | | 3.0% | | | | | | 477,920 | | |
Name | 2016 Base Salary ($) | 2017 Base Salary ($) | 2018 Base Salary ($) | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Timothy T. Goodnow | 505,000 | 520,000 | 536,000 | |||||||
R. Don Elsey | 365,000 | 376,000 | 387,700 | |||||||
Mukul Jain | (1) | 376,000 | 395,000 |
Annual Bonus
Name | Target Bonus (as a % of Base Salary) (%) 2016 | Target Bonus (as a % of Base Salary) (%) 2017 | Target Bonus (as a % of Base Salary) (%) 2018 | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Timothy T. Goodnow | 60 | 75 | 75 | |||||||
R. Don Elsey | 40 | 50 | 50 | |||||||
Mukul Jain | (1) | 50 | 50 |
Name
(as a % of Base Salary)
(%) 2022
(as a % of Base Salary)
(%) 2023 Timothy T. Goodnow 100 100 Mukul Jain 50 75 Kenneth Horton 50 50
compensation committee awarded Compensation Committee determined that we had achieved 100% of the corporate objectives, entitling each of Dr. Goodnow and Mr. Elsey 105%named executive officer to 100% of their target bonuses based on their 2016respective 2023 base salary.
For 2017, bonuses were based on oursalaries.
These actual bonus amountsobjectives are reflected in the "Non-Equity“Non-Equity Incentive Plan Compensation"Compensation” column of the Summary Compensation Table above.
We award
Name | | | RSUs | | |||
Timothy T. Goodnow | | | | | 3,136,023 | | |
Mukul Jain | | | | | 1,380,157 | | |
Kenneth Horton | | | | | 782,089 | | |
Name | | | RSUs | | |||
Timothy T. Goodnow | | | | | 1,762,932 | | |
Mukul Jain | | | | | 775,863 | | |
Kenneth Horton | | | | | 431,035 | | |
Name | | | Cash Payments | | | RSUs | | ||||||
Timothy T. Goodnow | | | | $ | 109,000 | | | | | | 139,000 | | |
Mukul Jain | | | | $ | 30,000 | | | | | | 45,000 | | |
Kenneth Horton | | | | $ | 28,000 | | | | | | 45,000 | | |
| | | Option Awards | | | Stock Awards | | ||||||||||||||||||||||||||||||
| | | Number of Securities Underlying Unexercised Options (#) | | | Number of Securities Underlying Unexercised Options (#) | | | Options 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) | | ||||||||||||||||||
| | | Exercisable | | | Unexercisable | | | ($) | | | (#) | | | ($) | | |||||||||||||||||||||
Name (a) | | | (b) | | | (c) | | | (e) | | | (f) | | | (g) | | | (h) | | ||||||||||||||||||
Timothy T. Goodnow | | | | | 173,113 | | | | | | 0 | | | | | $ | 1.95 | | | | | | 7/23/2025 | | | | | | 274,865(2) | | | | | $ | 156,673.05 | | |
| | | 347,652 | | | | | | 0 | | | | | $ | 2.97 | | | | | | 4/11/2026 | | | | | | 881,466(3) | | | | | $ | 502,435.62 | | | ||
| | | 750,000 | | | | | | 0 | | | | | $ | 2.74 | | | | | | 1/16/2027 | | | | | | 2,352,017(4) | | | | | $ | 1,340,649.69 | | | ||
| | | 777,797 | | | | | | 0 | | | | | $ | 2.62 | | | | | | 2/1/2028 | | | | | | — | | | | | | — | | | ||
| | | 800,000 | | | | | | 0 | | | | | $ | 2.72 | | | | | | 1/16/2029 | | | | | | — | | | | | | — | | | ||
Mukul Jain | | | | | 155,599 | | | | | | 0 | | | | | $ | 0.54 | | | | | | 6/3/2024 | | | | | | 100,806(2) | | | | | $ | 57,459.42 | | |
| | | 108,686 | | | | | | 0 | | | | | $ | 0.54 | | | | | | 12/4/2024 | | | | | | 387,931(3) | | | | | $ | 221,120.67 | | | ||
| | | 134,239 | | | | | | 0 | | | | | $ | 1.95 | | | | | | 7/23/2025 | | | | | | 1,035,118(4) | | | | | $ | 590,017.26 | | | ||
| | | 145,254 | | | | | | 0 | | | | | $ | 2.97 | | | | | | 4/11/2026 | | | | | | — | | | | | | — | | | ||
| | | 314,212 | | | | | | 0 | | | | | $ | 2.73 | | | | | | 1/19/2027 | | | | | | — | | | | | | — | | | ||
| | | 495,191 | | | | | | 0 | | | | | $ | 2.62 | | | | | | 2/1/2028 | | | | | | — | | | | | | — | | | ||
| | | 535,000 | | | | | | — | | | | | $ | 2.72 | | | | | | 1/16/2029 | | | | | | — | | | | | | — | | | ||
Kenneth Horton | | | | | 223,500 | | | | | | 0 | | | | | $ | 2.62 | | | | | | 11/14/2027 | | | | | | 76,613(2) | | | | | $ | 43,669.41 | | |
| | | 124,000 | | | | | | 0 | | | | | $ | 3.18 | | | | | | 3/7/2028 | | | | | | 215,517(3) | | | | | $ | 122,844.69 | | | ||
| | | 190,000 | | | | | | 0 | | | | | $ | 2.72 | | | | | | 1/16/2029 | | | | | | 586,567(4) | | | | | $ | 334,343.19 | | |
In April 2016, our Board of Directors awarded to Dr. Goodnow and Mr. Elsey options to purchase 347,652 and 279,767 sharesclosing price of our common stock respectively. Each of these options was issued with an exercise price$0.57 per share on December 29, 2023, the last trading day of $2.97 per share. The shares underlying the options granted to Dr. Goodnow and Mr. Elsey2023.
In January 2017, our compensation committee awarded to Dr. Goodnow and Mr. Elsey options to purchase 750,000 and 313,391 shares of our common stock, respectively. In January 2017, our Board of Directors awarded to Dr. Jain an option to purchase 314,202 shares of our common stock. The options issued to Dr. Goodnow and Mr. Elsey have an exercise price of $2.74 per share. The option issued to Dr. Jain has an exercise price of $2.73 per share. The shares underlying the options granted to Dr. Goodnow, Mr. Elsey and Dr. Jainapplicable vesting date.
In February 2018, ourpay for performance compensation committee awardedphilosophy and how we seek to Dr. Goodnow, Mr. Elseyalign executive compensation with the Company’s performance, refer to “Executive Compensation” beginning on page 28.
Outstanding Equity Awards at End of 2017
The following table providessets forth information about outstanding Company Options held by each ofconcerning Compensation Actually Paid (“CAP”) to our Principal Executive Officer (“PEO”) and our non-PEO named executive officers at December versus our total shareholder return (“TSR”), total revenue and net income (loss) performance results for the last three fiscal years. The
Year | | | Summary Compensation Table Total for PEO(1) | | | Compensation Actually Paid to PEO(1)(2) | | | Average Summary Compensation Table Total for Non-PEO Named Executive Officers(3) | | | Average Compensation Actually Paid to Non-PEO Named Executive Officers(4) | | | Value of Initial Fixed $100 Investment Based On: | | | | |||||||||||||||||||||||||
| Total Shareholder Return(5) | | | Total Revenue ($M)(6) | | | Net Income (Loss) ($M)(6) | | |||||||||||||||||||||||||||||||||||
2023 | | | | $ | 3,589,760 | | | | | $ | 1,988,481 | | | | | $ | 1,549,150 | | | | | $ | 994,090 | | | | | $ | 65.39 | | | | | $ | 22.4 | | | | | $ | (60.4) | | |
2022 | | | | $ | 3,545,654 | | | | | $ | (1,088,335) | | | | | $ | 1,487,190 | | | | | $ | (182,626) | | | | | $ | 118.15 | | | | | $ | 16.4 | | | | | $ | 142.1 | | |
2021 | | | | $ | 3,145,225 | | | | | $ | 10,393,425 | | | | | $ | 1,293,093 | | | | | $ | 4,093,093 | | | | | $ | 306.26 | | | | | $ | 13.7 | | | | | $ | (302.5) | | |
| | | 2021 | | | 2022 | | | 2023 | | |||||||||
Summary Compensation Table Total | | | | $ | 3,145,225 | | | | | $ | 3,545,654 | | | | | $ | 3,589,760 | | |
Subtract Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year(a) | | | | $ | (2,044,999) | | | | | $ | (2,206,241) | | | | | $ | (2,308,740) | | |
Add Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year(b) | | | | $ | 2,201,673 | | | | | $ | 1,505,035 | | | | | $ | 1,340,885 | | |
Adjust for Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Year(b) | | | | $ | 3,657,744 | | | | | $ | (2,474,711) | | | | | $ | (531,797) | | |
Adjust for Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year(b) | | | | $ | 1,029,371 | | | | | $ | 489,412 | | | | | $ | 540,729 | | |
Adjust for Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year(b) | | | | $ | 2,404,411 | | | | | $ | (1,947,484) | | | | | $ | (642,356) | | |
Subtract Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year(b) | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 0 | | |
Add Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 0 | | |
Compensation Actually Paid | | | | $ | 10,393,425 | | | | | $ | (1,088,335) | | | | | $ | 1,988,481 | | |
| 2021 | | | 2022 | | | 2023 | |
| Mukul Jain | | | Mukul Jain | | | Mukul Jain | |
| Francine Kaufman | | | Kenneth Horton | | | Kenneth Horton | |
| | | 2021 | | | 2022 | | | 2023 | | |||||||||
Summary Compensation Table Total | | | | $ | 1,293,093 | | | | | $ | 1,487,190 | | | | | $ | 1,549,150 | | |
Subtract Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year(a) | | | | $ | (628,999) | | | | | $ | (752,201) | | | | | $ | (795,923) | | |
Add Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year(b) | | | | $ | 677,188 | | | | | $ | 512,514 | | | | | $ | 462,261 | | |
Adjust for Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Year(b) | | | | $ | 1,457,542 | | | | | $ | (879,966) | | | | | $ | (179,561) | | |
Adjust for Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year(b) | | | | $ | 316,613 | | | | | $ | 167,525 | | | | | $ | 186,413 | | |
Adjust for Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year(b) | | | | $ | 977,656 | | | | | $ | (717,688) | | | | | $ | (228,250) | | |
Subtract Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year(b) | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 0 | | |
Add Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 0 | | |
Compensation Actually Paid | | | | $ | 4,093,093 | | | | | $ | (182,626) | | | | | $ | 994,090 | | |
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Timothy T. Goodnow | 2,038,610 | — | 0.54 | 12/1/2020 | |||||||||
589,093 | — | 0.54 | 2/27/2021 | ||||||||||
360,058 | 65,547 | (2) | 0.54 | 6/3/2024 | |||||||||
112,710 | 87,177 | (3) | 1.95 | 7/24/2025 | |||||||||
144,855 | 202,797 | (5) | 2.97 | 4/12/2026 | |||||||||
171,875 | 578,125 | (6) | 2.74 | 1/17/2027 | |||||||||
R. Don Elsey | 460,575 | 189,649 | (4) | 0.54 | 2/8/2025 | ||||||||
81,103 | 53,137 | (3) | 1.95 | 7/24/2025 | |||||||||
116,569 | 163,198 | (5) | 2.97 | 4/12/2026 | |||||||||
71,819 | 241,572 | (6) | 2.74 | 1/17/2027 | |||||||||
Mukul Jain | 27,437 | — | 0.54 | 1/2/2022 | |||||||||
153,774 | — | 0.46 | 9/11/2023 | ||||||||||
293,649 | 41,950 | (2) | 0.54 | 6/3/2024 | |||||||||
81,515 | 27,171 | (7) | 0.54 | 12/4/2024 | |||||||||
81,102 | 53,137 | (3) | 1.95 | 7/24/2025 | |||||||||
60,522 | 84,732 | (5) | 2.97 | 4/12/2026 | |||||||||
72,007 | 242,205 | (6) | 2.73 | 1/20/2027 |
Agreement with Dr. Goodnow
Agreement with Mr. Elsey
In July 2015, Senseonics, Incorporated entered into an amended and restated employment agreement with Mr. Elsey that governs the terms of his employment with us. Pursuant to the agreement, Mr. Elsey was originally entitled to an annual base salary of $320,000 and was originally eligible to receive an annual performance bonus of up to 35% of his base salary, as determined by our Board of Directors. If Mr. Elsey's employment is terminated by us for reasons other than for cause or if he resigns for good reason (each as defined in his employment agreement), he would be entitled to receive severance payments equal to continued payment of his base salary for one year, a prorated portion of his target bonus for the year in which his service is terminated, employee benefit coverage for up to one year, and reimbursement of expenses owed to him through the date of his termination. If Mr. Elsey's employment is terminated by us other than for cause or if he resigns for good reason, coincident with a change in control (as defined in his employment agreement), he would be entitled to the benefits described above, although in lieu of the bonus described above, he would be entitled to 125% of his target bonus, and 50% of his then unvested equity awards would become fully vested. Additionally, if Mr. Elsey's employment is terminated by us or any successor entity without cause within 12 months following a change in control, then 100% of his then unvested equity awards shall become fully vested, and the options granted to Mr. Elsey in 2016, 2017 and 2018 will become fully vested upon a change in control as further described above under the section titled "Narrative to Summary Compensation Table—Long-Term Incentives."
Agreement with Dr. Jain
one year, and reimbursement of expenses owed to him through the date of his termination. If Dr. Jain'sJain’s employment is terminated by us other than forwithout cause or if he resigns for good reason, coincident with a change in control (as defined in his employment agreement), he would be entitled to the benefits described above, although in lieu of the bonus described above, he would be entitled to 125% of his target bonus.bonus, and 50% of his then unvested equity awards would become fully vested. Additionally, if Dr. Jain'sJain’s employment is terminated by us or any successor entity without cause within 12 months following a change in control, then 100% of his then unvested equity awards shallwould become fully vested, andvested. Additionally, all of the options granted to Dr. Jain prior to our public offering in 2017 and 2018March 2016 will become fully vested upon a change in control.
401(k) Plan
The Senseonics, Incorporated board of directors adopted our 2015 Equity Incentive Plan (the "2015 plan"), on December 1, 2015, and the Senseonics, Incorporated stockholders subsequently approved the 2015 Plan on December 4, 2015. In connection with the Acquisition, we assumed the 2015 plan, including all awards that were then outstanding under the 2015 plan. In connection with our 2016 public offering, in February 2016, our Board of Directors adopted and our stockholders approved an Amended and Restated 2015 Equity Incentive Plan, or the amended and restated 2015 plan. The amended and restated 2015 plan became effective on March 17, 2016.
Authorized Shares
The number of shares of common stock that may be issued pursuant to equity awards under the 2015 plan was initially 839,000 shares. Pursuant to the amended and restated 2015 plan, which become effective upon the pricing of our 2016 public offering, the number of shares of common stock that may be issued pursuant to equity awards was initially up to 17,251,115 shares, representing 8,000,000 shares plus up to an additional 9,251,115 shares, in the event that options that were outstanding under the 1997 plan as of February 16, 2016 expire or otherwise terminate without having been exercised (in such case, the shares not acquired will revert to and become available for issuance under the amended and restated 2015 plan). The number of shares of our common stock reserved for issuance under our amended and restated 2015 plan will automatically increase on January 1 of each year, beginning on January 1, 2017 and ending on January 1, 2026, by 3.5% of the total number of shares of our common stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares as may be determined by our Board of Directors. The maximum number of shares that may be issued pursuant to exercise of incentive stock options under the amended and restated 2015 plan will be 17,251,115 shares. As of December 31, 2017, a total of 2,554,921 shares were available for future issuance and options to purchase 16,395,080 shares of common stock at a weighted average exercise price of $1.61 per share were outstanding. As of January 1, 2018, the number of shares of common stock that may be issued under the amended and restated 2015 plan was automatically increased by 4,790,896 shares,
representing 3.5% of the total number of shares of common stock outstanding on December 31, 2017, increasing the number of shares of common stock remaining available for issuance under the amended and restated 2015 plan to 7,474,634 shares.
Shares issued under our 2015 plan may be authorized but unissued or reacquired shares of our common stock. Shares subject to stock awards granted under our 2015 plan that expire or terminate without being exercised in full, or that are paid out in cash rather than in shares, will not reduce the number of shares available for issuance under our 2015 plan. Additionally, shares issued pursuant to stock awards under our 2015 plan that we repurchase or that are forfeited, as well as shares reacquired by us as consideration for the exercise or purchase price of a stock award or to satisfy tax withholding obligations related to a stock award, will become available for future grant under our 2015 plan.
Administration
Our Board of Directors, or a duly authorized committee thereof, has the authority to administer our 2015 plan. Our Board of Directors has delegated its authority to administer our 2015 plan to our compensation committee under the terms of the Compensation Committee's charter. Our Board of Directors may also delegate to one or more of our officers the authority to (i) designate employees other than officers to receive specified stock awards and (ii) determine the number of shares of our common stock to be subject to such stock awards. Subject to the terms of our 2015 plan, the administrator has the authority to determine the terms of awards, including recipients, the exercise price or strike price of stock awards, if any, the number of shares subject to each stock award, the fair market value of a share of our common stock, the vesting schedule applicable to the awards, together with any vesting acceleration, the form of consideration, if any, payable upon exercise or settlement of the stock award and the terms and conditions of the award agreements for use under our 2015 plan.
The administrator has the power to modify outstanding awards under our 2015 plan. Subject to the terms of our 2015 plan, the administrator has the authority to reprice any outstanding option or stock appreciation right, cancel and re-grant any outstanding option or stock appreciation right in exchange for new stock awards, cash or other consideration or take any other action that is treated as a repricing under GAAP with the consent of any adversely affected participant.
Section 162(m) Limits
No participant may be granted stock awards covering more than 1,000,000 shares of our common stock under our 2015 plan during any calendar year pursuant to stock options, stock appreciation rights and other stock awards whose value is determined by reference to an increase over an exercise price or strike price of at least 100% of the fair market value of our common stock on the date of grant. Additionally, no participant may be granted in a calendar year a performance stock award covering more than 1,000,000 shares of our common stock or a performance cash award having a maximum value in excess of $3.0 million under our 2015 plan. Prior to the repeal of the exemption from the deduction limit for "performance-based compensation" under Section 162(m) of the Code under the Tax Cuts and Jobs Act, these limitations enabled us to grant awards that are intended to be exempt from the $1.0 million limitation on the income tax deductibility of compensation paid per covered executive officer imposed by Section 162(m) of the Code.
Performance Awards
Our 2015 plan permits the grant of performance-based stock and cash awards that was eligible to qualify as performance-based compensation that is not subject to the $1.0 million limitation on the income tax deductibility of compensation paid per covered executive officer imposed by Section 162(m) of the Code prior to the repeal of that exemption. To enable us to grant performance-based awards that will qualify, our compensation committee can structure such awards so that the stock or cash will be issued or paid pursuant to such award only following the achievement of specified pre-established performance goals during a designated performance period.
Corporate Transactions
Our 2015 plan provides that in the event of a specified corporate transaction, including without limitation a consolidation, merger or similar transaction involving our Company, the sale, lease or other disposition of all or substantially all of the assets of our Company or the consolidated assets of our Company and our subsidiaries, or a sale or disposition of at least 50% of the outstanding capital stock of our Company, the administrator will determine how to treat each outstanding equity award. The administrator may:
The administrator is not obligated to treat all equity awards or portions of equity awards, even those that are of the same type, in the same manner. The administrator may take different actions with respect to the vested and unvested portions of an equity award.
Change of Control
The administrator may provide, in an individual award agreement or in any other written agreement between us and the participant, which the equity award will be subject to additional acceleration of vesting and exercisability in the event of a change of control. In the absence of such a provision, no such acceleration of the award will occur.
Plan Amendment or Termination
Our Board of Directors has the authority to amend, suspend or terminate our 2015 plan, provided that such action does not materially impair the existing rights of any participant without such participant's written consent. No incentive stock options may be granted after the tenth anniversary of the date our Board of Directors adopted our 2015 plan.
1997 Stock Option Plan
The Board of Directors and stockholders of Senseonics, Incorporated approved the 1997 plan, which became effective in March 1997, and it was further amended and restated by the Senseonics, Incorporated board of directors and stockholders most recently in June 2011. In connection with the Acquisition, we assumed the 1997 plan. As of December 31, 2017, there were outstanding stock options covering a total of 8,313,601 shares granted under the 1997 plan.
Upon the effectiveness of the 2015 Plan, we no longer grant awards under the 1997 plan.
Types of Awards. The 1997 plan provided for the grant of incentive stock options and nonqualified stock options. Nonqualified stock options may be granted to employees, including officers, non-employee directors and consultants of us and our affiliates. Incentive stock options may be granted only to employees.
Share Reserve. The aggregate number of shares of common stock reserved for issuance pursuant to stock options under the 1997 plan was 10,644,109 shares, less any shares issued as restricted stock, which was also the maximum number of shares that may be issued upon the exercise of ISOs under the 1997 plan.
If a stock option granted under the 1997 plan expires, terminates or is otherwise canceled without being exercised in full, or if we reacquire shares of unvested common stock issued pursuant to the founder's stock purchase agreements, the shares of our common stock not acquired pursuant to the stock option or forfeited will again become available for subsequent issuance as options under the 2015 plan.
Administration. Our Board of Directors, or a duly authorized committee thereof, has the authority to administer the 1997 plan. Subject to the terms of the 1997 plan, the Board of Directors or the authorized committee, referred to herein as the plan administrator, had full power and authority to take all actions and make all determinations required or provided under the 1997 plan and any stock option agreement for stock options granted under the 1997 plan. The plan administrator determined recipients, dates of grant, the numbers and types of stock options to be granted and the terms and conditions of the stock options, including the period of their exercisability and vesting schedule. Subject to the limitations set forth below, the plan administrator also determined the exercise price of stock options granted and the types of consideration to be paid upon exercise of stock options.
Stock Options. Incentive stock options and nonqualified stock options were granted pursuant to stock option agreements adopted by the plan administrator. The plan administrator determined the exercise price for a stock option, within the terms and conditions of the 1997 plan, provided that the exercise price of a stock option cannot be less than the greater of par value or 100% of the fair market value of our common stock on the date of grant. Options granted under the 1997 plan vest at the rate specified by the plan administrator.
The plan administrator determined the term of stock options granted under the 1997 plan. In accordance with an optionholder's stock option agreement, if an optionholder's service relationship with us, or any of our affiliates, ceases for any reason other than disability, death or cause, the optionholder may generally exercise any vested options for a period of three months following the cessation of service. If an optionholder's service relationship with us or any of our affiliates ceases due to disability or death, the optionholder may generally exercise any vested options for a period of 12 months following disability or death. In the event of a termination for cause, options generally terminate immediately upon the termination of the individual for cause. In no event may an option be exercised beyond the expiration of its term.
Acceptable consideration for the purchase of common stock issued upon the exercise of a stock option were determined by the plan administrator and included in the option agreement and may include (i) cash or check, (ii) the tender of shares of the common stock of Senseonics, Incorporated previously owned by the optionholder, (iii) a combination of the foregoing, and (iv) after our shares of common stock become publicly traded on an established securities market, a broker-assisted cashless exercise.
Unless the plan administrator provides otherwise in the stock option agreement governing the terms of the option, options generally are not transferable except by will, the laws of descent and distribution, or pursuant to a domestic relations order.
Tax Limitations on Incentive Stock Options. The aggregate fair market value, determined at the time of grant, of our common stock with respect to incentive stock options that are exercisable for the first time by an optionholder during any calendar year under all of our stock plans may not exceed $100,000. Options or portions thereof that exceed such limit will generally be treated as nonqualified stock options. No incentive stock option may be granted to any person who, at the time of the grant,
owns or is deemed to own stock possessing more than 10% of our total combined voting power or that of any of our affiliates unless (i) the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant, and (ii) the option is not exercisable after the expiration of five years from the date of grant.
Changes to Capital Structure. In the event that there is a specified type of change in our capital structure, such as a stock split or recapitalization, appropriate adjustments will be made to (i) the class and maximum number of shares reserved for issuance under the 1997 plan and (ii) the class and number of shares and exercise price, strike price, or purchase price of all outstanding stock options.
Certain Reorganizations and Mergers. If we are the surviving corporation in any reorganization, merger or consolidation with any other corporation, the number and class of shares and the exercise price subject to stock options previously granted under the 1997 plan will be proportionately adjusted to reflect the transaction.
Other Corporate Transactions. In the event of (i) our dissolution or liquidation, (ii) a merger, consolidation or reorganization following which we are not the surviving corporation, (iii) a sale of substantially all of our assets to another person or entity or (iv) any transaction that results in a change in control, the 1997 plan and all stock options granted under the 1997 plan will terminate, unless in connection with the transaction the Board of Directors approves the continuation of the 1997 plan, the assumption of outstanding stock options by the successor corporation or the substitution of outstanding options for new options covering stock of the successor corporation or its parent, with appropriate adjustments to the number and kind of shares and the exercise prices of the stock options. In the event the 1997 plan and outstanding stock options are terminated in connection with a transaction, the optionholders will have an opportunity to exercise their vested outstanding stock options before the occurrence of the transaction during such period as determined by the Board of Directors in its sole discretion.
Under the 1997 plan, a change in control is generally defined as any transaction that results in any person or entity, other than a person or entity who was a holder of Senseonics, Incorporated securities on June 30, 1998, owning 50% or more of the combined voting power of all classes of our stock, unless (i) the person or entity becomes the owner of 50% or more of the combined voting power of our stock due to our issuing new securities to the person or entity (other than an issuance pursuant to an underwritten public offering in which the acquisition is not approved by the Board of Directors) or (ii) at least two-thirds of members of the Board of Directors determine that the transaction does not constitute a change in control for purposes of the 1997 plan.
Amendment and Termination. The Senseonics, Incorporated board of directors has the authority to amend, suspend, or terminate the 1997 plan, provided that such action does not alter or impair the existing rights or obligations of any participant without such participant's written consent.
2016 Employee Stock Purchase Plan
In February 2016, our Board of Directors adopted and our stockholders approved a 2016 Employee Stock Purchase Plan, or our 2016 ESPP. The 2016 ESPP became effective on March 17, 2016. We have no current plans to grant purchase rights under our 2016 ESPP.
The maximum number of shares of our common stock that may be issued under our 2016 ESPP was initially 800,000 shares. Additionally, the number of shares of our common stock reserved for issuance under our 2016 ESPP will automatically increase on January 1 of each year, beginning on January 1, 2017 and ending on and including January 1, 2026, by 1.0% of the total number of shares of our common stock outstanding on December 31 of the preceding calendar year; provided, however, our Board of Directors may act prior to the first day of any calendar year to provide that there will be no January 1 increase in the share reserve for such calendar year or that the increase in the share reserve
for such calendar year will be a lesser number of shares of common stock. As of January 1, 2018, the number of shares of common stock that may be issued under the 2016 ESPP was automatically increased by 1,368,827 shares, representing 1.0% of the total number of shares of common stock outstanding on December 31, 2017, increasing the number of shares of common stock available for issuance under the amended and restated 2015 plan to 3,104,523 shares. Shares subject to purchase rights granted under our 2016 ESPP that terminate without having been exercised in full will not reduce the number of shares available for issuance under our 2016 ESPP.
Our Board of Directors, or a duly authorized committee thereof, will administer our 2016 ESPP. We expect our Board of Directors will delegate its authority to administer our 2016 ESPP to our Compensation Committee under the terms of the Compensation Committee's charter.
Employees, including executive officers, of ours or any of our designated affiliates may have to satisfy one or more of the following service requirements before participating in our 2016 ESPP, as determined by the administrator: (i) customary employment with us or one of our affiliates for more than 20 hours per week and more than five months per calendar year; or (ii) continuous employment with us or one of our affiliates for a minimum period of time, not to exceed two years, prior to the first date of an offering. An employee may not be granted rights to purchase stock under our 2016 ESPP if such employee (i) immediately after the grant would own stock possessing 5% or more of the total combined voting power or value of all classes of our common stock, or (ii) holds rights to purchase stock under our 2016 ESPP that would accrue at a rate that exceeds $25,000 worth of our stock for each calendar year that the rights remain outstanding.
A component of our 2016 ESPP is intended to qualify as an employee stock purchase plan under Section 423 of the Code and the provisions of this component will be construed in a manner that is consistent with the requirements of Section 423 of the Code. In addition, the 2016 ESPP authorizes the grant of options to purchase shares of our common stock that do not meet the requirements of Section 423 of the Code because of deviations necessary to permit participation in the 2016 ESPP by employees who are foreign nationals or employed outside of the United States while complying with applicable foreign laws. Any such options must be granted pursuant to rules, procedures or subplans adopted by our Board of Directors designed to achieve these objectives for eligible employees and our Company. The administrator may specify offerings with a duration of not more than 27 months, and may specify one or more shorter purchase periods within each offering. Each offering will have one or more purchase dates on which shares of our common stock will be purchased for the employees who are participating in the offering. The administrator, in its discretion, will determine the terms of offerings under our 2016 ESPP.
Our 2016 ESPP permits participants to purchase shares of our common stock through payroll deductions of up to 15% of their earnings. Unless otherwise determined by the administrator, the purchase price of the shares will be 85% of the lower of the fair market value of our common stock on the first day of an offering or on the date of purchase. Participants may end their participation at any time during an offering and will be paid their accrued contributions that have not yet been used to purchase shares. Participation ends automatically upon termination of employment with us.
A participant may not transfer purchase rights under our 2016 ESPP other than by will, the laws of descent and distribution or as otherwise provided under our 2016 ESPP.
In the event of a specified corporate transaction, such as a merger or change in control of our Company, a successor corporation may assume, continue or substitute each outstanding purchase right. If the successor corporation does not assume, continue or substitute for the outstanding purchase rights, the offering in progress will be shortened and a new exercise date will be set. The participants' purchase rights will be exercised on the new exercise date and such purchase rights will terminate immediately thereafter.
Our Board of Directors has the authority to amend, suspend or terminate our 2016 ESPP, at any time and for any reason. Our 2016 ESPP will remain in effect until terminated by our Board of Directors in accordance with the terms of the 2016 ESPP.
Non-Employee Director Compensation
In February 2016, our Board of Directors approved a non-employee director compensation policy pursuant to which became effective upon the completion of our 2016 public offering. Under this director compensation policy, we pay each of our non-employee directors a cash retainer for service on the Board of Directors and for service on each committee on which the director is a member. The chairman of each committee receives a higher retainer for such service. These retainers are payable in arrears in four equal quarterly installments on the last day of each quarter, provided that the amount of such payment is prorated for any portion of such quarter that the director is not serving on our Board of Directors. No retainers were paid in respectThe compensation payable under the compensation policy has been determined based upon market data of any period prior to the completion of our 2016 public offering.comparable companies and recommendations presented by Willis Towers Watson. The cash retainers paid to non-employee directors for service on the Board of Directors and for service on each committee of the Board of Directors on which the director is a member are as follows:
| Member Annual Service Retainer | Chairman Additional Annual Service Retainer | |||||
---|---|---|---|---|---|---|---|
Board of Directors | $ | 35,000 | $ | 20,000 | |||
Audit Committee | 7,500 | 11,250 | |||||
Compensation Committee | 6,000 | 6,600 | |||||
Nominating and Corporate Governance Committee | 4,000 | 3,625 |
In June 2017, we amended our
| | | Member Annual Service Retainer | | | Chairman Additional Annual Service Retainer | | ||||||
Board of Directors | | | | $ | 40,000 | | | | | $ | 35,000 | | |
Audit Committee | | | | | 10,000 | | | | | | 10,000 | | |
Compensation Committee | | | | | 6,500 | | | | | | 7,500 | | |
Nominating and Corporate Governance Committee | | | | | 5,000 | | | | | | 5,000 | | |
an a named executive officer is set forth above under "Executive Compensation—“Executive Compensation — Summary Compensation Table."
Name | | | Fees Earned or Paid in Cash ($)(1) | | | Stock Awards ($)(2) | | | Total ($) | | |||||||||
Stephen P. DeFalco(3) | | | | $ | 97,500 | | | | | $ | 112,500 | | | | | $ | 210,000 | | |
Edward J. Fiorentino(4) | | | | $ | 56,500 | | | | | $ | 112,500 | | | | | $ | 169,000 | | |
Douglas S. Prince(5) | | | | $ | 70,000 | | | | | $ | 112,500 | | | | | $ | 182,500 | | |
Douglas A. Roeder(6) | | | | $ | 62,250 | | | | | $ | 112,500 | | | | | $ | 174,750 | | |
Steven Edelman(7) | | | | $ | 51,500 | | | | | $ | 112,500 | | | | | $ | 163,400 | | |
Anthony Raab(8) | | | | $ | 40,000 | | | | | $ | 112,500 | | | | | $ | 152,500 | | |
Robert Schumm(9) | | | | | — | | | | | | — | | | | | | — | | |
Sharon Larkin(10) | | | | $ | 46,500 | | | | | $ | 112,500 | | | | | $ | 159,000 | | |
Koichiro Sato(11) | | | | | — | | | | | | — | | | | | | — | | |
Name | Fees Earned or Paid in Cash(1) ($) | Option Awards(2) ($) | Total ($) | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Stephen P. DeFalco(3) | 62,625 | 106,500 | 169,125 | |||||||
M. James Barrett(3) | 39,000 | 106,500 | 145,500 | |||||||
Edward J. Fiorentino(4) | 48,500 | 106,500 | 155,000 | |||||||
Justin Klein(3) | 48,500 | 106,500 | 155,000 | |||||||
Douglas S. Prince(4) | 57,750 | 106,500 | 164,250 | |||||||
Douglas A. Roeder(3) | 51,600 | 106,500 | 158,100 | |||||||
Steven Edelman(5) | 39,000 | 106,500 | 145,500 |
Plan Category | | | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | | | Weighted-average exercise price of outstanding options, warrants and rights (b)(1) | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))(c) | | |||||||||
Equity compensation plans approved by security holders | | | | | 23,725,170(2) | | | | | $ | 1.09 | | | | | | 48,218,464(3) | | |
Equity compensation plans not approved by security holders | | | | | 3,884,396(4) | | | | | $ | 0.81 | | | | | | 7,771,325(5) | | |
Total | | | | | 27,609,566 | | | | | $ | 1.05 | | | | | | 55,989,789 | | |
Plan Category | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Equity compensation plans approved by security holders | 20,840,926 | $ | 1.66 | 2,554,921 | ||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||
Total | 20,840,926 | 2,554,921 |
ParticipationPublic Offering On June 1, 2017, Roche Finance Ltd.2020, we entered into a collaboration and entities affiliatedcommercialization agreement (the “Commercialization Agreement”), with New Enterprise Associates, eachAscensia Diabetes Care Holdings AG (“Ascensia”), an affiliate of PHC Holdings Corporation (“PHC”), which is a holder of morebeneficially owns greater than 5% of our common stock, purchasedstock.
PHC Exchange Warrant Share. On March 31, 2023, the Exchange was consummated, and the Company issued the Exchange Warrant in consideration for the cancellation of the PHC Notes.
We have
The registrationthe PHC Notes, the Company and PHC entered into an investor rights agreement (the “PHC IRA”). Pursuant to the PHC IRA, for so long as PHC and its affiliates hold, in the aggregate on an as-converted basis, at least 15% of the Company’s Common Stock, PHC will have the right to designate two members (the “PHC Designees”) of the Company’s Board of Directors. If PHC and its affiliates hold, in the aggregate on an as-converted basis, at least 5% but less than 15% of the Company’s Common Stock, PHC will have the right to designate one member of the Board. PHC has designated two individuals who are currently serving as directors of the Company, Brian Hansen and Koichiro Sato.
Indemnification Agreements
Our amendedCompany, and restated certificate of incorporation contains provisions limiting the liability of directors, and our amended and restated bylaws provides that we will indemnify each of our directorsotherwise to the fullest extent permitted under Delaware law. Our amendedlaw and restated certificatethe Company’s Bylaws.
In addition, we have entered into an indemnification agreement with ourExchange Act requires the Company’s directors and executive officers.
officers, and persons who own more than 10% of a registered class of the Company’s equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of common stock and other equity securities of the Company. Officers, directors and greater than 10% stockholders are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file.
the persons named in the accompanying proxy to vote on such matters in accordance with their best judgment.
Secretary |
12, 2024