Securities Exchange Act of 1934
☐ | Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only as permitted by Rule14a-6(e)(2)) |
☒ | Definitive Proxy Statement | |
☐ | Definitive Additional Materials | |
☐ | Soliciting Material Pursuant to §240.14a-12 |
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☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act 14-a-6(a)(1) | |||
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Dear Fellow Shareholders,
We are pleased to invite you to attend our firstthe 2023 Annual Meeting of Shareholders of Maravai LifeSciences Holdings, Inc. (“Maravai” or the “Company”) to be held on Wednesday,Thursday, May 19, 2021,18, 2023, at 3:002:30 p.m. Pacific. ThisPacific Time. As we did last year, this year’s Annual Meeting will be conducted virtually, via live audio webcast. Protectingwebcast, making it easy for our shareholders to participate from any location around the health and well-being of the attendees (employees, shareholders and the general public) is our top priority. In light of the recommendations issued by the CDC against public gatherings due to COVID-19, we think a virtual only meeting for this year is advisable.world. You will be able to attend the meeting online and submit questions during the meeting by registering prior to the meeting at www.proxydocs.com/MRVI using your unique control number included on your proxy card or on the instructions that accompanyvoting instruction form you received from your proxy materials. You will be able to vote your shares electronically during the meeting by following the instructions that will be emailed to you uponbank or broker. Upon completion of such registration.registration, you will receive further instructions via email, including your unique link that will allow you to access the Annual Meeting online.
The accompanying notice of meeting and proxy statement providesprovide information about the matters we will ask you to consider at the Annual Meeting, which are:
1. | to elect |
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to ratify the appointment of Ernst & Young LLP as Maravai’s independent registered public accounting firm for the year ending December 31, |
3. | to approve, on a non-binding advisory basis, the compensation of Maravai’s named executive officers, as disclosed in the accompanying proxy statement; and |
to transact other business as may properly come before the meeting or any postponement or adjournment of the meeting. |
OurThe Board has set thea record date asof March 22, 2021.21, 2023 for the Annual Meeting. Only shareholders that owned Maravai Class A common stock or Class B common stock at the close of business on that daydate are entitled to notice of, and may vote at, thisthe meeting or any postponement or adjournment of the meeting. A list of Maravai’s shareholders of record will be available for examination by any shareholder for any purpose relevant to the meeting during ordinary business hours for at least ten days prior to May 19, 202118, 2023, at our corporate headquarters located at 10770 Wateridge Circle Suite 200, San Diego, California 92121, and on the date of the meeting, on the virtual platform for the Annual Meeting. Your vote is important. Whether or not you plan to attend the Annual Meeting, we urge you to vote.vote your shares as soon as possible. You may vote by proxyyour shares over the Internet, by telephone, or by mail by following the instructions on the proxy card.card or voting instruction form you receive. Voting by proxy will ensure your representation at the Annual Meeting regardless of whether you attend.attend online.
Sincerely,
Carl Hull
Interim Chief Executive Officer and Executive Chairman of the Board
NOTICE OF 20212023 ANNUAL MEETING OF SHAREHOLDERS
The 20212023 annual meeting of shareholders of Maravai LifeSciences Holdings, Inc. will be held virtually (please visit www.proxydocs.com/MRVI for virtual meeting registration details) on Wednesday,Thursday, May 19, 2021,18, 2023, at 3:002:30 p.m. Pacific Time for the following purposes:
1. | to elect |
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to ratify the appointment of Ernst & Young LLP as Maravai’s independent registered public accounting firm for the year ending December 31, |
3. | to approve, on a non-binding advisory basis, the compensation of Maravai’s named executive officers, as disclosed in the accompanying proxy statement; and |
to transact other business as may properly come before the meeting or any postponement or adjournment of the meeting. |
A list of shareholders entitled to vote at the meeting will be available for examination by any shareholder for any purpose relevant to the meeting during ordinary business hours for at least ten days prior to May 19, 2021,18, 2023, at 10770 Wateridge Circle Suite 200, San Diego, California 92121, and on the date of the meeting, on the virtual platform for the Annual Meeting.
The proxy statement is first being delivered to the Company’s shareholders as of the record date on or about April 20, 2023.
By Order of the Board of Directors
Kurt Oreshack
General Counsel and Secretary
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to Be Held on May 18, 2023: The notice of meeting, the proxy statement and our 2022 annual report are available free of charge at www.proxydocs.com/MRVI.
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CONTENTS | ||||
COMMONLY ASKED QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING | 1 | |||
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | ||||
PROPOSAL | ||||
PROPOSAL 3 – ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS | 62 | |||
AVAILABILITY OF SEC FILINGS, CODE OF | ||||
COMMONLY ASKED QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING
Q: Why did I receive these materials?
The Board of Maravai is soliciting your proxy to vote at our 20212023 Annual Meeting of Shareholders (or at any postponement or adjournment of the meeting). Shareholders who own shares of our Class A common stock or Class B common stock as of the record date, March 22, 202121, 2023 (the “Record Date”), are entitled to vote at the Annual Meeting. You should review these proxy materials carefully as they give important information about the proposals that will be voted on at the Annual Meeting, as well as other important information about Maravai.
Householding. The Securities and Exchange Commission’s (“SEC”) rules permit us to print an individual’s multiple accounts onsend a single set of annual meeting materials. To take advantage of this opportunity, we have summarized on one set of annual meetingproxy materials all of theto shareholders with multiple accounts registered with the same tax identification number or duplicatewhich share the same last name and household mailing address, unless we received contrary instructions from the impacted shareholdershareholders prior to the mailing date. This procedure is referred to as “householding”. Each registered shareholder will, however, continue to receive separate proxy cards. We agree to deliver promptly, upon written or oral request, a separate copy of the annual meetingproxy materials as requested, to any shareholder to which a single copy of those documents was delivered. If you prefer to receive separate copies of the annual meeting materials, contact www.investorelections.com/MRVIyou may write or call us at the following address or phone number, and we will promptly deliver them.
Maravai LifeSciences Holdings, Inc.
10770 Wateridge Circle Suite 200
San Diego, California 92121
c/o General Counsel and Secretary
Phone: (858) 988-5919
A number of brokerage firmsbanks and brokers have also instituted householding. They will have their own procedures for shareholders who wish to receive individual copies of the proxy materials.materials instead of a combined mailing. If you are a beneficial shareholder and hold your shares in “street name,” please contact your bank or broker.
Q: Who will be entitled to vote?
Shareholders who own shares of our Class A common stock or Class B common stock as of the Record Date, are entitled to vote at the Annual Meeting. As of the Record Date, Maravai had approximately 96,646,515 million131,788,743 shares of Class A common stock and 160,974,129 million119,094,026 shares of Class B common stock outstanding. Holders of shares of Class A common stock and holders of shares of Class B common stock are each entitled to one vote per share.share, voting together as a single class on all matters to be considered at the Annual Meeting. Cumulative voting is not permitted with respect to the election of directors or any other matter to be considered at the Annual Meeting.
Q: What will I be voting on?
You will be voting on:
1. | the election of |
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the ratification of the appointment of Ernst & Young LLP as Maravai’s independent registered public accounting firm for the year ending December 31, |
3. | the approval, on a non-binding advisory basis, of the compensation of our named executive officers, as disclosed in this proxy statement; and |
any other business as may properly come before the meeting or any postponement or adjournment of the meeting. |
Q: How does the Board recommend I vote on these matters?
The Board recommends you vote:
1. | FOR the election of |
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FOR the ratification of the appointment of Ernst & Young as our independent registered public accounting firm for the year ending December 31, |
3. | FOR the approval, on a non-binding advisory basis, of the compensation of our named executive officers, as disclosed in this proxy statement. |
Q: How do I cast my vote?
Beneficial Shareholders. If you hold your shares through a broker, trustee or other nominee, you are a beneficial shareholder. In order to vote your shares, please refer to the materials forwarded to you by your broker, bank or other nominee for instructions on how to vote the shares you hold as a beneficial shareholder.
Registered Shareholders. If you hold shares registered with our transfer agent in your own name, you are a registered stockholdershareholder. Whether or not you plan to attend the Annual Meeting, we urge you to vote your shares as soon as possible to ensure your representation at the Annual Meeting. You may still attend the Annual Meeting and may vote your shares electronically during the virtual Annual Meeting even if you have already voted by registering at any time prior to the start of the meeting at www.proxydocs.com/MRVI. You will need your unique control number included on your proxy card or on the instructions that accompany your proxy materials. Only one person will be able to log in with that unique control number at any time. another method.
You can also vote by proxy before the Annual Meeting in the following ways:
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2. | by phone by calling 1-866-437-3716; or |
3. | by completing, signing and returning a proxy card. |
Proxies submitted viaover the Internet or by telephone or mail must be received prior to the commencement of the Annual Meeting at 3:002:30 p.m. (PDT)Pacific Time on May 19, 2021.18, 2023.
To vote during the virtual Annual Meeting, you must register in advance of the meeting at www.proxydocs.com/MRVI. You will need your unique control number included on your proxy card. Upon completing your registration, you will receive further instructions via email, including information about your unique link that will allow you to access the Annual Meeting and to vote during the Annual Meeting. Please be sure to follow the subsequent instructions that will be delivered to you via email. Only one person will be able to log in with that unique control number at any time.
Beneficial Shareholders. If you hold your shares through a bank, broker, trustee or other nominee in “street” name, you are a beneficial shareholder, and you will receive a voting instruction form from your broker, bank or other nominee seeking instructions from you on how to vote the shares you hold as a beneficial shareholder. To vote during the meeting, you must first obtain a legal proxy from your bank, broker or other nominee and deliver that legal proxy to our Corporate Secretary sufficiently in advance of the Annual Meeting, as well as follow the instructions you receive via email after registering to attend the Annual Meeting online.
Q: Can I access the proxy materials electronically?
Yes. Your proxy card or voting instruction cardform will contain instructions on how to:
1. | view our proxy materials for the Annual Meeting on the Internet; and |
2. | instruct us to send our future proxy materials to you electronically by e-mail. |
Our proxy materials are also available at www.proxydocs.com/MRVI and our proxy materials will be available during the voting period starting on April 19, 2021.MRVI.
Instead of receiving future copies of our proxy statement and annual reports by mail, shareholders of record and most beneficial owners can elect to receive an email that will provide an electronic link to these documents. Your election to receive future proxy materials by email will remain in effect until you revoke it.
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Q: How may I change or revoke my proxy?
Registered Shareholders. Registered shareholders may change a properly executed proxy at any time before its exercise at the Annual Meeting by:
1. | delivering written notice of revocation to our Corporate Secretary at 10770 Wateridge Circle Suite 200, San Diego, California 92121; |
2. | voting electronically during the Annual Meeting; or |
3. | submitting another later dated proxy (including a proxy over the Internet, by telephone or by mail which is received prior to the commencement of the Annual Meeting). |
Beneficial Shareholders. Beneficial shareholders should contact their broker, trustee or nominee for instructions on how to change their proxy vote.
Registered Stockholders. Registered stockholders may change a properly executed proxy at any time before its exercise by:
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Q: How can I attend the Annual Meeting?
The Annual Meeting is being held as a virtual only meeting this year. meeting.
If you are a shareholder of record as of the Record Date, you may attend, vote and ask questions virtually at the meeting by registering at any time prior to the startin advance of the meeting at www.proxydocs.com/MRVI using your unique control number included on your proxy card that accompanies your proxy materials. Upon completing your registration, you will receive further instructions via email, including information about your unique link that will allow you to attend the Annual Meeting and to vote and submit questions during the Annual Meeting.
If you are a beneficial shareholder holding your shares through a bank, broker or other nominee in “street name” as of the Record Date, you may gain access to the meeting by followingregistering in advance at www.proxydocs.com/MRVI using the instructions incontrol number found on the voting instruction card provided by your broker, bank or other nominee. You may notIn order to vote your shares via the Internetelectronically at the Annual Meeting, unless you receivewill first need to obtain a valid legal proxy from your brokerage firm, bank, broker-dealerbroker or other nominee holder. Ifreflecting the number of shares of our Class A common stock or Class B common stock you are not a shareholderheld as of the close of business on the Record Date you may still listenand deliver that legal proxy to our Corporate Secretary sufficiently in advance of the Annual Meeting, butas well as follow the instructions you receive via email.
Online access to the audio webcast of the Annual Meeting will not be ablebegin at approximately 2:15 p.m. Pacific Time on May 18, 2023, pursuant to ask questions or votethe unique access instructions you receive following your advance registration at the meeting.
www.proxydocs.com/MRVI. If you have questions during the live audio webcast of the Annual Meeting, you may type them into the dialog box provided at any point during the meeting (until the floor is closed to questions). TheShareholder questions or comments are welcome, but we will only answer questions pertinent to Annual Meeting matters, subject to time constraints. Questions regarding personal matters and statements of advocacy are not pertinent to Annual Meeting matters and therefore will not be addressed. Questions or comments that are substantially similar may be grouped and answered together to avoid repetition.
Only shareholders as of the Record Date that have registered to attend the meeting may listen to the Annual Meeting and ask questions at the meeting.
An audio broadcastreplay of the Annual Meeting will be archivedavailable at https://investors.maravai.com shortly after the completion of the meeting.
Q: What if I run into technical issues while trying to access the Annual Meeting?
The virtual meeting platform is supported across browsers and devices running the most updated version of applicable software and plug-ins. Participants should give themselves plenty of time to log in and ensure they
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have a strong internet connection and they can hear streaming audio prior to the start of the meeting. Each participant that has registered to attend the meeting will receive a reminder email at approximately 2:00 p.m. Pacific Time on the day of the meeting, which is one hour prior to the meeting start time. The reminder email will include an FAQ link where you will find contact information for the Mediant Help Desk. The Mediant Help Desk will be available starting at least one year.2:00 p.m. Pacific Time until the end of the meeting.
Q: Why is the Annual Meeting virtual only?
We are excited to embrace the latest technology to providesuccessfully held a virtual only annual meeting in 2022 and believe that this meeting format provides ease of access, real-time communication, and cost savings for our shareholders and our company. Hosting a virtual meeting makes it easy for our stockholdersshareholders to attend and participate in the Annual Meeting from any location around the world. Further, in lightworld and provides those of COVID-19, protectingour shareholders who would otherwise not be able to attend the health and well-being ofAnnual Meeting the attendees (employees, directors, shareholders and the general public) is our top priority.opportunity to do so.
Q: What is the voting requirement to approve each of the proposals, and how are the votes counted?
PROPOSAL 1—1 - ELECTION OF DIRECTORS
A plurality of the votes cast by the shares of our common stock present in person or represented by proxy at the meeting and entitled to vote thereon is required to elect each nominee named herein. This means that the fourthree nominees receiving the highest number of “FOR” votes cast at the Annual Meeting will be elected, even if those votes do not constitute a majority of the votes cast. AbstentionsVotes that are “WITHHELD” with respect to one or more nominees will result in the respective nominee receiving fewer votes, but they will not count as votes against a nominee and will have no effect on the outcome of the election of those nominees because directors are elected by a plurality of the votes cast the Annual Meeting.
If you are a beneficial shareholder, your bank or broker is not permitted to vote your shares on this proposal if voting instruction are not received from you (this is commonly referred to as a “broker” non-vote”). Broker non-votes are not considered votes cast and, therefore, will not impact the election of the nominees.
ALL OTHER PROPOSALSPROPOSAL 2 - RATIFICATION OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED ACCOUNTING FIRM
The affirmative vote of a majority of the voting power of the shares of our common stock present in person or represented by proxy at the meeting and entitled to vote thereon is required to approve all other items.the ratification of Ernst & Young LLP as our independent registered accounting firm. Abstentions will be counted as present and entitled to vote on the proposalsproposal and will therefore have the effect of a negative vote. Wevote against this proposal. Since this is a “routine” matter (as described below), we do not expect there towill be any broker non-votes with respect to the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2021.2023.
PROPOSAL 3 - ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS
The affirmative vote of a majority of the voting power of the shares of our common stock present or represented by proxy at the meeting and entitled to vote thereon is required to approve, on a non-binding advisory basis, the compensation of our named executive officers as disclosed in this proxy statement (commonly known as a “say-on-pay” proposal). Abstentions will be counted as present and entitled to vote and therefore will have the same effect as a vote against this proposal. The say-on-pay proposal is not considered a “routine” matter, and therefore, if you are a beneficial (or “street name”) holder and your bank, broker or other nominee does not receive instructions from you, they may not vote your shares on your behalf (a broker non-vote). Broker non-votes are not considered entitled to vote on this proposal and, therefore, will have no effect on the approval of this proposal.
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Q: When will the results of the vote be announced?
The preliminary voting results will be announced at the Annual Meeting. The final voting results will be published in a Current Report on Form 8-K filed with the SEC within four business days of the Annual Meeting.
Q: What is the deadline for submitting a shareholder proposal or director nomination for the 20222024 Annual Meeting?
Shareholder proposals pursuant to SEC Rule 14a-8 for inclusion in Maravai’s proxy statement and form of proxy for the Maravai’s 2022 annual meeting of shareholders to be held in 2022,2024 must be received by MaravaiMaravai’s General Counsel and Secretary at our principal executive offices at 10770 Wateridge Circle Suite 200, San Diego, California 92121 no later than the close of business on December 10, 2021.21, 2023. Shareholders wishing to make a director nomination or bring a proposal before the annual meeting to be held in 20222024 (but not include it in Maravai’s proxy materials) must provide written notice of such proposal to the General Counsel and Secretary at Maravai’s principal executive offices no later than the close of business on February 18, 20222024 and not earlier than the close of business on
January 19, 2022,2024, assuming Maravai does not change the date of the 20222024 annual meeting of shareholders by more than 30 days before or after the anniversary of the 20212023 Annual Meeting. If so, Maravai will release an updated time frame for shareholder proposals. Any shareholder proposal or director nomination must comply with the other provisions of Maravai’s Amended and Restated Bylaws (“Bylaws”) and be submitted in writing to the Secretary at Maravai’s principal executive offices. In addition, to comply with the universal proxy rules, shareholders who intend to solicit proxies in support of director nominees, other than Maravai’s nominees, must also provide written notice that sets forth the information required by Rule 14a-19 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), no later than March 19, 2024.
Q: If I am a beneficial shareholder and hold my shares in “street name,” how will my shares be voted if I don’t provide voting instructions?
Current New York Stock Exchange rules allow brokers to vote shares on certain “routine” matters for which their customers do not provide voting instructions. If you are a beneficial shareholder and own shares in “street name” through a broker, bank, or other nominee, the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2023 (Proposal 2) is considered a “routine” matter on which your broker may use its discretion to vote your shares without your instructions. The election of directors (Proposal 1) and the advisory vote on executive compensation (Proposal 3) are not routine proposals; therefore, your broker will be unable to vote your shares on these proposals if you do not instruct your broker how to vote, which is referred to as a “broker non-vote.” Broker non-votes will have no effect on the outcome of the votes on the election of directors or the advisory vote on executive compensation.
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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
Board Structure and Composition
Our business and affairs are managed under the direction of ourthe Board, which is currently composed of nineeleven directors. Our certificate of incorporation (our “Certificate”) provides that the authorized number of directors may be changed only by resolution of ourthe Board. Our Certificate also provides that ourthe Board will be divided into three classes of directors, with the classes as nearly equal in number as possible. At each annual meeting of shareholders, a class of directors will be elected for a three-year term to succeed the class whose term is then expiring.
The following table sets forth the director class, name, age as of March 24, 2021,21, 2023, and other information for each member of ourthe Board:
Name | Class | Age | Position | Director Since | Current Term Expires | Expiration of Term For Which Nominated | Class | Age | Position | Director Since | Current Term Expires | Expiration of Term For Which Nominated | ||||||||||||||||||||
Anat Ashkenazi | III | 50 | Director | 2020 | 2023 | 2026 | ||||||||||||||||||||||||||
Gregory T. Lucier | III | 58 | Director | 2020 | 2023 | 2026 | ||||||||||||||||||||||||||
Luke Marker | III | 38 | Director | 2020 | 2023 | 2026 | ||||||||||||||||||||||||||
Benjamin Daverman | I | 43 | Director | 2020 | 2021 | 2024 | I | 45 | Director | 2020 | 2024 | |||||||||||||||||||||
Susannah Gray | I | 60 | Director | 2020 | 2021 | 2024 | I | 62 | Director | 2020 | 2024 | |||||||||||||||||||||
Carl Hull | I | 63 | Chief Executive Officer and Chair of the Board | 2020 | 2021 | 2024 | I | 65 | Interim Chief Executive Officer and Executive Chairman of the Board | 2020 | 2024 | |||||||||||||||||||||
Constantine Mihas | I | 54 | Director | 2020 | 2021 | 2024 | I | 56 | Director | 2020 | 2024 | |||||||||||||||||||||
Sean Cunningham | II | 45 | Director | 2020 | 2022 | II | 47 | Director | 2020 | 2025 | ||||||||||||||||||||||
Robert B. Hance | II | 61 | Director | 2020 | 2022 | II | 63 | Director | 2020 | 2025 | ||||||||||||||||||||||
Jessica Hopfield | II | 56 | Director | 2020 | 2022 | |||||||||||||||||||||||||||
Murali K. Prahalad | II | 49 | Director | 2020 | 2022 | |||||||||||||||||||||||||||
Anat Ashkenazi | III | 48 | Director | 2020 | 2023 | |||||||||||||||||||||||||||
Gregory T. Lucier | III | 56 | Director | 2020 | 2023 | |||||||||||||||||||||||||||
Luke Marker | III | 36 | Director | 2020 | 2023 | |||||||||||||||||||||||||||
Jessica Hopfield, Ph.D. | II | 58 | Director | 2020 | 2025 | |||||||||||||||||||||||||||
Murali K. Prahalad, Ph.D. | II | 51 | Director | 2020 | 2025 |
We believe that in order for ourthe Board to effectively guide us to long-term sustainable, dependable performance, it should be composed of individuals with sophistication and experience in the many disciplines that impact our business. In order to best serve our shareholders, we seek to have a Board, as a whole, that is competent in key corporate disciplines, including accounting and financial acumen, business judgment, crisis management, governance, leadership, people management, risk management, social responsibility and reputational issues, strategy and strategic planning. Additionally, we desire that the Board have specific knowledge related to our industry.
The CompensationNominating, Governance and NominatingRisk Committee believes that all directors must, at a minimum, meet the criteria set forth in the Board’sCompany’s Code of ConductEthics and theits Corporate Governance Guidelines, which specify, among other things, that the CompensationNominating, Governance and NominatingRisk Committee will consider criteria such as independence, diversity, age, skills, and experience in the context of the needs of the Board. In addressing issues of diversity in particular, the CompensationNominating, Governance and NominatingRisk Committee considers a nominee’s differences in gender, ethnicity, tenure, skills and qualifications. The CompensationNominating, Governance and NominatingRisk Committee believes that diversity of backgrounds and viewpoints is a key attribute for a director nominee. While we doit has not haveestablished a separate formal policy on diversity, when considering the selection of director nominees, the CompensationNominating, Governance and NominatingRisk Committee considers individuals with diverse backgrounds, viewpoints,
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accomplishments, cultural background and professional expertise, among other factors, that, when considered as a group, provide a sufficient mix of perspectives to allow the Board to best fulfill its responsibilities to the long-term interests of our shareholders. The CompensationNominating, Governance and NominatingRisk Committee also will consider a combination of factors for each director, including (a) the nominee’s ability to represent all stockholdersshareholders without a conflict of interest, (b) the nominee’s ability to work in and promote a productive environment, (c) whether the nominee has sufficient time and willingness to fulfill the substantial duties and responsibilities of a director, (d) whether the nominee has demonstrated the high level of character, ethics and integrity expected by the Company, (e) whether the nominee possesses the broad professional and leadership experience and skills necessary to effectively respond to the
complex issues encountered by a publicly-traded company, (f) the nominee’s ability to apply sound and independent business judgment and (g) the diverse attributes of the nominee, such as differences in background, qualifications and personal characteristics.
The CompensationNominating, Governance and NominatingRisk Committee has determined that all of our directors meet the criteria and qualifications set forth in the Company’s Code of Conduct for the Board of Directors, theEthics and its Corporate Governance Guidelines and the criteria set forth above for director nominees. Moreover, each director possesses the following critical personal qualities and attributes that we believe are essential for the proper functioning of the Board to allow it to fulfill its duties for our shareholders: accountability, ethical leadership, governance, integrity, risk management, and sound business judgment. In addition, our directors have the confidence to assess and challenge the way things are done and recommend alternative solutions, a keen awareness of our business and social realities of the environment in which we operate, the independence and high performancehigh-performance standards necessary to fulfill the Board’s oversight function, and the humility, professional maturity, and style to interface openly and constructively with other directors. Finally, the director biographies below include a non-exclusive list of other key experiences and qualifications that further qualify the individual to serve on the Board. These collective qualities, skills, experiences and attributes are essential to ourthe Board’s ability to exercise its oversight function for Maravai and its shareholders, and guide the long-term sustainable, dependable performance of Maravai.
Subject to any earlier resignation or removal in accordance with the terms of our Certificate, bylaws andBylaws or the Director Nomination Agreement (as defined and discussed below) with Maravai Life Sciences Holdings, LLC (“MLSH 1”), Maravai Life Sciences Holdings 2, LLC (“MLSH 2”), GTCR Fund XI/C LP, GTCR Fund XI/B LP, GTCR Co-Invest XI LP, GTCR Partners XI/A&C LP, GTCR Partners XI/B LP and GTCR Investment XI LLC (collectively, “GTCR”), our Class I directors will serve until this first Annual Meetingthe 2024 annual meeting of our shareholders, our Class II directors will serve until the second2025 annual meeting of our shareholders, and our Class III directors will be elected at this Annual Meeting to serve until the third2026 annual meeting of our shareholders. In addition, our Certificate provides that our directors may be removed with or without cause by the affirmative vote of at least a majority of the voting power of our outstanding shares of stock entitled to vote thereon, voting together as a single class for so long as GTCR beneficially owns 40% or more, in the aggregate, of the total number of shares of our common stock then outstanding (“Voting Stock”). If GTCR no longer beneficially owns in the aggregate (directly or indirectly) 40% or more of our Voting Stock, then our directors may be removed only for cause upon the affirmative vote of at least 66 2⁄3% of the voting power of our outstanding shares of stock entitled to vote thereon.
Director Nomination Agreement
In connection with our initial public offering (our “IPO”), we entered into a Director Nomination Agreementdirector nomination agreement (as further amended and restated, the “Director Nomination Agreement”) with GTCR. The Director Nomination Agreement provides GTCR the right to nominate to the Board a number of designees equal to at least: (i) 100% of the total number of directors comprising the Board, so long as GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 40% of the total amount of shares of Class A common stock and Class B common stock it ownsowned as of the date of the IPO, (ii) 40% of the total number of directors, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 30% but less than 40% of the total amount of shares of Class A common stock and Class B common stock it owned as of the date of the IPO, (iii) 30% of the total number of directors, in the event that
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GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 20% but less than 30% of the total amount of shares of Class A common stock and Class B common stock it owned as of the date of the IPO, (iv) 20% of the total number of directors, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 10% but less than 20% of the total amount of shares of Class A common stock and Class B common stock it owned as of the date of the IPO and (v) one director, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 5% of the total amount of shares of Class A common stock and Class B common stock it owned as of the date of the IPO. In each case, GTCR’s nominees must comply with applicable law and satisfy any applicable stock exchange rules. In addition, GTCR shall be entitled to designate the replacement for any of its
Board designees whose Board service terminates prior to the end of the director’s term, regardless of GTCR’s beneficial ownership at that time. GTCR shall also have the right to have its designees participate on committees of ourthe Board proportionate to its voting power, subject to compliance with applicable law and stock exchange rules.rules regarding the independence of such committees. The Director Nomination Agreement also prohibits us from increasing or decreasing the size of ourthe Board without the prior written consent of GTCR. This agreementThe Director Nomination Agreement will automatically terminate at such time as GTCR beneficially owns less than 5% of the shares of Class A and Class B common stock it beneficially ownsowned as of the date of the IPO.
The members of the Board nominated by GTCR pursuant to the Director Nomination Agreement are Sean Cunningham, Benjamin Daverman, Luke Marker and Constantine Mihas.
Shareholder Recommendations for Director Nominees
The CompensationSubject to the rights of GTCR under the Director Nomination Agreement, the Nominating, Governance and NominatingRisk Committee will consider shareholder nominationsevaluate candidates for director recommended by our shareholders using the same criteria and process outlined in our Corporate Governance Guidelines. Shareholders who wish to identify director candidates for consideration by the Nominating and Corporate Governance Committee may write to 10770 Wateridge Circle Suite 200, San Diego, California 92121, Attn: General Counsel and Secretary, and any candidates so identified will be forwarded to the Chairman of the Nominating, Governance and Risk Committee for consideration.
Shareholders may also nominate directors for membership on the Board. For the 2022 Annual Meeting,annual meeting of our shareholders to be held in 2024, nominations may be submitted to 10770 Wateridge Circle Suite 200, San Diego, California 92121, Attn: General Counsel and Secretary, and such nominations will then be forwarded to the Chair of the CompensationNominating, Governance and NominatingRisk Committee. Recommendations must be in writing and we must receive the recommendation no later than the close of business on February 18, 20222024 and not earlier than the close of business on January 19, 2022.2024. Recommendations must also include certain other procedural requirements as specified in our bylaws.Bylaws. In addition, to comply with the universal proxy rules, shareholders who intend to solicit proxies in support of director nominees, other than the Company’s nominees, must also provide written notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than March 19, 2024.
When filling a vacancy on the Board, the CompensationNominating, Governance and NominatingRisk Committee identifies the desired skills and experience of a new director and nominates individuals who it believes can strengthen the Board’s capabilities and further diversify the collective experience represented by the then-current directors. The CompensationNominating, Governance and NominatingRisk Committee may engage third parties to assist in the search and provide recommendations. Also, directors are generally asked to recommend candidates for the position. The candidates are then evaluated based on the process outlined in our Corporate Governance Guidelines and the CompensationNominating, Governance and NominatingRisk Committee charter, and the same process is used for all candidates, including candidates recommended by shareholders.
PROPOSAL 1—1 - ELECTION OF DIRECTORS
OurBased upon the recommendation of the Nominating, Governance and Risk Committee, the Board recommends that the nominees below be elected as members of the Board at the Annual Meeting.
Name | Class | Age | Position | Director Since | Current Term Expires | Expiration of Term For Which Nominated | ||||||
Benjamin Daverman | I | 43 | Director | 2020 | 2021 | 2024 | ||||||
Susannah Gray | I | 60 | Director | 2020 | 2021 | 2024 | ||||||
Carl Hull | I | 63 | Chief Executive Officer and Chair of the Board | 2020 | 2021 | 2024 | ||||||
Constantine Mihas | I | 54 | Director | 2020 | 2021 | 2024 |
Name | Class | Age* | Position | Director Since | Current Term Expires | Expiration of Term For Which Nominated | ||||||||||||||||||
Anat Ashkenazi | III | 50 | Director | 2020 | 2023 | 2026 | ||||||||||||||||||
Gregory T. Lucier | III | 58 | Director | 2020 | 2023 | 2026 | ||||||||||||||||||
Luke Marker | III | 38 | Director | 2020 | 2023 | 2026 |
* | Age as of March 21, 2023. |
Each nominee was included in the slate of nominees recommended for re-election by pursuant to the Compensationterms of the Director Nomination Agreement. Each nominee has consented to stand for re-election and Nominating Committee for consideration byhas agreed to serve if elected. We currently have no reason to believe that any of the Board and our shareholders. If,nominees would be unable or unwilling to serve if elected. However, if before the Annual Meeting, any nominee becomes unable to serve, or chooses not to serve, the Board may nominate a substitute. If that happens, the persons named as proxies on the proxy card will vote for the substitute. Alternatively, the Board may either let the vacancy stay unfilled until an appropriate candidate is identified or reduce the size of the Board to eliminate the unfilled seat.vacancy.
The Board Recommends that you vote “FOR” each of the director nominees.nominees.
Proxies solicited on behalf of the Board will be voted “FOR” the re-election of each of the three nominees, unless your proxy card is marked otherwise (if you are a registered shareholder) or you have provided a different instruction to your bank or broker (if you are a beneficial or “street name” shareholder).
Director Nominees to Serve for a Three-Year Term Expiring at the 20242026 Annual Meeting.Meeting.
Benjamin DavermanAnat Ashkenazi has served on ourthe Board and its Audit Committee since our IPO in November 2020, and as Chair of the Board’s Compensation and Leadership Development Committee since October 2022. Ms. Ashkenazi is currently the Chief Financial Officer of Eli Lilly and Company, a pharmaceutical company, where she has worked for over 20 years. Ms. Ashkenazi joined Eli Lilly in 2001 and has had a diverse career spanning financial, strategy and operations roles. Prior to her current position, Ms. Ashkenazi held roles as the Senior Vice President of Finance of Eli Lilly and as chief financial officer for a number of global divisions within Eli Lilly, including Oncology, Diabetes, Global Manufacturing & Quality and Research & Development. Ms. Ashkenazi holds an MBA from Tel Aviv University and a BA in Economics & Business Administration from the Hebrew University. We determined that Ms. Ashkenazi’s extensive executive experience in the pharmaceutical industry, as well as her financial expertise, qualify her to serve as a director on the Board of Directors.
Gregory T. Lucier has served on the Board since our IPO in November 2020 and has served as a member of MLSH 1’s board since January 2020. Mr. Lucier, a 25-year veteran of the healthcare industry, served as the Chief Executive Officer of Corza Health, Inc. (“Corza Health”), a life sciences company, from April 2019 until January 2021, and has served as Corza Health’s Executive Chairman since February 2021. Prior to Corza Health, Mr. Lucier was Chief Executive Officer of NuVasive, Inc. (“NuVasive”) from June 2015 to November 2018, and served as Chairman of the Board for NuVasive from March 2015 until May 2021. NuVasive is an innovative medical device company specializing in minimally invasive spine surgery. Prior to NuVasive, from 2003 to 2014, Mr. Lucier served as Chair and CEO of Life Technologies, Inc. (“Life Technologies”). Mr. Lucier’s early career included roles as a corporate officer of General Electric Company and as an executive at GE Medical Systems Information Technologies, Inc., a healthcare company. Mr. Lucier serves as a director of Catalent, a global pharmaceutical products manufacturer, Dentsply Sirona Inc., a global provider of professional dental products and technologies, and PhenomeX Inc. (formerly Berkeley Lights), a life sciences company (“PhenomeX”). He has an MBA from Harvard Business School and a BA in Industrial Engineering from
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Pennsylvania State University. We determined Mr. Lucier’s extensive experience in the healthcare and medical device industry, in addition to his experience on multiple public and private boards of directors, qualify him to serve as a director on the Board of Directors.
Luke Marker has served on the Board since our IPO in November 2020 and has served as a member of MLSH 1’s board since 2016. Mr. Marker joined GTCR in 2009 where he is currently a Managing Director. Prior to joining GTCR, he worked in the investment banking division at Lehman Brothers and Barclays Capital. Mr. Marker holds an MBA with distinction from Harvard Business School and a BA in Mathematics and Economics from Kalamazoo College. We determined that Mr. Marker’s directorship experience with similar companies and extensive experience in the healthcare, pharmaceutical and life sciences industries qualify him to serve as a director on the Board of Directors.
Continuing Directors
Carl Hull served as our Chief Executive Officer since he co-founded Maravai from March 2014 until September 2022, when his successor, William E. Martin, III, was appointed as CEO. Mr. Hull was appointed interim CEO in October 2022 when Mr. Martin was placed on a paid leave of absence (see the section entitled “Executive Officers” for information regarding the circumstances of Mr. Hull’s interim appointment), with Mr. Hull continuing to serve as Executive Chairman of the Board. Mr. Hull has served on the Board since November 2020 and has served as a member of MLSH 1’s board since March 2016. Mr. Hull brings 40 years of sales, marketing and general management experience in the diagnostics and life sciences industries. From 2009 to 2012, Mr. Hull was Chief Executive Officer of Gen-Probe Incorporated (“Gen-Probe”), a medical diagnostics company, and served as its Chief Operating Officer from 2007 to 2009. Under Mr. Hull’s leadership, Gen-Probe took full advantage of its core molecular diagnostics and automation strengths and launched several highly innovative products including the PANTHER® molecular diagnostic system and APTIMA® HPV screening assay. During Mr. Hull’s tenure, Gen-Probe extended its recognized leadership position in the most rapidly growing diagnostics market segment and the market capitalization of Gen-Probe doubled, creating nearly $2 billion in value for shareholders and culminating in a successful sale to Hologic, Inc. (“Hologic”) in 2012. Prior to Gen-Probe, Mr. Hull had been in sales, marketing and management positions for Abbott Laboratories, Ventana Medical Systems, Inc. (acquired by Roche Holding AG), Applied Imaging Corp. (now part of Danaher Corporation) and Applied Biosystems Inc. (now part of Thermo Fisher Scientific Inc. (“Thermo Fisher”)), all biomedical technology companies. Mr. Hull holds an MBA from the University of Chicago and a BA in Political Science and International Relations from the Johns Hopkins University. Mr. Hull is a valuable member of the Board due to his experience as our Chief Executive Officer, his executive experience at other biomedical technology companies and his experience as an executive at a publicly traded company.
Sean Cunningham has served on the Board since our IPO in November 2020 and on our Nominating, Governance and Risk Committee since October 2022, and has served as a member of MLSH 1’s board since March 2016. He also serves as a director on the Board of Directors of Sotera Health Company. Mr. Cunningham joined GTCR in 2001 where he is currently a Managing Director and Co-Head of the Healthcare Group. He was previously a consultant with The Boston Consulting Group. Mr. Cunningham holds an MBA from the Wharton School at the University of Pennsylvania as well as a BA and BE in Engineering Sciences from Dartmouth College. We determined that Mr. Cunningham’s directorship experience with similar companies and extensive experience in the healthcare and pharmaceutical industries qualify him to serve as a director on the Board of Directors.
Benjamin Daverman has served on the Board since our IPO in November 2020 and has served as a member MLSH 1’s board since March 2016. Previously, Mr. Daverman served on the Board’s Compensation and Nominating Committee from our IPO in November 2020 until October 2022. Mr. Daverman joined GTCR in 2008 where he is currently a Managing Director.Director and Co-Head of the Healthcare Group. Prior to joining GTCR, he worked as a Venture Capitalist at Alta Partners, a venture capital firm, as well as an Investment Banking
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Associate at JMP Securities and an Analyst in the mergers and acquisitions group at J.P. Morgan (formerly Hambrecht & Quist), both investment banking firms. Mr. Daverman holds an MBA from the Wharton School at the University of Pennsylvania and a BA in History from Colgate University. He also holds an MS in Biotechnology from the School of Engineering and Applied Science at the University of Pennsylvania. We determined that Mr. Daverman’s extensive directorship experience with similar companies, and extensive experience in the healthcare, pharmaceutical and life sciences qualifiesqualify him to serve as a director on the Board of Directors.
Susannah Gray has served on ourthe Board and as the Chair of its Audit Committee since our IPO in November 2020.2020 and has served on the Board’s Compensation and Leadership Development Committee since October 2022. She also serves as a director on the Board of Directors of 4D Molecular Therapeutics and Morphic Therapeutic, both biotech companies. Ms. Gray served as the Chief Financial Officer of Royalty Pharma Management LLC (“Royalty Pharma”), a buyer of pharmaceutical royalties, from January 2005 to December 2018. She was promoted to Executive Vice President of Finance and Strategy in December 2018 and retired from Royalty Pharma in September 2019. Prior to Royalty Pharma, Ms. Gray served as a managing director and senior analyst covering the healthcare sector of CIBC World Markets’ high yield group from 2002 to 2004, and also previously served in similar roles at Merrill Lynch and Chase Securities (predecessor of J.P. Morgan Securities). Ms. Gray holds an MBA from Columbia University and a BA in Social Studies from Wesleyan University. We determined that Ms. Gray’s extensive executive experience in the pharmaceutical industry, as well as her financial expertise, qualifiesqualify her to serve as a director on the Board of Directors.
Carl Hull has served as our Chief Executive Officer since he co-founded Maravai in March 2014. Mr. HullRobert B. Hance has served on our Board since November 2020 and has served as a member of MLSH 1’s board since March 2016. Mr. Hull brings over 35 years of sales, marketing and general management leadership in the diagnostics and life sciences industries. From 2009 to 2012, Mr. Hull was Chief Executive Officer of Gen-Probe Incorporated (“Gen-Probe”), a medical diagnostics company, and served as its Chief Operating Officer from 2007 to 2009. Under Mr. Hull’s leadership, Gen-Probe took full advantage of its core molecular diagnostics and
automation strengths and launched several highly innovative products including the PANTHER® molecular diagnostic system and APTIMA® HPV screening assay. During Mr. Hull’s tenure, Gen-Probe extended its recognized leadership position in the most rapidly growing diagnostics market segment and the market capitalization of Gen-Probe doubled, creating nearly $2 billion in value for shareholders and culminating in a successful sale to Hologic, Inc. (“Hologic”) in 2012. Prior to Gen-Probe, Mr. Hull had been in sales, marketing and management positions for Abbott Laboratories, Ventana Medical Systems, Inc. (acquired by Roche Holding AG), Applied Imaging Corp. (now part of Danaher Corporation) and Applied Biosystems Inc. (now part of Thermo Fisher Scientific Inc. (“Thermo Fisher”)), all biomedical technology companies. Mr. Hull serves as Chair of the Board for The Binding Site and is a member of the Board of Ortho Clinical Diagnostics, both leading human diagnostics companies. Mr. Hull holds an MBA from the University of Chicago and a BA in Political Science and International Relations from the Johns Hopkins University. Mr. Hull is a valuable member of our Board due to his experience as our Chief Executive Officer, his executive experience at other biomedical technology companies and his experience as an executive at a publicly-traded company.
Constantine Mihas has served on our Board and as Chair of its Compensation and Nominating Committee since our initial public offering in November 2020 and has served as a member MLSH 1’s board since March 2016. Mr. Mihas joined GTCR in 2001 where he is currently a Managing Director and head of the Healthcare group. Prior to joining GTCR, Mr. Mihas was Chief Executive Officer and co-founder of Delray Farms, LLC (“Delray Farms”), a specialty food retailer. Prior to Delray Farms, Mr. Mihas was with McKinsey & Company, Inc., a consulting firm. Mr. Mihas holds an MBA with distinction from the Harvard Business School and a BS in Finance and Economics from the University of Illinois, Chicago We determined that Mr. Mihas’s directorship experience with similar companies, deep business background, and extensive experience in the healthcare, pharmaceutical and life sciences industries qualifies him to serve as a director on the Board of Directors.
Continuing Directors
Anat Ashkenazi has served on our Board and its Audit Committee since our IPO in November 2020. Ms. Ashkenazi is the Chief Financial Officer of Eli Lilly and Company, where she has worked for over nineteen years. Ms. Ashkenazi joined Eli Lilly in 2001 and has had a diverse career spanning financial, strategy and operations roles. Prior to her current position, Ms. Ashkenazi held roles as the Senior Vice President of Finance of Eli Lilly and as chief financial officer for a number of global divisions within Eli Lilly, including Oncology, Diabetes, Global Manufacturing & Quality and Research & Development. Ms. Ashkenazi holds an MBA from Tel Aviv University and a BA in Economics & Business Administration from the Hebrew University. We determined that Ms. Ashkenazi’s extensive executive experience in the pharmaceutical industry, as well as her financial expertise, qualifies her to serve as a director on the Board of Directors.
Sean Cunningham has served on our Board since our IPO in November 2020 and has served as a member of MLSH 1’s board since March 2016. Mr. Cunningham joined GTCR in 2001 where he is currently a Managing Director. He was previously a consultant with The Boston Consulting Group. Mr. Cunningham holds an MBA from the Wharton School at the University of Pennsylvania as well as a BA and BE in Engineering sciences from Dartmouth College. We determined that Mr. Cunningham’s directorship experience with similar companies and extensive experience in the healthcare and pharmaceutical industries qualifies him to serve as a director on the Board of Directors.
Robert B. Hance has served on our Board since our IPO in November 2020 and has served as a member of MLSH 1’s board since 2017. Mr. Hance is a medical device industry veteran with more than 2530 years’ experience and has served as the Chief Executive Officer of Regatta Medical, Inc. (“Regatta Medical”), a medical device company, since 2017. Prior to Regatta Medical from 2013 to 2016, Mr. Hance was Chief Executive Officer of Creganna Medical Devices, Inc. (“Creganna Medical”), a leading supplier to the minimally invasive medical device industry. Creganna Medical was sold to TE Connectivity Ltd. in 2016. From 2012 to 2013, Mr. Hance was an Entrepreneur-in-Residence within the FDA at the Center for Devices and Radiological Health. Prior to his FDA experience, Mr. Hance was President of Abbott Vascular, the cardiovascular device
division of Abbott Laboratories, a biomedical company. Mr. Hance holds an MBA from Harvard Business School and a BS in Chemical Engineering from the Massachusetts Institute of Technology. We determined Mr. Hance’s extensive expertise in the medical device and life sciences industry qualifiesqualify him to serve as a director on the Board of Directors.
Jessica Hopfield, PhDPh.D. has served on ourthe Board and its Audit Committee and Compensation and Nominating Committee since our IPO in November 2020.2020, and as Chair of the Board’s Nominating, Governance and Risk Committee since October 2022. Previously, Dr. Hopfield served on the Board’s Compensation and Nominating Committee from our IPO in November 2020 until October 2022. Dr. Hopfield is a scientist and business leader with more than two decades of experience in the medical and healthcare fields. She serves as an independent director on the Board of Directors of Insulet Corporation, a medical device company, PhenomeX (formerly Berkeley Lights), a life sciences company, and Editas Medicine.Medicine, a biotechnology company. In addition, she is a strategic advisor and investor in start-up healthcare firms. Dr. Hopfield is a former Partner of McKinsey & Company, a global management consulting firm, in its global pharmaceuticals and medical devices practice where she led work in strategy, research and development management, and marketing across pharmaceutical, biotechnology and medical device industries. She also held management positions at Merck Sharp & Dohme Corp., a pharmaceutical company, in clinical development, outcomes research, and marketing. Dr. Hopfield holds a PhDPh.D. in Biological Sciences from The Rockefeller University, an MBA from Harvard Business School and a BS in Biology from Yale College. We determined that Dr. Hopfield is qualified to serve as a member of ourthe Board because of her extensive experience in the life sciences industry, educational background and service as an independent director to other public companies.
Gregory T. LucierConstantine Mihas has served on ourthe Board since our IPO in November 2020 and our Compensation and Leadership Development Committee since October 2022 and has served as a member MLSH 1’s board since
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March 2016. Previously, Mr. Mihas served as Chair of the Board’s Compensation and Nominating Committee from our IPO in November 2020 until October 2022. He also serves as a director on the Board of Directors of Sotera Health Company. Mr. Mihas joined GTCR in 2001 where he is currently Co-CEO and Managing Director. Prior to joining GTCR, Mr. Mihas was Chief Executive Officer and co-founder of Delray Farms, LLC (“Delray Farms”), a specialty food retailer. Prior to Delray Farms, Mr. Mihas was with McKinsey & Company, Inc., a consulting firm. Mr. Mihas holds an MBA with distinction from the Harvard Business School and a BS in Finance and Economics from the University of Illinois, Chicago. We determined that Mr. Mihas’s directorship experience with similar companies, deep business background, and extensive experience in the healthcare, pharmaceutical and life sciences industries qualify him to serve as a director on the Board of Directors.
Murali K. Prahalad, Ph.D. has served on the Board since our IPO in November 2020 and our Nominating, Governance and Risk Committee since October 2022, and has served as a member of MLSH 1’s board since January 2020. Mr. Lucier has served as the Chief Executive Officer of Corza Health, Inc. (“Corza Health”), a life sciences company, since 2018 and is a 25-year veteran of the healthcare industry. Prior to Corza Health, Mr. Lucier was Chair and Chief Executive Officer of NuVasive, Inc. (“NuVasive”) from 2015 to 2018. NuVasive is an innovative medical device company specializing in minimally invasive spine surgery. Prior to NuVasive, from 2003 to 2014, Mr. Lucier served as Chair and CEO of Life Technologies, Inc. (“Life Technologies”). Mr. Lucier’s early career included roles as a corporate officer of General Electric Company and as an executive at GE Medical Systems Information Technologies, Inc., a healthcare company. Mr. Lucier serves as a director of Catalent, a global pharmaceutical products manufacturer, Dentsply Sirona Inc., a global provider of professional dental products and technologies, and Berkeley Lights, a life sciences company. He has an MBA from Harvard Business School and a BA in Industrial Engineering from Pennsylvania State University. We determined Mr. Lucier’s extensive experience in the healthcare and medical device industry, in addition to his experience on multiple public and private boards of directors, qualifies him to serve as a director on the Board of Directors.
Luke Marker has served on our Board since our IPO in November 2020 and has served as a member of MLSH 1’s board since 2016. Mr. Marker joined GTCR in 2009 where he is currently a Principal. Prior to joining GTCR, he worked in the investment banking division at Lehman Brothers and Barclays Capital. Mr. Marker holds an MBA with distinction from Harvard Business School and a BA in Mathematics and Economics from Kalamazoo College. We determined that Mr. Marker’s directorship experience with similar companies and extensive experience in the healthcare, pharmaceutical and life sciences industries qualifies him to serve as a director on the Board of Directors.
Murali K. Prahalad has served on our Board since our IPO in November 2020 and has served as a member MLSH 1’s board since August 2016. Dr. Prahalad is currentlyhas been the President and Chief Executive Officer of Iridia, Inc., a nanotechnology company, since November 2019 and was most recently the President and Chief Executive Officer of Epic Sciences, Inc., a medical diagnostics company, from August 2013 through April 2019. Dr. Prahalad has two decades of experience in the technology and life science industries. From 2007 through 2013, Dr. Prahalad served in multiple roles at Life Technologies, a biotechnology company, including as Vice President of Corporate Strategy. Before Life Technologies, Dr. Prahalad was Vice President of Business Development at Sequenom, Inc., a biotechnology company. Dr. Prahalad received a PhDPh.D. in biochemistry and molecular pharmacology as well as an MS in medical sciences from Harvard University. He also holds a BS in Cellular and Molecular Biology and Economics from the University of Michigan. We determined Dr. Prahalad’s extensive experience in the technology and life sciences industry, in addition to his medical expertise and experience on boards of directors, qualifiesqualify him to serve as a director on the Board of Directors.
Board Diversity Matrix
Board Diversity Matrix (as of March 21, 2023) | ||||||||||||||||
Total Number of Directors | 11 | |||||||||||||||
Female | Male | Non-Binary | Did Not Disclose Gender | |||||||||||||
Part I: Gender Identity |
| |||||||||||||||
Directors | 3 | 8 | — | — | ||||||||||||
Part II: Demographic Background |
| |||||||||||||||
African American or Black | — | — | — | — | ||||||||||||
Alaskan Native or Native American | — | — | — | — | ||||||||||||
Asian | — | 1 | — | — | ||||||||||||
Hispanic or Latinx | — | — | — | — | ||||||||||||
Native Hawaiian or Pacific Islander | — | — | — | — | ||||||||||||
White | 3 | 7 | — | — | ||||||||||||
Two or More Races or Ethnicities | — | — | — | — | ||||||||||||
LGBTQ+ | — | |||||||||||||||
Did Not Disclose Demographic Background | — | |||||||||||||||
Part III: Supplemental Self-Identification | ||||||||||||||||
Military Veteran | — | — | — | — | ||||||||||||
Person with Disability/Disabilities | — | — | — | — | ||||||||||||
Middle Eastern | 1 | — | — | — | ||||||||||||
North African | — | — | — | — |
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Independence Status
The listing standards of the Nasdaq Global Select Market (“Nasdaq”) require that, subject to specified exceptions, such as those described below under the subsection entitled, “Controlled Company Status”,Status,” a majority of the members of the board of directors and each member of a listed company’s Audit Committeeaudit committee, compensation committee and Compensation and Nominating Committeenominations committee be independent and that Audit Committeeaudit committee members and compensation committee members also satisfy independence criteria set forth in Rule 10A-3 under the Exchange Act.Act and the Nasdaq’s listing standards, respectively.
OurThe Board has determined that none of the following directors (nor any of his or her family members) has a relationship with the Company which, in its opinion, would interfere with his or her exercise of independent judgment in carrying out the responsibility of a director of the Company, and therefore, each of Messrs. Hance and Lucier, Ms. Ashkenazi, Ms. Gray and Drs. Hopfield and Prahalad meetqualify as independent directors in accordance with Nasdaq’s listing standards. In addition, the Board has determined that each of Susannah Gray, Anat Ashkenazi, and Jessica Hopfield, Ph.D. meets the heightened independence requirements to be independent directors.for audit committee membership as set forth in Rule 10A-3 under the Exchange Act. In making this determination, ourthese determinations, the Board considered the relationships (if any) that each non-employee director (and any of his or her family members) has with the Company and all other facts and circumstances that ourthe Board deemed relevant in determining his or her independence, including beneficial ownership of our common stock.
Controlled Company Status
GTCR controls a majority of our outstanding common stock. As a result, we are a “controlled company”.company.” Under Nasdaq rules, a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain Nasdaq corporate governance requirements,rules, including the requirements that, within one year of the date of the listing of our common stock:
1. | we have a board that is composed of a majority of “independent directors”, as defined under |
2. | we have a compensation committee that is composed entirely of independent directors; and |
3. | we have a |
WeFrom time to time, we may rely on this exemption. As a result, we may not haveAlthough a majority of the Board is currently composed of independent directors, on our Board. In addition,neither our Compensation and Leadership Development Committee, nor the Nominating, Governance and Risk Committee, may not consistconsists entirely of independent directors or be subject to annual performance evaluations.directors. Accordingly, you may not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements.
Board Meetings and Committees
We closed our initial public offering in November 2020. Our Board was comprised of one director until our initial public offering, so forIn 2022, the year ended December 31, 2020, our Board held only one regular meeting.six meetings. Our Audit Committee which was established in connection with the November 2020 IPO, met once during 2020held eight meetings, and our previously constituted Compensation and Nominating Committee which was also establishedheld five meetings prior to the Board separating its duties and responsibilities into two separate committees, the Compensation and Leadership Development Committee and the Nominating, Governance and Risk Committee, in connection with the November 2020 IPO, did not meet during 2020.October 2022. Our Compensation and Leadership Development Committee held two meetings, and our Nominating, Governance and Risk Committee held one meeting in 2022. Directors are expected to attend the annual meeting of shareholders and all or substantially all of the Board meetings and meetings of committees on which they serve. In 2020,2022, each director other than Mr. Cunningham attended at least 75% of the meetings of the Board during such director’s tenure and the total number of meetings held by any of the committees of the Board on which the director served. Six of our then-serving directors attended the 2022 annual meeting of our shareholders.
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OurThe Board has an Audit Committee, and a Compensation and Leadership Development Committee and a Nominating, Governance and Risk Committee. The composition, duties and responsibilities of these committees are as set forth below. In the future, ourthe Board may establish other committees, as it deems appropriate, to assist it with its responsibilities.
Board Member | Audit Committee | Compensation and Leadership Development Committee | Nominating, Governance and Risk Committee | |||
Carl Hull | ||||||
Anat Ashkenazi | X | X(Chair) | ||||
Sean Cunningham | X | |||||
Benjamin Daverman | ||||||
Susannah Gray | X(Chair) | X | ||||
Robert B. Hance | ||||||
Jessica Hopfield, Ph.D. | X | X(Chair) | ||||
Gregory T. Lucier | ||||||
Luke Marker | ||||||
Constantine Mihas | ||||||
Murali K. Prahalad, Ph.D. | X |
Audit Committee
The Audit Committee is responsible for, among other matters:
1. | appointing, approving the compensation of, and assessing the qualifications, performance and independence of our independent registered public accounting firm; |
2. | pre-approving audit and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm; |
3. | discussing on a periodic basis, or as appropriate, with management, our policies, programs and controls with respect to risk assessment and risk management; |
4. | reviewing and discussing with management and the independent registered public accounting firm our annual and quarterly consolidated financial statements and related disclosures as well as critical accounting policies and practices used by us; |
5. | reviewing our management’s discussion and analysis of financial condition and results of operations to be included in our annual and quarterly reports to be filed with the SEC; |
6. | monitoring the rotation of partners of the independent registered public accounting firm on our engagement team in accordance with requirements established by the SEC; |
7. | reviewing management’s report on its assessment of the effectiveness of internal control over financial reporting and any changes thereto; |
8. | reviewing the adequacy of our internal control over financial |
9. | establishing policies and procedures for the receipt and retention, follow-up and resolution of accounting, internal accounting controls or auditing matters, complaints and concerns; |
10. | recommending, based upon the Audit Committee’s review and discussions with management and the independent registered public accounting firm, whether our audited consolidated financial statements shall be included in our Annual Report on Form 10-K; |
11. | monitoring our compliance with legal and regulatory requirements as they relate to our consolidated financial statements and accounting matters; |
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12. | preparing the Audit Committee report required by the rules of the SEC to be included in our annual proxy statement; |
13. |
|
investigating any matters received, and reports to the Board periodically, with respect to ethics issues, complaints and associated investigations; |
reviewing the |
|
reviewing and overseeing all related party transactions for potential conflict of interest situations and approving all such transactions; and |
reviewing and discussing with management our earnings releases and scripts. |
OurThe Board has affirmatively determined that each of Dr. Hopfield, Ms. Gray and Ms. Ashkenazi meetmeets the definition of “independent director” for purposes of serving on an Audit Committee under Rule 10A-3 of the Exchange Act and the applicable Nasdaq listing standardsstandards. In addition, ourthe Board has determined that each of Ms. Gray and Ms. Ashkenazi qualifyqualifies as an “audit committee financial experts”expert” as such term is defined in Item 407(d)(5) of Regulation S-K.
The written charter for our Audit Committee is available at our corporate website at investors.maravai.com. Our website is not part of, nor incorporated by reference into, this notice and proxy statement.
Compensation and NominatingLeadership Development Committee
The Compensation and NominatingLeadership Development Committee is responsible for, among other matters:
1. | annually reviewing and approving corporate goals and objectives relevant to the compensation of our chief executive |
2. | evaluating the performance of our chief executive officer and other executive officers in light of such corporate goals and |
3. | recommending for approval to the Board the amount and form of chief executive officer compensation, taking into account the Board’s annual performance evaluation of the chief executive officer, peer group and other factors deemed most relevant, including the results of the most recent Say on Pay Vote (once available); |
4. | reviewing and approving the compensation of our other executive officers; |
appointing, compensating and overseeing the work of any compensation consultant, legal counsel or other advisor retained by the compensation committee; |
conducting the independence assessment outlined in Nasdaq rules with respect to any compensation consultant, legal counsel or other advisor retained by the compensation committee; |
annually reviewing and reassessing the adequacy of the committee charter in its compliance with the listing requirements of the Nasdaq; |
reviewing and establishing our overall management compensation and benefits, philosophy and policy; |
overseeing and administering our compensation and similar plans; |
reviewing and making recommendations to |
reviewing and determining stock ownership guidelines for our chief executive officer and other executive officers, and monitoring compliance with such guidelines; |
12. | reviewing and making recommendations to the Board with respect to the frequency of with which the Company will conduct Say-on-Pay votes; |
13. | reviewing and discussing with management the compensation discussion and analysis to be included in our annual proxy statement or Annual Report on Form 10-K; |
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15. | reviewing and |
The Board has adopted a written charter for the Compensation and NominatingLeadership Development Committee, which is available on our corporate website at investors.maravai.com. Our website is not part of, nor is it incorporated by reference into, this noticeproxy statement.
Nominating, Governance and Risk Committee
The Nominating, Governance and Risk Committee is responsible for, among other matters:
1. | developing and recommending to the Board criteria for board and committee membership; |
2. | subject to the rights of GTCR under the Director Nomination Agreement, identifying, recruiting, screening and recommending to the Board the persons to be nominated for election as directors and to each of the Board’s committees; |
3. | developing and recommending to the Board best practices and corporate governance principles; |
4. | developing and recommending to the Board a set of corporate governance guidelines; |
5. | reviewing and recommending to the Board the size, structure, responsibilities and compositions of the committees of the Board; |
6. | overseeing our sustainability and environmental, social and governance (including climate change) (“ESG”) risk management, strategy, initiatives and policies; |
7. | reviewing and discussing with management any ESG disclosures to be included in our annual proxy statement, Annual Report on Form 10-K or Quarterly Reports on Form 10-Q, if any; |
8. | reviewing our approach to risk tolerance and recommending to the Board any changes thereto; |
9. | reviewing our major risk exposures and steps taken to mitigate any such exposures; |
10. | overseeing our risk management policies and procedures; |
11. | receiving and reviewing significant actual or “near-miss” incidents related to relevant risks; and |
12. | reviewing and discussing with management any risk-related disclosures to be included in our Annual Report on Form 10-K or Quarterly Reports on Form 10-Q, if any. |
The Board has adopted a written charter for the Nominating, Governance and Risk Committee, which is available on our corporate website at investors.maravai.com. Our website is not part of, nor is it incorporated by reference into, this proxy statement.
Board Leadership Structure
The following section describes our Board leadership structure,believes that the reasons why the structure is in place at this time, the roles of various positions, and related key governance practices. The mix of experienced independent directors, as well as the GTCR-affiliated directors and management directorsour Executive Chairman, that make up ourcurrently comprise the Board, alongtogether with the role of our Chairstructure and composition of the Board committees, provides strong overall risk oversight and our Board committee composition, benefitsstrategic direction for the Company, benefitting Maravai and all of its shareholders.
Independence; Board Mix
OurThe Board has an effective mix of independent and management directors. OurThe Board includes six independent directors, our Interim Chief Executive Officer and Executive Chairman, Carl Hull, and four representatives from our majoritycontrolling shareholder, GTCR.
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Chair of the Board/Board and CEO
With respect to the roles of ChairChairman of the Board and CEO, the corporate governance guidelinesChief Executive Officer (“CEO”), our Corporate Governance Guidelines provide that the roles may be at times separated or at times combined, andgiving the Board will exercise its discretion in combining or separating these positions as it deems appropriate in light of prevailing circumstances.
Mr. Hull has beenserved as our ChairCEO and Chairman of the Board until September 30, 2022, at which time he was appointed Executive Chairman and the roles of CEO since our IPO.and Chairman were separated. On October 18, 2022, Mr. Hull was appointed Interim CEO, in addition to retaining leadership of the Board as Executive Chairman. The Board believes that combining the roles of Chair of the Board and CEO is currently the most effectivethis current leadership structure becauseis appropriate based on Mr. Hull hasHull’s extensive knowledge and experience in a variety of areas that are strategically relevant areasto the Company and which he acquired through his professional and other experiences. This knowledge and experience give Mr. Hull the insight necessary to combineeffectively lead the responsibilities ofBoard’s strategic development and execution along with managementrisk oversight of day-to-day operations.
Self-Evaluation
Our Compensation and Nominating Committee was established at the time of our IPO in November 2020. Going forward, our Compensation and Nominating Committee will conduct an annual performance evaluation to determine whether the Board, its committees, and the directors are functioning effectively. We expect that this will include survey materialsCompany, as well as individual conversations between each directoroversee the day-to-day leadership and the Chairperformance of the Board. Company, including management’s execution of its operating plans.
Management Succession
The evaluation will focusCompensation and Leadership Development Committee reviews and approves corporate goals and objectives relevant to CEO compensation and evaluates the CEO’s performance in light of these goals and objectives. The Compensation and Leadership Development Committee recommends to the Board the CEO’s compensation level or changes to such level based on the Board’sevaluation of the CEO’s performance and any other factors the committees’ contributionsCommittee deems relevant. The Compensation and Leadership Development Committee makes a report to Maravai, with an enhanced focus on areas in which the Board or management believes thaton succession planning at least once a year. The entire Board works with the Board could improve.
As part ofCompensation and Leadership Development Committee to evaluate potential successors to the annual Board self-evaluation, the Board will evaluate whether the current leadership structure continues to be appropriate for Maravai and its shareholders. Our Corporate Governance Guidelines provide the flexibility for our Board to modify our leadership structure in the future as appropriate.
Hedging Transactions
Pursuant to our Insider Trading Policy, we prohibit our employees, directors and officers from engaging in hedging transactions, including hedging or monetization transaction mechanisms including such as the use of financial instruments including, for example, prepaid variable forwards, equity swaps, collars and exchange funds. Additionally, directors, officersCEO and other employees are prohibited from holding our securities inexecutive officers. The CEO and such other officers also make available to the Compensation and Leadership Development Committee their recommendations and evaluations of potential successors, along with a margin account or otherwise pledging our securities as collateralreview of any development plans recommended for a loan.such individuals.
Risk Oversight
Our BoardNominating, Governance and Risk Committee oversees an enterprise-wide approach to risk management, designed to support the achievement of organizational objectives, to improve long-term organizational performance, and to enhance shareholder value. A fundamental part of risk management is not only understanding the most significant risks a company faces and what steps management is taking to manage those risks but also understanding what level of risk is
appropriate for a given company. The involvement of our full BoardNominating, Governance and Risk Committee in reviewing our business is an integral aspect of its assessment of the Company’s risk profile and also its determination of what constitutes an appropriate level of risk.
WhileIn particular, our full Board has overall responsibility for risk oversight, it has delegated primary oversightNominating, Governance and Risk Committee oversees our principal operational, business, compliance and ethics risks, including the appropriateness of certain risks to its committees. Our Audit Committee monitorsreporting lines of authority, communications, systems and controls based on our major financialstructure, size and security risk exposures,scope of operations, and the steps our management has taken to monitor and control these exposures, including guidelines and policies to govern the process by which risk assessment and management is undertaken. In particular, our AuditNominating, Governance and Risk Committee is committed to the prevention, timely detection, and mitigation of the effects of cybersecurity threats or incidents to Maravai. Our AuditNominating, Governance and Risk Committee also monitors compliance with legal and regulatory requirements and management provides our AuditNominating, Governance and Risk Committee periodic reports on our compliance programs. In addition, our Nominating, Governance and Risk Committee oversees our major corporate governance risks. Our Nominating, Governance and Risk Committee also oversees the Company’s sustainability and environmental, social and governance (including climate change) risk management, strategy, initiatives and policies.
While our Nominating, Governance and Risk Committee has overall responsibility for risk oversight, primary oversight of certain risks has been delegated to other committees. Our Audit Committee monitors our
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major financial risk exposure. Our Compensation and NominatingLeadership Development Committee oversees the design and implementation of our compensation policies and programs and monitors the incentives created by these policies and programs. In addition, our Compensation and Nominating Committee oversees our major corporate governance risks. We are committed to ensuring ourthe Board and its committees are consistently updated on threats to our business and receive consistent updates on risk mitigation processes.
In connection with its reviews of the operations of our business, our full Board addresses the primary risks associated with our business, such as strategic planning. OurThe Board appreciates the evolving nature of our business and industry and is actively involved with monitoring new threats and risks as they emerge. Further, our Board has been closely monitoring the rapidly evolving COVID-19 pandemic, its potential effects on our business, and risk mitigation strategies.
At periodic meetings of ourthe Board and its committees, management reports to and seeks guidance from ourthe Board and its committees with respect to the most significant risks that could affect our business, such as legal risks, information security and privacy risks, and financial, tax and audit related risks.
Code of Ethics
We have adopted a codeCode of ethicsEthics that applies to all of our employees, officers and directors, including those officers responsible for financial reporting. Our codeCode of ethicsEthics is available on our website at investors.maravai.com. We intend to disclose any amendments to the code, or any waivers by the Board of its requirements for any of our directors or executive officers, on our website.website to the extent required by the SEC and/or Nasdaq rules.
Compensation Committee Interlocks and Insider Participation
No interlocking relationships exist between any of the members of ourthe Board and the Board or compensation committee of any other company.
Communications by Shareholders and Other Interested Parties with the Board
Shareholders and other interested parties may contact an individual director, the Board as a group, or a specified Board committee or group, including the non-management or non-GTCR directors as a group, by sending regular mail to:
Maravai LifeSciences Holdings, Inc.
10770 Wateridge Circle Suite 200
San Diego, California 92121
ATTN: Board of Directors
c/o General Counsel and Secretary
Each communication should specify which director or directors the communication is addressed to, as well as the general topic of the communication. Maravai will receive the communications and process them before forwarding them to the addressee. Maravai may also refer communications to other departments within Maravai. Maravai generally will not forward to the directors a communication that is primarily commercial in nature, relates to an improper or irrelevant topic, or requests general information regarding Maravai.
Below is a list of the names, ages, positions, and a brief account of the business experience of the individuals who serve as executive officers of Maravai as of March 31, 2021:21, 2023:
Name | Age | Position | ||||
Carl Hull | Interim Chief Executive Officer | |||||
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Kevin Herde | Chief Financial Officer | |||||
| President, Biologics Safety Testing | |||||
Peter Leddy, Ph.D. | 59 | Chief Administrative Officer | ||||
Brian Neel (1) | 47 | Chief Operating Officer, Nucleic Acid Production | ||||
Christine Dolan | Chief Operating Officer, Biologics Safety Testing | |||||
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Kurt Oreshack | General Counsel and Secretary |
(1) | Mr. Neel notified the Company of his decision to resign from this role and terminate his employment with the Company effective March 31, 2023. |
Carl Hull is the Interim Chief Executive Officer and ChairExecutive Chairman of ourthe Board. His biography can be found above under “Board of Directors and Corporate Governance – Director Nominees to Serve for a Three-Year Term Expiring at the 2024 Annual Meeting.Continuing Directors.”
Eric Tardif has served as our President since he co-founded Maravai in March 2014. Prior to co-founding Maravai, he led corporate development and corporate strategy at Gen-Probe Incorporated. Following the acquisition of Gen-Probe by Hologic, a medical technology company, in 2012, Mr. Tardif was promoted to lead corporate strategy for Hologic. Mr. Tardif began his career as an investment banker executing mergers and acquisitions at investment banking firms Merrill Lynch, Piper Jaffray and Morgan Stanley, with a focus on medical device companies, particularly in the life sciences tools and diagnostics segments. Mr. Tardif has a Master of Science in Finance from Boston College, an MBA from University of British Columbia and a BA in Business Administration from Major Bishops University.
Kevin Herde has served as our Chief Financial Officer since May 2017. Prior to joining Maravai, he served as Executive Vice President and Chief Financial Officer at Sorrento Therapeutics, Inc., a biopharmaceutical company, from April 2016 to May 2017 and as Vice President of Global Blood Screening at Hologic from January 2015 to February 2016. Mr. Herde also served as Vice President, Finance and Corporate Controller at Gen-Probe, a medical diagnostics company, prior to its acquisition by Hologic in 2012. Mr. Herde began his career at KPMG.KPMG, a multinational professional services network. Mr. Herde holds a BBA in Business Administration from University of San Diego and is a certified public accountant in California (inactive).
William E. Martin, III has served as our President for our Biologics Safety Testing operating division since December 5, 2022. Prior to serving as President for our Biologics Safety Testing operating division, Mr. Martin served as our Chief Executive Officer from September 30, 2022 to October 18, 2022, when he was placed on a paid leave of absence as a result of a lawsuit claiming violation of a noncompetition agreement filed by two of Mr. Martin’s former employers. Following the settlement of such dispute, Mr. Martin was appointed President of our Biologics Safety Testing operating division and has served in such capacity since. Prior to joining Maravai, Mr. Martin was Senior Vice President, New Business – Genomic Medicine at Danaher Corporation, a global science and technology company, from July 2021 to July 2022. Martin joined Danaher in 2018 in connection with its acquisition of Integrated DNA Technologies (“IDT”), a supplier of custom nucleic acids, where he served as President of the IDT business under Danaher’s ownership from April 2018 to July 2021. Prior to the acquisition, Mr. Martin served in a variety of roles at IDT since March 1994 and was Chief Operating Officer at the time of the acquisition by Danaher. Mr. Martin holds a BS in biochemistry from the University of Iowa.
Peter Leddy, Ph.D. has served as our Chief Administrative Officer since June 2022. Prior to joining Maravai, Dr. Leddy was Chief Human Resources Officer and a human resources consultant for Aloisio Partners, a human resources consulting firm, from February 2014 to June 2022, where he guided c-suite and leadership teams across a variety of industries through all phases of growth by focusing on cultural alignment, leadership development, talent management, executive compensation, talent acquisition, and succession planning. While at Aloisio Partners, Dr. Leddy advised companies such as Life Technologies, Maravai, Invitrogen (a Thermo Fisher brand), PhenomeX (formerly Berkeley Lights), amongst many others. Prior to joining Aloisio Partners, Dr. Leddy was the Chief Human Resources Officer of Life Technologies, from July 2005 to February 2014. Dr. Leddy holds MS and Ph.D. degrees in industrial/organizational psychology from the Illinois Institute of Technology and a BA in Psychology from Creighton University.
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Brian Neel has served as the Chief Operating Officer for our Nucleic Acid Production business segmentoperating division since October 2017. Mr. Neel notified the Company of his decision to resign from this role and terminate his employment with the Company effective March 31, 2023. Prior to joining Maravai, Mr. Neel was Vice President of Operations of Codex DNA, Inc. (formerly Synthetic Genomics DNA) (“Codex”), a biological equipment company, from May 2016 to October 2017. Prior to joining Codex, Mr. Neel was Vice President of Operations of GenMark Diagnostics, Inc. (“Genmark”), a molecular diagnostics company, from 2014 to 2016. Prior to joining GenMark, Mr. Neel was the Site Manufacturing Operations Leader at Thermo Fisher Scientific (formerly Life Technologies) from January 2013 to June 2014. Prior to joining Thermo Fisher, Mr. Neel was a Global Operations Associate Director and Manufacturing Operations Leader at Life Technologies, a global life sciences company that was ultimately purchased by Thermo Fisher in 2014, for over eleven years. Mr. Neel holds a BS in Microbiology from the University of Missouri.
Christine Dolan has served as the Chief Operating Officer of our Biologics Safety Testing business segmentoperating division since October 2017. Prior to joining Maravai, Ms. Dolan held several operational and business leadership roles including Senior Vice President of Product Development, VP of Global Operations and VPGMVP GM of Development and Analytical Services at Catalent Pharma Solutions, a global provider of delivery technologies, development, drug manufacturing, biologics, gene therapies and consumer health products, where Ms. Dolan worked for over eight years. Prior to joining Catalent Pharma Solutions, Ms. Dolan was Director of Nuclear Operations and Global Quality Control at GE Healthcare, a global medical technology company, and Amersham Health, a leader in medical diagnostics and life sciences. where she worked in progressive management roles for a total of over thirteen years. Ms. Dolan holds a BS in Biology from Lenoir-Rhyne College.
Lisa V. Sellers has served as the Chief Operating Officer of our Protein Detection business segment since August 2020. With over 20 years of experience, Dr. Sellers is an experienced general manager and commercial executive. Prior to joining Maravai, Dr. Sellers was Vice President of Marketing at 10X Genomics, Inc. (“10X”). Prior to 10X, Dr. Sellers led global reagent and instrumentation businesses within Applied Biosystems, Life Technologies and then Thermo Fisher Scientific. While at Thermo Fisher, Dr. Sellers also led B2B business development and sales channels to supply and out-license a portfolio of genetic analysis products and IP to the molecular diagnostic market. Dr. Sellers received her PhD in Chemistry from the University of Colorado at Boulder and her BS in Chemistry from Santa Clara University.
Kurt Oreshack has served as our General Counsel since November 2020. Prior to joining Maravai, Mr. Oreshack was a partner in the law firm of Breakwater Law Group, LLP in Solana Beach, CA, practicing in the field of corporate and securities law. Prior to joining Breakwater Law Group, Mr. Oreshack was the General Counsel of Human Longevity, Inc., a San Diego-based genomic research and in vitro diagnostics company, from June 2015 through September 2017. After leaving Human Longevity, Mr. Oreshack practiced law individually and as General Counsel in Residence at the law firm of Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP in San Diego, CA until joining Breakwater Law Group in January 2019. Mr. Oreshack received a JD from the University of Notre Dame Law School and a BA from Loyola University Chicago. He is a member of the State Bar of California.
EXECUTIVECOMPENSATION DISCUSSION AND DIRECTOR COMPENSATIONANALYSIS
TheIntroduction
This Compensation Discussion and Analysis describes the philosophy, policies, practices and material decisions underlying the compensation which is reported in the executive compensation tables included in this proxy statement for the following section provides compensation information pursuant to the scaled disclosure rules applicable to “emerging growth companies” under the rulesexecutive officers of the SEC and may contain statements regarding future individual and company performance targets and goals. These targets and goals should not be understood to be statements of management’s expectationsCompany (the “NEOs” or estimates of results or other guidance. We specifically caution investors not to apply these statements to other contexts.
We are currently considered an “emerging growth company” within the meaning of the Securities Act for purposes of the SEC’s executive compensation disclosure rules. Accordingly, we are required to provide a Summary Compensation Table and an Outstanding Equity Awards at Fiscal Year-End Table, as well as limited narrative disclosures regarding executive compensation for our last completed fiscal year. Further, our reporting obligations extend only to the following “Named Executive Officers,” who are the individuals who served as our principal executive officer during 2020 and the next two most highly compensated executive officers at the end of the fiscal year ended December 31, 2020. For the fiscal year ended December 31, 2020, our Named Executive Officers and their principal positions were as follows:Officers”):
Named Executive Officer | Principal Position (as of December 31, 2022) | |
Carl Hull | Interim Chief Executive Officer and Executive Chairman of the Board (the “CEO”) | |
Kevin Herde | Chief Financial Officer | |
William E. Martin, III | President, Biologics Safety Testing and former Chief Executive Officer | |
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Brian Neel | Chief Operating Officer, Nucleic Acid Production | |
Christine Dolan | Chief Operating Officer, Biologics Safety Testing |
This discussion may contain forward-looking statementsThe total compensation of each NEO is reported in the Fiscal Year 2022 Summary Compensation Table presented on page 39 of this proxy statement.
As noted above in the section entitled “Proposal 1 – Election of Directors — Board Meetings and Committees,” in October 2022, the Board separated the then Compensation and Nominating Committee’s duties and responsibilities into two separate committees, the Compensation and Leadership Development Committee and the Nominating, Governance and Risk Committee. As used in this Compensation Discussion and Analysis, the term “Compensation Committee” shall refer to the Compensation and Nominating Committee for all dates prior to October 12, 2022, and the Compensation and Leadership Development Committee for all dates on and after October 12, 2022.
Our compensation program is intended to motivate and incentivize our executive officers to achieve our corporate objectives and increase shareholder value. The Compensation Committee continues to evaluate how best to structure our compensation program to ensure that our executives are basedbeing appropriately and competitively compensated while also maintaining compensation levels commensurate with our business performance. During fiscal year 2022, as part of our ongoing effort to align our compensation program with best practices, the Compensation Committee utilized the services of our compensation consultant, Meridian Compensation Partners, LLC (“Meridian”), to evaluate our executive compensation programs. Our fiscal year 2022 compensation program was informed by these efforts.
Leadership Transitions
Mr. Hull served as our CEO from Mr. Hull’s co-founding of Maravai in March 2014 until September 30, 2022, the date of Mr. Martin’s appointment as CEO. Concurrently with the appointment of Mr. Martin as CEO, Mr. Hull ceased to serve as our CEO, but continued to serve as Executive Chairman of the Board. On October 18, 2022, Mr. Martin was placed on a paid leave of absence as a result of a lawsuit claiming violation of a noncompetition agreement filed by two of Mr. Martin’s former employers, and Mr. Hull was appointed as Interim CEO and continued to serve as Executive Chairman of the Board. Such dispute was settled and Mr. Martin was subsequently appointed as the President for our current plans, considerations, expectationsBiologics Safety Testing operating division effective December 5, 2022, with Mr. Hull continuing to serve as our Interim CEO and determinations regardingExecutive Chairman of the Board.
We expect Mr. Martin to be re-appointed as CEO on July 27, 2023. At that time, it is expected that Mr. Hull will transition out of the Interim CEO role, while continuing to serve as Executive Chairman of the Board.
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Dr. Leddy joined the Company as Chief Administrative Officer on June 27, 2022.
Mr. Neel resigned and terminated his employment with the Company effective March 31, 2023.
Throughout these changes, our compensation philosophy and our commitment to pay-for-performance remained consistent.
Shareholder Feedback
Last year, we requested that shareholders approve, on a non-binding, advisory basis, the frequency of our future “say-on-pay” votes, and, as a result of such vote, we expect to conduct the vote to approve, on a non-binding, advisory basis, the compensation of our NEOs once every year. The Compensation Committee will consider the results of future advisory votes on executive compensation as our compensation philosophy continues to evolve and future compensation programs. Actualdecisions are made.
Our 2022 annual meeting of shareholders did not include a say-on-pay resolution as the Company was still exempt from such requirement. This year’s advisory vote on executive compensation programs(Proposal 3) represents the first time that we adopt inour shareholders will have the future may differ materially fromopportunity to approve, on a non-binding, advisory basis, the currently planned programs summarized incompensation of our NEOs.
Compensation Philosophy and Objectives
The overall objective of our compensation program is to encourage and reward the creation of sustainable, long-term value. We pursue this discussion.
Summary Compensation Tableobjective via:
Name and principal position | Year | Salary | Option Awards(1) | Nonequity incentive plan compensation(2) | All Other Compensation(3) | Total | ||||||||||||||||||
Carl Hull, | 2020 | $ | 500,000 | $ | 874,160 | $ | 750,000 | — | $ | 2,124,160 | ||||||||||||||
Chief Executive Officer | 2019 | $ | 485,417 | $ | 1,743,000 | $ | 600,000 | — | $ | 2,828,417 | ||||||||||||||
Eric Tardif, | 2020 | $ | 404,882 | $ | 874,160 | $ | 608,756 | $ | 8,550 | $ | 1,896,348 | |||||||||||||
President and Executive Vice-President, | ||||||||||||||||||||||||
Corporate Development(4) | ||||||||||||||||||||||||
Brian Neel, | 2020 | $ | 328,609 | $ | 874,160 | $ | 649,943 | $ | 8,550 | $ | 1,861,262 | |||||||||||||
Chief Operating Officer, Nucleic Acid Production | 2019 | $ | 314,673 | $ | 428,000 | $ | 142,436 | $ | 8,400 | $ | 893,509 |
• | Alignment with long-term shareholders’ interests. We believe our executives’ interests are directly aligned with those of our shareholders through the use of long-term equity incentives that align the value of the compensation program with stock price growth. |
• | Competitiveness. We believe that our executive compensation programs are designed to attract, motivate, retain and reward qualified and talented executives with the abilities and skills needed to foster long-term value creation by delivering competitive total compensation at target performance levels. |
• | Motivating achievement of financial goals and strategic objectives. We believe that the compensation of our executives is dependent on the achievement of our short-and long-term financial goals and strategic objectives through our annual cash incentive plan, and our long-term equity compensation, via a mix of stock options and restricted stock unit awards, which rewards the creation of shareholder value. |
• | Rewarding superior performance. We believe that performance which exceeds target levels should be appropriately rewarded. We also believe there should be downside risk of below-target payouts if individual or Company financial performance is below target or if strategic objectives are not achieved. Our annual incentive plan recognizes both corporate and individual performance and aligns payouts relative to achievements against target objectives. |
• | Responding to change. We believe that as our industry evolves and our opportunities for competitive business advantages change over time, we must likewise evolve in order to continue to create value. Our compensation programs must similarly be tailored to our strategic priorities (which may require changing the performance measures in our incentive plans) and our current outlook (which may impact how we calibrate incentive plan payouts to various levels of performance). |
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The key elements of our compensation program for our NEOs include:
Compensation Component | Purpose | |
Base Salary A fixed cash element of compensation paid bi-weekly | ✓ Provide pay that is competitive based on the position, scope of responsibilities, breadth and depth of experience, and performance to date. ✓ Enable the Company to attract, motivate, and retain critical executive talent with the necessary qualifications. | |
Bonus A variable cash element tied to the achievement of annual Company financial and individual performance goals | ✓ Focus NEOs on achieving progressively challenging short-term performance goals that align with the Company’s annual operating plan and strategic objectives. ✓ Align incentive payments with results and achievements against targets. | |
Equity Awards Stock-based compensation with vesting and other design features intended to align with long-term value creation | ✓ Focus our NEOs on strategic objectives that enhance the value of the business in the short- and long-term. ✓ Support ownership values and deliver retention incentives that increase the commitment needed to deliver on the Company’s strategies over multiple years. ✓ Promote alignment with shareholder interests by incenting stock price appreciation. |
Pay for performance is a principle imbedded throughout our compensation strategy, our compensation program designs and our compensation decisions. Our compensation program promotes longer term performance and long-term shareholder value creation. The majority of each NEO’s total compensation is “at risk” through annual bonuses and long-term equity incentive awards. Total compensation includes the sum of an NEO’s base salary, target annual bonus and equity awards. The following charts show the mix of fixed compensation (base salary as of December 31, 2022) and at-risk compensation (target annual bonuses and the grant date fair value of annual equity awards (excluding MLSH 1 Units)) of our NEOs in 2022:
Mr. Hull
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Mr. Martin (1) | Average for Messrs. Herde and Neel, Dr. Leddy and Ms. Dolan (2) |
(1) | The amounts |
(2) | The |
New Hire Compensation
William E. Martin, III
Mr. Martin was appointed CEO on September 30, 2022. The Company entered into an employment agreement with Mr. Martin that provides for an initial annual base salary of $750,000 and an annual target bonus opportunity of 125% of Mr. Martin’s annual base salary. In addition, Mr. Martin received a cash sign-on bonus of $470,000. The sign-on bonus is subject to repayment in the event Mr. Martin resigns without “good reason” (as defined in Mr. Martin’s employment agreement) before September 30, 2023.
In October 2022 Mr. Martin received equity awards including:
• | RSUs with |
• | An equity award with a grant date value of $8,855,707, approximately 50% which was delivered in the form of stock options and approximately 50% of which was delivered in the form of RSUs. These equity awards were intended to compensate Mr. Martin for Mr. Martin’s 2022 and 2023 annual equity awards. The stock options vest over a four-year period, with 25% vesting on the first anniversary of the grant date and the remaining portion vesting monthly over the three-year period thereafter, while the RSUs vest one-third annually over a three-year period, in each case subject to Mr. Martin’s continued employment through the applicable vesting date; and |
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• | Additional Performance-based Stock Units (“PSUs”) grant with a grant date fair value of $1,267,401 that will vest 50% in the event the 60-trading day volume-weighted average stock price of the Company’s Class A common stock equals or exceeds $60 (as adjusted for stock splits, stock dividends and other similar events) on the |
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Narrative DisclosureOn October 18, 2022, Maravai placed Mr. Martin on a paid leave of absence as a result of a lawsuit claiming violation of a noncompetition agreement filed by two of Mr. Martin’s previous employers. Such dispute was settled and Mr. Martin was appointed as the President for our Biologics Safety Testing operating division effective December 5, 2022. Mr. Martin continued to Summary Compensation Tablereceive the same compensation package as described above during Mr. Martin’s leave of absence and as the President of our Biologics Safety Testing operating division.
Employment AgreementsOn December 5, 2022, Maravai appointed Mr. Martin to serve as President of Maravai’s Biologics Safety Testing operating division, with the expectation that Mr. Martin will assume the role of CEO of the Company effective July 27, 2023.
We havePeter Leddy, Ph.D.
Dr. Leddy was appointed EVP & Chief Administrative Officer on June 27, 2022. The Company entered into an employment agreementsagreement with each of our Named Executive OfficersDr. Leddy that provideprovides for an initial annual base salary of $450,000, an initial target bonus opportunity paid vacation, reimbursement of $315,000 for 2022 and a target bonus opportunity of 70% of Dr. Leddy’s annual base salary in subsequent years. In addition, Dr. Leddy received a cash sign-on bonus of $100,000. The sign-on bonus is subject to repayment in the event Dr. Leddy resigns without “good reason” (as defined in Dr. Leddy’s offer letter) before June 27, 2023.
In July 2022 Dr. Leddy received an equity award with a grant date fair value of approximately $3,166,502, approximately 50% which was delivered in stock options and approximately 50% of which was delivered in RSUs. Approximately 50% of these equity awards were intended to compensate Dr. Leddy for Dr. Leddy’s 2022 annual equity awards while the remaining 50% provided an additional inducement to join us. The stock options vest over a four-year period, with 25% vesting on the first anniversary of the grant date and the remaining portion vesting monthly over the three-year period thereafter, while the RSUs vest one-third annually over a three-year period, each subject to Dr. Leddy’s continued employment through the applicable vesting date.
Under their respective employment agreements, if either Mr. Martin or Dr. Leddy’s employment is terminated by the Company other than for “cause” or if Mr. Martin or Dr. Leddy resigns for good reason, Mr. Martin or Dr. Leddy, as applicable, will be entitled to receive the severance benefits described in the section of this Proxy Statement titled “Additional Narrative Disclosure – Potential Payments Upon Termination or Change in Control.”
Compensation-Setting Process
The Compensation Committee has engaged Meridian, an independent compensation consulting firm, to provide research and analysis and to make recommendations on the form and level of executive compensation. The Compensation Committee sought input from Meridian on executive compensation matters for 2022, including the design and competitive position of our executive compensation program, our Peer Group (as defined below), appropriate compensation levels, and evolving compensation trends.
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Based on its consideration of the various factors set forth in the rules promulgated by the SEC and the Nasdaq listing rules, the Compensation Committee has determined that the work performed by Meridian has not raised any conflict of interest.
The Compensation Committee formulates its compensation decisions for the NEOs with input from the CEO (other than with respect to the CEO’s own compensation), considering such factors as each NEO’s professional experience, job scope, past performance, tenure and retention risk. The Compensation Committee also considers prior fiscal year adjustments to compensation, historical annual bonus award payments and equity awards. Finally, the Compensation Committee considers current market practices, based on its review of executive compensation data for comparable companies, as well as current compensation trends, to ensure that the compensation of the NEOs is both competitive and reasonable, business expenseswhile also maintaining compensation levels commensurate with our financial and eligibilitystock performance.
The Compensation Committee reviews the base salary, annual target bonus opportunities, equity awards and target total direct compensation opportunity (which represents the sum of these three elements) for each of the NEOs annually. The CEO makes recommendations to participatethe Compensation Committee for annual increases in base salary, the annual target bonus opportunity and equity awards for each of the NEOs (other than with respect to the CEO), taking into account the recommendations of Meridian. The Compensation Committee has the final authority to approve annual increases in the base salary, annual target bonus award and equity awards for the NEOs other than the CEO. The Compensation Committee evaluates the CEO’s performance annually and recommends to the Board the CEO’s base salary and annual bonus award based on this evaluation.
With respect to annual target bonus awards, prior to the start of each fiscal year, the CEO develops Company performance metrics aligned with our benefit plans generally.annual operating plan for our salaried employees, including the NEOs. These goals represent key performance objectives that are incorporated into the annual bonus framework, which framework is then submitted to the Compensation Committee for consideration and approval. After our fiscal year-end financial results are available, the annual incentive award pool for employees and individual annual bonus award payments for the NEOs for the just-completed fiscal year are approved by the Compensation Committee, except with respect to the CEO. The Compensation Committee evaluates the CEO’s performance annually and recommends to the Board the CEO’s annual bonus award payment based on this evaluation.
Base Salaries: Messrs. Hull’s, Tardif’sThe Compensation Committee reviews multiple factors in determining the overall equity value to award each NEO, including competitive market data, dilution, share usage, stock compensation expense, the financial and Neel’s annualized base salariesoperational performance of the Company, each NEO’s individual performance, and the value of equity grants both individually to each NEO and in the aggregate to all NEOs. The CEO makes recommendations to the Compensation Committee for equity awards for each of the NEOs (other than with respect to the CEO), taking into account the recommendations of Meridian. The Compensation Committee has the final authority to approve annual increases in the equity awards for the NEOs other than the CEO. The Compensation Committee evaluates the CEO’s performance annually and recommends to the Board the CEO’s equity awards based on this evaluation.
Competitive Positioning
Meridian conducted a competitive market analysis at the end of 2021 to support the 2020 fiscal year were $500,000, $407,783Compensation Committee in connection with its executive and $333,238, respectively.
Bonus Plan: Messrs. Hull’s, Tardif’s and Neel’s target annual bonuses were 100%, 75% and 40%non-employee director compensation decisions made in the first half of base salary, respectively. For the 2020 fiscal year, Messrs. Hull, Tardif and Neel received bonus payments (inclusive2022. To develop an understanding of the amounts payable pursuantcompetitive marketplace, the Compensation Committee reviewed the executive compensation practices of a group of publicly-traded companies (the “Peer Group”) based on compensation data gathered from publicly-available filings. Meridian worked with the Compensation Committee to establish the Company’s Peer Group.
The Compensation Committee uses the market analysis as a reference point to ensure that our executive compensation program is competitive with market practice. In the case of each executive officer, the
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Compensation Committee considers the overall compensation of each individual against the compensation data developed through the market analysis, and whether his or her position is sufficiently similar to the supplemental bonus plan described below) of $750,000, $608,756positions identified in the data to make the comparison meaningful. Ultimately, the Compensation Committee’s decisions with respect to each executive’s total compensation, and $649,943, respectively,each individual compensation element, are based in part on pre-established company performance metrics and based inlarge part on its assessment of Company and individual achievement. performance as well as other factors, such as internal pay equity. The pre-established company performance metricsCompensation Committee and Meridian reviewed and considered factors such as industry, total revenue, market capitalization, growth and profitability margins in determining the Peer Group to be utilized in making compensation decisions for in the 2020 fiscal year consistedfirst half of Revenue (weighted 30%), Adjusted EBITDA (weighted 50%), and achievement of corporate initiatives (weighted 20%). Additionally, the Board approved a supplemental bonus plan for fiscal year 2020, which2022. The Peer Group was fundedselected based on the Company’sevaluation of all of these factors, and consisted of the following 15 companies:
10x Genomics Inc. | Medpace Holdings, Inc. | |
Adaptive Biotechnologies Corporation | Natera, Inc. | |
Azenta, Inc. (f/k/a. Brooks Automation) | Neogen Corporation | |
Bio-Techne Corporation | NeoGenomics, Inc. | |
Globus Medical, Inc. | Neurocrine Biosciences, Inc. | |
Halozyme Therapeutics, Inc. | Repligen Corporation | |
Invitae Corporation | Sotera Health Company | |
Masimo Corporation |
At the time of the competitive market analysis conducted at the end of 2021, our own revenue was near the Peer Group’s 59th percentile while our market capitalization was near the Peer Group’s 75th percentile.
In July 2022, at the Compensation Committee’s request, Meridian presented recommendations for an updated Peer Group in recognition of industry M&A activity and our own growth and evolution. At that time, the Compensation Committee approved the removal of Adaptive Biotechnologies, Invitae Corporation, and NeoGenomics. The Compensation Committee also approved the addition of Bio-Rad Laboratories, Bruker Corporation, Insulet Corporation, Tandem Diabetes Care, and Waters Corporation. This updated Peer Group was referenced by the Compensation Committee in making compensation decisions with respect to our NEOs (and by the independent members of the Board, in making compensation decisions with respect to our CEO) during the second half of 2022 and for 2023.
Compensation Elements
Base Salaries
During 2022, the Compensation Committee reviewed the base salaries of the NEOs and (i) made adjustments (except with respect to the CEO’s base salary) and (ii) recommended adjustments to the Board (with respect to the CEO’s base salary), in each case to ensure that they are competitive when considered against the Peer Group, with consideration given to unique qualifications, substantial contributions and internal value to the Company.
Name | 2021 Base ($) | 2022 Base ($) | Increase ($) | Increase (%) | ||||||||||||
Mr. Hull (1) | $ | 600,000 | $ | 725,040 | $ | 125,040 | 20.8 | % | ||||||||
Mr. Martin (2) | N/A | 750,000 | N/A | N/A | ||||||||||||
Mr. Herde (1) | 420,000 | 453,600 | 33,600 | 8.0 | % | |||||||||||
Dr. Leddy (3) | N/A | 450,000 | N/A | N/A | ||||||||||||
Ms. Dolan (1) | 424,000 | 438,841 | 14,841 | 3.5 | % | |||||||||||
Mr. Neel (1) | 400,000 | 438,000 | 38,000 | 9.5 | % |
(1) | Salary adjustments effective February 27, 2022. |
(2) | Salary adjustment effective on employment start date of September 30, 2022. |
(3) | Salary adjustment effective on employment start date of June 27, 2022. |
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Annual Bonus
The Compensation Committee periodically reviews and determines (for each NEO other than the CEO) and recommends to the Board (for the CEO) the target annual bonus award opportunities (expressed as a percentage of base salary) that each of the NEOs may earn. The target annual bonus award opportunity for each NEO (expressed as a percentage of base salary) was established in his or her respective employment agreement and is reviewed periodically by the Compensation Committee.
The actual annual bonus amount earned each year by our NEOs may be more or less than the target amount depending on an assessment of the performance of the Company (the Company performance factor or “CPF”) and the individual’s performance against a set of pre-established goals and objectives conducted after the end of the fiscal year.
The 2022 CPF referenced both Revenue and Adjusted EBITDA goals (as defined below). Achievement of 100% of target goals (referencing our 2022 budget) for both Revenue and Adjusted EBITDA would fund a payout at 100% of target bonus award opportunities. Threshold achievement of 80% of each of the target goals was necessary to fund the minimum payout of 25% of target bonus award opportunities, while maximum achievement of 120% of each of the target goals was necessary to fund the maximum payout of 200% of target bonus award opportunities.
The table below illustrates CPF application to various levels of performance against our 2022 budget. Revenue and Adjusted EBITDA above certain thresholds. Mr. Tardifachievement relative to 2022 budget determine performance scores for each metric. The applicable performance scores for each metric are multiplied together to produce a CPF (expressed as a percentage of target bonus award opportunity, rounded to the next whole percentage point), subject to a maximum CPF equal to 200% of target, which is then multiplied by the NEO’s bonus target. Linear interpolation is applied to the performance scores for performance between threshold and Mr. Neel received supplemental bonus payments of $150,000target and $450,000, respectively. between target and maximum.
For the 2020 fiscal year,2022, we achieved $883.0 million in Revenue as compared to a target of $892.4 million and $637.8 million in Adjusted EBITDA as compared to a target of $630.2 million. This performance resulted in a 99% achievement on the pre-established companyRevenue performance metrics at 172%scale for a payout factor of 97%, and 101% achievement on the Adjusted EBITDA performance scale for a payout factor of 105%. Based on the total CPF of 101% (representing the average of the separate Revenue and Adjusted EBITDA payout factors), the Compensation Committee approved a payout equal to 101% of target under our original bonus plan and 245%award opportunities for each of the NEOs other than Mr. Martin.
Per the terms of Mr. Martin’s employment agreement, Mr. Martin received a payout equal to 100% of Mr. Martin’s target under our supplemental bonus plan. Under our original bonus plan, the company performance metric score was then adjusted based on individual achievement to yield total achievement scores, which corresponded to payouts of 150% of targetaward opportunity for Mr. Hull, 151% of target for Mr. Tardif and 152% of target for Mr. Neel.2022.
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We define Adjusted EBITDA as net income (loss) before interest, taxes, depreciation and amortization, certain non-cash items, and other adjustments that we do not consider in our evaluation of ongoing operating performance from period to period. Revenue is GAAP revenue. For more information about how we calculate Adjusted EBITDA, and for a reconciliation of Adjusted EBITDA to GAAP net income, please see “Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the SEC on February 28, 2023.
Severance Benefits: The employment agreements also provide for certain severance benefits upon a resignationFor fiscal 2022 the target bonus award opportunities and actual bonus payments that were determined by the applicable Named Executive OfficerCompensation Committee are set forth below:
Target Bonus Award Opportunity | Actual Bonus Award | |||||||||||
Name | % of Base Salary | Dollar Value | Dollar Value | |||||||||
Mr. Hull | 100 | % | $ | 725,040 | $ | 732,290 | ||||||
Mr. Martin (1) | 125 | % | 937,500 | 937,500 | ||||||||
Mr. Herde | 70 | % | 317,520 | 320,695 | ||||||||
Dr. Leddy (2) | 70 | % | 315,000 | 318,150 | ||||||||
Ms. Dolan | 70 | % | 307,189 | 310,260 | ||||||||
Mr. Neel | 70 | % | 306,600 | 309,666 |
(1) | Full bonus at target guaranteed in 2022 per terms of Mr. Martin’s employment agreement. |
(2) | Eligible for full target bonus in year-of-hire, without pro-ration for date of hire, per terms of Dr. Leddy’s employment agreement. |
Equity Awards
2022 Decisions
On January 25, 2022, we granted annual equity awards to our NEOs comprised of a combination of non-qualified stock options and RSUs. We use this combination of non-qualified stock options and RSUs to balance (i) the pay-for-performance and risk orientation of stock options which enhance our pay-for-performance culture and (ii) the retentive effect of RSUs. The Compensation Committee believes this mix to be reasonable considering market practices, the overall level of pay for “good reason” or upon a termination byour executives and the Company without “cause.” Please seelong-term orientation of the equity award vehicles. Approximately 50% of the target value of each award was delivered in stock options and approximately 50% was delivered in RSUs.
In addition, as part of their new hire offers we awarded Mr. Martin and Dr. Leddy equity awards as described under the section entitled “Additional Narrative Disclosure—Potential Payments Upon Termination or Change in Control” below for more details regarding“New Hire Compensation” above.
The Compensation Committee approved the severance benefits providedfollowing equity incentives to our Named Executive Officers under the employment agreements.NEOs in 2022:
Equity Incentives
Number of Awards by Type | ||||||||||||||||||||
Name | Date of Grant | Aggregate Grant Date Fair Value | Stock Options (1) | Restricted Stock Units (2) | Performance Stock Units (maximum) (3) | |||||||||||||||
Mr. Hull | 1/25/22 | $ | 4,027,128 | 151,200 | (4) | 81,600 | — | |||||||||||||
Mr. Martin | 10/17/22 | 12,453,877 | 403,946 | (5) | 348,055 | 240,038 | ||||||||||||||
Mr. Herde | 1/25/22 | 963,206 | 36,200 | (4) | 19,500 | — | ||||||||||||||
Dr. Leddy | 7/15/22 | 3,166,502 | 122,893 | (6) | 63,498 | — | ||||||||||||||
Mr. Neel | 1/25/22 | 838,985 | 31,500 | (4) | 17,000 | — | ||||||||||||||
Ms. Dolan | 1/25/22 | 838,895 | 31,500 | (4) | 17,000 | — |
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(1) | For Messrs. Hull, Herde, Neel and Ms. Dolan, the stock options vest over a four-year period in monthly increments starting March 15, 2022, in each case subject to continued employment through each vesting date. For Mr. Martin, the stock options vest over a four-year period, with 25% vesting on October 15, 2023, and the remainder vesting in equal monthly installments over the following thirty-six months, subject to continued employment through each vesting date. For Dr. Leddy, the stock options vest over a four-year period, with 25% on July 15, 2023, and monthly thereafter over the next three years, subject to continued employment through each vesting date. |
(2) | For Messrs. Hull, Herde, Neel and Ms. Dolan, the RSUs vest one-third annually over a three-year period starting February 15, 2023, in each case subject to continued employment through each vesting date. For Mr. Martin, 120,019 of the RSUs vest 50% on each of October 15, 2023, and October 15, 2024, subject to continued employment through each vesting date, and 228,036 of the RSUs vest in equal installments on each of October 15, 2023, October 15, 2024, and October 15, 2025, subject to continued employment through each vesting date. For Dr. Leddy, the RSUs vest in equal installments on each of July 15, 2023, July 15, 2024, and July 15, 2025, subject to continued employment through each vesting date. |
(3) | Fifty percent of the performance stock units will vest in the event the 60-day trading volume-weighted average stock price of our Class A common stock equals or exceeds $60 (as adjusted for stock splits, stock dividends and other similar events) on October 15, 2025, and the remaining fifty percent of the performance stock units will vest in the event the 60-day trading volume-weighted average stock price of our Class A common stock equals or exceeds $100 (as adjusted for stock splits, stock dividends and other similar events) on October 15, 2025, in each case subject to Mr. Martin’s continued employment through such date. In addition, in the event of a Change in Control (as defined in the Omnibus Plan) prior to October 15, 2025, the performance stock units will convert into time-based restricted stock units that will vest in their entirety on October 15, 2025, subject to Mr. Martin’s continued employment through such date. |
(4) | Exercise price of $26.32. |
(5) | Exercise price of $19.42. |
(6) | Exercise price of $24.94. |
Incentive Units
Historically,Prior to our 2020 IPO, we have offered equity incentives to our Named Executive OfficersNEOs through grants of incentive units in MLSH 1.1 (the “MLSH 1 Units”). Certain of these incentive unit awards arewere subject to time-based vesting requirements and are
subject to accelerated vesting upon the occurrence of certain terminations of employment and certain change-in-control events, and the remaining incentive unit awards arewere subject to market and performance-based vesting requirements and would terminate if such performance-based vesting requirements arewere not met upon certain change-in-control events. As anticipated, the The consummation of our IPO did not trigger accelerated vesting of any of the incentive units in MLSH 1 Units that arewere subject to time-based vesting requirements; however, as we expected the vesting of the incentive units subject to performance-based vesting requirements were acceleratedwas achieved as a result of the IPO. See belowOutstanding MLSH 1 Units held by our NEOs are described under “—Additional Narrative Disclosure—Potential Payments Upon Termination or Change in Control” for additional information regarding the circumstances that could result in accelerated vesting of these awards.section entitled “Outstanding Equity Awards at Fiscal Year-End” below.
Stock Options
In connection with our IPO, we granted certain employees, including our Named Executive Officers,NEOs, stock options with respect to our Class A common stock pursuant to our 2020the Omnibus Incentive Plan. These stock option awards vest over four years with 25% vesting on the first anniversary of the grant date and the remaining portion of the awardawards vesting monthly over the three-year period thereafter, subject to the recipient’s continued employment through each vesting date. These stock options were issued with an exercise price equal to the IPO price of $27.00 per share. See
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No Special Retirement, Health or Welfare Benefits
We do not have a defined benefit pension plan or nonqualified deferred compensation plan. We currently maintain a retirement plan intended to provide benefits under Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”), pursuant to which employees, including the NEOs, can make voluntary pre-tax contributions or Roth post-tax contributions. We match 50% of elective deferrals up to the first 6% of such participant’s annual base salary for all participants. These matching contributions are vested or vest based on the participant’s length of service with us, becoming fully vested on the second anniversary of the participant’s date of hire. All contributions under the plan are subject to certain annual dollar limitations, which are periodically adjusted for changes in the cost of living.
We also maintain the 2020 Employee Stock Purchase Plan (“ESPP”). The ESPP authorizes the grant of options to employees, including the NEOs, so long as they do not own stock representing 5% or more of the total combined voting power or value of all classes of Common Stock and other stock of the Company, a Parent or a Subsidiary. Due to our “Up-C” structure, the ESPP is not currently tax-qualified under Section 423 of the Code. Each offering period is approximately twenty-four months in duration commencing on each May 1 and November 1 of each year during the term of the ESPP. The ESPP allows participants to purchase Class A common stock through payroll deductions of up to 15% of their eligible compensation. The purchase price of the shares is 85% of the lower of the fair market value of our Class A common stock on the grant date or purchase date.
All full-time employees, including the NEOs, are eligible to participate in health and welfare benefit programs, including medical, dental and vision care coverage, disability, and life insurance.
Compensation Policies
Prohibition on Option Re-Pricing and Backdating
The Compensation Committee does not re-price and has not re-priced options to purchase shares of our Class A common stock, consistent with the Omnibus Plan, which prohibits re-pricing of equity awards without shareholder approval. The grant date for each equity award is based on the date the award is approved by the Compensation Committee or the independent members of the Board, as applicable. Options to purchase shares of our Class A common stock are granted with an exercise price equal to the closing market price of our Class A common stock on the date of grant.
Compensation Recovery Policy
The Company has adopted a clawback policy that allows the Board to seek recoupment of certain executive compensation in the event of an accounting restatement resulting from material noncompliance with financial reporting requirements under the federal securities laws. The policy applies to the Company’s current and former “executive officers,” as that term is defined for purposes of the Exchange Act (“Covered Executives”). “Incentive Compensation” under the Clawback Policy includes both cash-settled and equity-incentives, provided that such compensation is granted, earned or vested, wholly or in part, on the attainment of a financial measure. In the event the Company is required to prepare an accounting restatement of its financial statements due to the Company’s material noncompliance with any financial reporting requirement under the federal securities laws, the Board will assess whether the Company should seek to recover any excess Incentive Compensation received by any Covered Executives during the three completed fiscal years immediately preceding the date on which the Company is required to prepare an accounting restatement. The maximum amount subject to recoupment will be the excess of what the executive received and what he or she would have received under the corrected financial metrics over the three-year period prior to the restatement, as determined by the Board.
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We are reviewing the final rule issued by the SEC implementing the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act relating to the clawback of incentive-based compensation and will amend the Clawback Policy following the Nasdaq’s adoption of its final listing standards in accordance with the SEC clawback rules.
Anti-Hedging and Anti-Pledging Policy
Pursuant to our Insider Trading Policy, we prohibit our employees, directors and officers from engaging in hedging transactions, including hedging or monetization transaction mechanisms and the use of financial instruments such as prepaid variable forwards, equity swaps, collars and exchange funds. Additionally, directors, officers and other employees are prohibited from holding our securities in a margin account or otherwise pledging our securities as collateral for a loan.
Stock Ownership Guidelines
In January 2022, we adopted minimum stock ownership guidelines applicable to non-employee independent directors and executive officers. Guidelines are shown in the table below:
Position | Ownership Guideline | |
Chief Executive Officer | Five times base salary | |
President, Chief Operating Officer and/or Chief Financial Officer | Three times base salary | |
Other Executive Officers | One and a half times base salary | |
Non-Employee Independent Directors | Four times annual board cash retainer |
While the guidelines do not prescribe a timeline for compliance, they require executives subject to the guidelines to hold at least 50% of the stock received from equity awards (on a shares-issued, net-of-tax-withholding basis) until the minimum ownership requirement level is achieved, or at any time their ownership subsequently falls below the guidelines.
The following shares and awards may be counted for purposes of assessing compliance with the guidelines:
Maravai Class A common stock owned (i) directly by the executive officer or director or his or her spouse, (ii) jointly by the executive officer or director and his or her spouse, and (iii) indirectly by a trust, partnership, limited liability company or other entity for the benefit of the executive officer or director or his or her spouse;
100% of unvested restricted stock and restricted stock unit awards issued under “—Additional the Company’s equity incentive plans that remain unvested solely due to additional service-based vesting requirements;
100% of Class A common stock issued under the Company’s ESPP; and
Other shares held in retirement accounts.
Compensation Risk Assessment
The Compensation Committee has reviewed our incentive compensation programs, discussed the concept of risk as it relates to our compensation program, considered various mitigating factors and reviewed these items with Meridian. In addition, the Compensation Committee reviewed an independent risk assessment of our executive compensation program conducted by Meridian. Based on these reviews and discussions, the Compensation Committee does not believe our compensation program creates risks that are reasonably likely to have a material adverse effect on our business.
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Tax and Accounting Considerations
We operate our compensation programs with the good faith intention of complying with Section 409A of the Code. We account for equity-based payments with respect to our long-term equity incentive award programs in accordance with the requirements of FASB ASC Topic 718, Compensation – Stock Compensation.
In evaluating the Company’s executive compensation program, the Compensation Committee considers tax and accounting treatment, balancing the effects on the individual and the Company. The Compensation Committee believes that the potential deductibility of the compensation payable under those programs should be only one of a number of relevant factors taken into consideration, and not the sole or primary factor, in establishing the cash and equity compensation programs for the executive officers. Section 162(m) of the Code generally limits to $1.0 million the amount of remuneration that the Company may deduct in any calendar year for certain executive officers. The Compensation Committee believes that cash and equity incentive compensation must be maintained at the requisite level to attract and retain the executive officers essential to the Company’s financial success, even if all or part of that compensation may not be deductible by reason of the Section 162(m) limitation. Accordingly, the Compensation Committee will continue to maintain flexibility and the ability to pay competitive compensation by not requiring all compensation to be deductible.
Compensation and Leadership Development Committee Report
The Compensation and Leadership Development Committee has reviewed and discussed with management the Compensation Discussion and Analysis as set forth in this proxy statement. Based upon this review and discussion, the Compensation and Leadership Development Committee recommended to the Board that the Compensation Discussion and Analysis be incorporated by reference in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, and included in the Company’s proxy statement filed in connection with the Company’s 2023 annual meeting of shareholders.
Respectfully submitted by the Compensation and Leadership Development Committee of the Board of Directors:
Anat Ashkenazi (Chair)
Susannah Gray
Constantine Mihas
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EXECUTIVE AND DIRECTOR COMPENSATION
Summary Compensation Table
Name and Principal Position | Year | Salary ($) | Bonus ($)(1) | Stock Awards ($)(2) | Option Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | ||||||||||||||||||||||||
Carl Hull | | 2022 2021 2020 |
| | 721,383 580,769 500,000 |
| | 2,147,712 | | | 1,879,416 874,160 |
| | 732,290 1,200,000 750,000 |
| | 5,480,801 1,780,769 2,124,160 |
| ||||||||||||||
William E. Martin, III (7) | 2022 | 660,385 | 470,000 | 8,026,629 | 4,427,248 | 937,500 | 1,731 | 14,523,493 | ||||||||||||||||||||||||
Kevin Herde (6) | | 2022 2021 |
| | 448,431 412,788 |
| | 513,240 | | | 449,966 | | | 320,695 420,000 |
| | 9,150 8,810 |
| | 1,741,482 841,598 |
| |||||||||||
Peter Leddy, Ph.D. (7) | 2022 | 333,654 | 100,000 | 1,583,640 | 1,582,862 | 318,150 | 5,192 | 3,923,498 | ||||||||||||||||||||||||
Brian Neel | | 2022 2021 2020 |
| | 432,154 388,661 328,609 |
| | 447,440 | | | 391,545 874,160 |
| | 309,666 400,000 649,943 |
| | 8,721 8,550 |
| | 1,580,805 797,382 1,861,262 |
| |||||||||||
Christine Dolan (6) | | 2022 2021 |
| | 436,557 411,887 |
| | 447,440 | | | 391,545 | | | 310,260 424,001 |
| | 9,150 8,782 |
| | 1,594,953 844,670 |
|
(1) | The amounts reported in the Bonus column represent for Mr. Martin and Dr. Leddy one-time guaranteed sign-on bonuses in connection with the commencement of their employment. |
(2) | The amounts reported in the Stock Awards column for all NEOs, other that Mr. Martin, represent the grant date fair value of restricted stock units with respect to our Class A common stock, in each case, granted to the NEOs as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation. The amount reported in this column for Mr. Martin represents the grant date fair value of performance stock units with respect to our Class A common stock (the “Martin PSUs”) and restricted stock units with respect to our Class A common stock, in each case, granted to Mr. Martin as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation. The assumptions used in calculating the grant date fair value of the Martin PSUs are set forth in Note 1 to the consolidated financial statements included in our Annual Report Form 10-K for the fiscal year ended December 31, 2022. The amounts reported in this column reflect the accounting cost for these performance stock units and do not correspond to the actual economic value that may be received by the NEOs for the stock options or performance stock units, as applicable. |
(3) | The amounts reported in the Option Awards column for all NEOs represent the grant date fair value of, for 2022, stock options with respect to our Class A common stock (the “2022 Options”) and for 2020, stock options with respect to our Class A common stock (the “2020 Options”), in each case, granted to the NEOs as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation. The assumptions used in calculating the grant date fair value of the 2022 Options in the Option Awards column are set forth in Note 12 to the consolidated |
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financial statements included in our Annual Report Form 10-K for the fiscal year ended December 31, 2022. The assumptions used in calculating the grant date fair value of the 2020 Options in the Option Awards column are set forth in Note 10 to the consolidated financial statements included in our Annual Report Form 10-K for the fiscal year ended December 31, 2021. 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 the NEOs for the stock options. See “Compensation Discussion and Analysis—Equity Awards” for additional details. |
(4) | The amounts reported in the Non-Equity Incentive Plan Compensation column reflect bonuses paid to the NEOs for 2020, with respect to the fiscal year ended December 31, 2020, for 2021, with respect to the fiscal year ended December 31, 2021, and for 2022, with respect to the fiscal year ended December 31, 2022. See the section entitled “Narrative Disclosure to Summary Compensation Table—Employment Agreements” below for additional details. |
(5) | The amounts reported in the All Other Compensation column reflect 401(k) plan matching contributions made on behalf of the NEOs, for 2020, during the fiscal year ended December 31, 2020, for 2021, during the fiscal year ended December 31, 2021, and for 2022, during the fiscal year ended December 31, 2022. See “Compensation Discussion and Analysis—No Special Retirement, Health or Welfare Benefits” for additional information regarding 401(k) plan contributions. |
(6) | Mr. Herde and Ms. Dolan were not named executive officers for the fiscal year ended December 31, 2020; therefore, we did not include their prior compensation. |
(7) | Mr. Martin and Dr. Leddy were not named executive officers for the fiscal years ended December 31, 2020 or December 31, 2021; therefore, we did not include their prior compensation. |
Narrative Disclosure—Disclosure to Summary Compensation Table
Employment Agreements
We have entered into employment agreements with each of our NEOs that provide for annual base salary, target bonus opportunity, paid vacation, reimbursement of reasonable business expenses and eligibility to participate in our benefit plans generally. Additionally, we have entered into employment agreements with certain of our NEOs that provide for sign-on bonuses.
The employment agreements also provide for certain severance benefits upon a resignation by the applicable NEO for “good reason” or upon a termination by the Company without “cause.” Please see the section entitled “Additional Narrative Disclosure — Potential Payments Upon Termination or Change in Control” below for additional informationmore details regarding the circumstances that could result in accelerated vestingseverance benefits provided to our NEOs under the employment agreements.
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2022 Grants of these awards.Plan-Based Awards
The following table sets forth certain information with respect to grants of plan-based awards for the fiscal year ended December 31, 2022 with respect to our NEOs.
Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) | All other stock awards: Number of shares of stock or units (#) | All other option awards: Number of securities underlying options (#) | Exercise or base price of option awards ($/Sh) | Grant date fair value of stock and option awards | ||||||||||||||||||||||||||||||||
Name | Grant Date | Approval Date | Threshold ($) | Target ($) | Maximum ($) | |||||||||||||||||||||||||||||||
Carl Hull |
|
1/25/2022 (2 1/25/2022 (3 |
) ) | 181,260 | 725,040 | 1,450,080 |
|
81,600 |
|
| 151,200
|
|
| 26.32
|
|
|
1,879,416 2,147,712 |
| ||||||||||||||||||
William E. Martin, III |
|
10/17/2022 (4 10/17/2022 (6 10/17/2022 (7 10/17/2022 (8 |
) ) ) ) | | 10/12/2022 (5 10/12/2022 (5 10/12/2022 (5 10/12/2022 (5 | ) ) ) ) | 234,375 | 937,500 | 1,875,000 | | 120,019 228,036 240,038 |
|
|
403,946 |
|
|
19.42 |
| | 4,427,248 2,330,769 4,428,459 1,267,401 |
| |||||||||||||||
Kevin Herde |
|
1/25/2022 (2 1/25/2022 (3 |
) ) | 79,380 | 317,520 | 635,040 | 19,500 |
| 36,200
|
|
| 26.32
|
| | 449,966 513,240 |
| ||||||||||||||||||||
Peter Leddy, Ph.D. |
|
7/15/2022 (9 7/15/2022 (11 |
) ) | | 5/22/2022 (10 5/22/2022 (10 | ) ) | 78,750 | 315,000 | 630,000 | 63,498 |
| 122,893
|
|
| 24.94
|
| | 1,582,862 1,583,640 |
| |||||||||||||||||
Brian Neel |
|
1/25/2022 (2 1/25/2022 (3 |
) ) | 76,650 | 306,600 | 613,200 | 17,000 |
| 31,500
|
|
| 26.32
|
| | 391,545 447,440 |
| ||||||||||||||||||||
Christine Dolan |
|
1/25/2022 (2 1/25/2022 (3 |
) ) | 76,797 | 307,189 | 614,377 | 17,000 |
| 31,500
|
|
| 26.32
|
| | 391,545 447,440 |
|
(1) | Represents threshold, target and maximum annual cash incentive for the 2022 fiscal year. The threshold amount for each executive officer is 25% of target, as the minimum amount payable if threshold performance is achieved. If the threshold is not achieved, the payment would be zero. The maximum amount for each executive officer is 200% of target and reflects the maximum amount payable if maximum performance is achieved. The pre-established company performance metrics for the 2022 fiscal year consisted of Revenue (weighted 50%) and Adjusted EBITDA (weighted 50%). |
(2) | Amount shown is the number of stock options with respect to our Class A common stock awarded on January 25, 2022. The stock options will vest in equal installments on the 15th of every month from March 2022 through February 2026, subject to such NEO’s continued employment through each vesting date. |
(3) | Amount shown is the number of time-based restricted stock units with respect to our Class A common stock awarded on January 25, 2022. The restricted stock units will vest in equal installments on February 15 of each of 2023, 2024 and 2025, subject to such NEO’s continued employment through each vesting date. |
(4) | Amount shown is the number of time-based stock options with respect to our Class A common stock awarded on October 17, 2022, as part of Mr. Martin’s employment agreement (the “Martin Option”). Twenty-five percent of the Martin Option will vest on October 15, 2023, and the remainder of the Martin Option will vest in equal monthly installments over the following thirty-six months, subject to Mr. Martin’s continued employment through such dates. |
(5) | Represents the date such equity award was approved by the Board. |
(6) | Amount shown is the number of time-based restricted stock units with respect to our Class A common stock awarded on October 17, 2022, as part of Mr. Martin’s employment agreement. The restricted stock units will vest at a rate of one-half of the grant per year on October 15, 2023 and October 15, 2024, subject to Mr. Martin’s continued employment through such dates. |
(7) | Amount shown is the number of time-based restricted stock units with respect to our Class A common stock awarded on October 17, 2022, as part of Mr. Martin’s employment agreement. The restricted stock |
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units will vest at a rate of one-third of the grant per year on October 15, 2023, October 15, 2024, and October 15, 2025, subject to Mr. Martin’s continued employment through such dates. |
(8) | Amount shown is the number of performance stock units with respect to our Class A common stock awarded on October 17, 2022, as part of Mr. Martin’s employment agreement. Fifty percent of the performance stock units will vest in the event the 60-day trading volume-weighted average stock price of our Class A common stock equals or exceeds $60 (as adjusted for stock splits, stock dividends and other similar events) on October 15, 2025, and the remaining fifty percent of the performance stock units will vest in the event the 60-day trading volume-weighted average stock price of our Class A common stock equals or exceeds $100 (as adjusted for stock splits, stock dividends and other similar events) on October 15, 2025, in each case subject to Mr. Martin’s continued employment through such date. In addition, in the event of a Change in Control (as defined in the Omnibus Plan) prior to October 15, 2025, the performance stock units will convert into time-based restricted stock units that will vest in their entirety on October 15, 2025, subject to Mr. Martin’s continued employment through such date. |
(9) | Amount shown is the number of time-based stock options with respect to our Class A common stock awarded on July 15, 2022, as part of Dr. Leddy’s employment agreement (the “Leddy Option”). Twenty-five percent of the Leddy Option will vest on July 15, 2023, and the remainder of the Leddy Option will vest in equal monthly installments over the following thirty-six months, subject to Dr. Leddy’s continued employment through such dates. |
(10) | Represents the date such equity award was approved by our Compensation and Nominating Committee. |
(11) | Amount shown is the number of time-based restricted stock units with respect to our Class A common stock awarded on July 15, 2022, as part of Dr. Leddy’s employment agreement. The restricted stock units will vest at a rate of one-third of the grant per year on July 15, 2023, July 15, 2024, and July 15, 2025, subject to Dr. Leddy’s continued employment through such dates. |
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Outstanding Equity Awards at Fiscal Year-End
The following table summarizes, for each of the Named Executive Officers,NEOs, the number of stock options with respect to our Class A common stock, and incentiverestricted stock units inwith respect to our Class A common stock and MLSH 1 Units held as of December 31, 2020.2022.
Name(1) | Grant date | Number of securities underlying unexercised options (#) exercisable | Number of securities underlying unexercised options (#) unexercisable | Option exercise price ($) | Option expiration date | Grant 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 (#) | Equity Incentive Plan Awards: Number of unearned shares, units or other rights that have not vested (#) | Equity Incentive Plan Awards: Market or payout value of unearned shares, units or other rights that have not vested (#)(15) | ||||||||||||||||||||||||||||||||||||||||||
Carl Hull | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 11/19/2020 | 60,000 | (2) | 27.00 | 11/19/2030 | 1/25/2022 | 31,500 | 119,700 | (2) | 26.32 | 1/25/2032 | |||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 3/18/2014 | 328,541 | 64,000 | (3) | N/A | (7) | N/A | (7) | ||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 6/20/2019 | 44,000 | 56,000 | (4) | N/A | (7) | N/A | (7) | ||||||||||||||||||||||||||||||||||||||||||||||||
Eric Tardif | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 11/19/2020 | 60,000 | (2) | 27.00 | 11/19/2030 | |||||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 3/18/2014 | 185,016 | 32,000 | (3) | N/A | (7) | N/A | (7) | ||||||||||||||||||||||||||||||||||||||||||||||||
Brian Neel | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | 1/25/2022 | 81,600 | (10) | 1,167,696 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 11/19/2020 | 60,000 | (2) | 27.00 | 11/19/2030 | 11/19/2020 | 31,250 | 28,750 | (3) | 27.00 | 11/19/2030 | |||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 12/27/2017 | 51,000 | 14,000 | (5) | N/A | (7) | N/A | (7) | 6/20/2019 | 72,000 | 28,000 | (4) | N/A | (9) | N/A | (9) | ||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 12/13/2019 | 4,000 | 16,000 | (6) | N/A | (7) | N/A | (7) | 3/18/2014 | 392,541 | — | N/A | (9) | N/A | (9) | |||||||||||||||||||||||||||||||||||||||||
William E. Martin, III | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 10/17/2022 | — | 403,946 | (5) | 19.42 | 10/17/2032 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | 10/17/2022 | 120,019 | (11) | 1,717,472 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | 10/17/2022 | 228,036 | (12) | 3,263,195 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Performance Stock Units | 10/17/2022 | 120,019 | (13) | 1,717,472 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Kevin Herde | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 1/25/2022 | 7,542 | 28,658 | (2) | 26.32 | 1/25/2032 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | 1/25/2022 | 19,500 | (10) | 279,045 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 11/19/2020 | 31,250 | 28,750 | (3) | 27.00 | 11/19/2030 | ||||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 12/13/2019 | 15,000 | 10,000 | (6) | N/A | (9) | N/A | (9) | ||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 5/30/2017 | 91,754 | — | N/A | (9) | N/A | (9) | |||||||||||||||||||||||||||||||||||||||||||||||||
Peter Leddy, Ph.D. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 7/15/2022 | — | 122,893 | (3) | 24.94 | 7/15/2032 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | 7/15/2022 | — | 63,498 | (14) | 908,656 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Brian Neel | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 1/25/2022 | 6,563 | 24,937 | (2) | 26.32 | 1/25/2032 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | 1/25/2022 | 17,000 | (10) | 243,270 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 11/19/2020 | 31,250 | 28,750 | (3) | 27.00 | 11/19/2030 | ||||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 12/13/2019 | 12,000 | 8,000 | (7) | N/A | (9) | N/A | (9) | ||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 12/27/2017 | 65,000 | — | N/A | (9) | N/A | (9) | |||||||||||||||||||||||||||||||||||||||||||||||||
Christine Dolan | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 1/25/2022 | 6,563 | 24,937 | (2) | 26.32 | 1/25/2032 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Stock Units | 1/25/2022 | 17,000 | (10) | 243,270 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options | 11/19/2020 | 31,250 | 28,750 | (3) | 27.00 | 11/19/2030 | ||||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 6/20/2019 | 9,000 | 6,000 | (4) | N/A | (9) | N/A | (9) | ||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 10/1/2018 | 12,000 | 3,000 | (8) | N/A | (9) | N/A | (9) | ||||||||||||||||||||||||||||||||||||||||||||||||
MLSH 1 Incentive Units | 12/27/2017 | 50,000 | — | N/A | (9) | N/A | (9) |
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(1) | This table reflects information regarding stock options with respect to our Class A common stock, |
(2) | Under the terms of the applicable stock option award agreement, these stock options will vest in equal installments on the 15th of every month from March 2022 through February 2026, subject to such executive’s continued employment through each vesting date. |
(3) | Under the terms of the applicable stock option award agreement, these stock options vest 25% on the first anniversary of the grant date and monthly thereafter over the next three years, subject to such executive’s continued employment through each vesting date. |
|
(4) | Under the terms of the applicable incentive unit award documentation, these incentive units will vest in equal installments on June 20 of each of |
(5) | Under the terms of the applicable |
(6) | Under the terms of the applicable incentive unit award documentation, these incentive units will vest in equal installments on December 13 of each of |
(7) | Under the terms of the applicable incentive unit award documentation, these incentive units will vest in equal installments on December 13 of each of 2023 and 2024, so long as Mr. Neel remains employed through such dates, and vesting of such incentive units accelerates upon a qualifying sale of MLSH 1. |
Under the terms of the applicable incentive unit award documentation, these incentive units will vest on October 1, 2023, so long as Ms. Dolan remains employed through such dates, and vesting of such incentive units accelerates upon a qualifying sale of MLSH 1. |
(9) | These equity awards are not traditional options and, therefore, there is no exercise price or option expiration date associated with them. |
(10) | Under the terms of the applicable restricted stock unit award agreement, these restricted stock units will vest in equal installments on February 15 of each of 2023, 2024 and 2025, subject to such executive’s continued employment through each vesting date. |
(11) | Under the terms of the applicable restricted stock unit award agreement, these restricted stock units will vest in equal installments on October 15 of each of 2023 and 2024, subject to Mr. Martin’s continued employment through each vesting date. |
(12) | Under the terms of the applicable restricted stock unit award agreement, these restricted stock units will vest in equal installments on October 15 of each of 2023, 2024 and 2025, subject to Mr. Martin’s continued employment through each vesting date. |
(13) | Under the terms of the applicable performance stock unit award agreement, 50% of the performance stock units will vest in the event the 60-day trading volume-weighted average stock price of our Class A common stock equals or exceeds $60 (as adjusted for stock splits, stock dividends and other similar events) on October 15, 2025, and the remaining fifty percent of the performance stock units will vest in the event the 60-day trading volume-weighted average stock price of our Class A common stock equals or exceeds $100 (as adjusted for stock splits, stock dividends and other similar events) on October 15, 2025, in each case subject to Mr. Martin’s continued employment through such date. |
(14) | Under the terms of the applicable restricted stock unit award agreement, these restricted stock units will vest in equal installments on July 15 of each of 2023, 2024 and 2025, subject to Dr. Leddy’s continued employment through each vesting date. |
(15) | Valuations are based on $14.31 per share, which was the last trading price for a share of our Class A common stock on the Nasdaq on December 31, 2022. |
39
Options Exercised and Stock Vested
The following table sets forth certain information with respect to the vesting of MLSH 1 Units during the fiscal year ended December 31, 2022 with respect to our NEOs. No options held by NEOs were exercised, nor did any restricted stock units vest, during the fiscal year ended December 31, 2022.
Stock Awards | ||||||||
Name | Number of Shares Acquired on Vesting (#)(1) | Value Realized on Vesting ($)(2) | ||||||
Carl Hull | 14,000 | N/A | ||||||
William E. Martin, III | — | — | ||||||
Kevin Herde | 20,000 | N/A | ||||||
Peter Leddy, Ph.D. | — | — | ||||||
Brian Neel | 11,000 | N/A | ||||||
Christine Dolan | 11,000 | N/A |
(1) | This column represents the aggregate number of MLSH 1 Units that vested in the fiscal year ended December 31, 2022, as applicable. |
(2) | These equity awards are not traditional options and, therefore, there is no immediate value realized on vesting. |
Additional Narrative Disclosure
Retirement Benefits
We do not have a defined benefit pension plan or nonqualified deferred compensation plan. We currently maintain a retirement plan intended to provide benefits under Section 401(k) of the Code, pursuant to which employees, including the Named Executive Officers,NEOs, can make voluntary pre-tax contributions. We match 50% of elective deferrals up to 6% of elective deferralsSee “Compensation Discussion and Analysis—No Special Retirement, Health or Welfare Benefits” above for all participants. These matching contributions are vested or vest based on the participant’s length of service with us, becoming fully vested on the fourth anniversary of the participant’s date of hire. All contributions under theadditional information regarding 401(k) plan are subject to certain annual dollar limitations, which are periodically adjusted for changes in the cost of living.contributions.
Employee Stock Purchase Plan
We also maintain the 2020 Employee Stock Purchase Plan (“ESPP”). The ESPP authorizes the grant of options to employees, which due to our “Up-C” structure is not currently tax-qualified under Section 423 of the Code. Each offering period is approximately twenty-four months in duration commencing on each May 1See “Compensation Discussion and November 1 of each year duringAnalysis—No Special Retirement, Health or Welfare Benefits” above for additional information regarding the term of the ESPP. The ESPP allows participants to purchase common stock through payroll deductions of up to 15% of their eligible compensation. The purchase price of the shares will be 85% of the lower of the fair market value of our common stock on the grant date or purchase date. As of December 31, 2020, no shares of common stock have been purchased under our ESPP.
Potential Payments Upon Termination or Change in Control
Each of the NEOs are party to employment agreements that provide for severance benefits (as described below), in the event the NEO’s employment is terminated by (i) the Board without “cause” or by the NEOs for “good reason” (each as defined in the employment agreements, a “Qualifying Termination”), prior to a Change in Control (as defined in the Omnibus Plan) or (ii) by the Company (or its successor) more than one year after a Change in Control. Such severance benefits are subject to each NEO’s execution and non-revocation of a general release of claims. Upon a termination for “cause” or without “good reason,” the NEO will receive any payments or benefits that have been accrued through the date of termination or are required to be paid pursuant to applicable law.
Pursuant to the Employment Agreement entered into as of November 24, 2020, as amended on September 29, 2022, between Mr. Hull, Maravai LifeSciences Holdings, Inc. and Maravai Intermediate Holdings, LLC, Mr. Hull is entitled to certain severance benefits upon a Qualifying Termination or a Change in
40
Control Termination (as defined below). Mr. Hull’s severance benefits consist of earned and unpaid annual bonus for the calendar year ending prior to the date of termination (“Earned Bonus Severance”), continued payment of base salary (the “Base Salary Severance”) for a period of 12 months plus a pro-rated target annual bonus for the fiscal year during which Mr. Hull’s termination occurs (the “Bonus Severance”), payable during the 12 month period commencing on the date of termination in substantially equal installments in accordance with regular payroll practices as in effect on the date of the termination. Additionally, Mr. Hull will receive a payment equivalent to the amount the COBRA premium would be for Mr. Hull’s health coverage prior to the termination (for Mr. Hull and Mr. Hull’s family to the extent applicable) (the “COBRA Severance”) for up to 12 months. If Mr. Hull is terminated based on a Qualifying Termination commencing upon, or up to one year following, a Change in Control (a “Change in Control Termination”), Mr. Hull will receive Earned Bonus Severance, 24 months continued Base Salary Severance plus two times the target Bonus Severance, payable during the twenty-four month period commencing on the date of termination in substantially equal installments in accordance with regular payroll practices as in effect on the date of the termination and COBRA Severance for up to 24 months.
Mr. Martin’s severance benefits consist of Earned Bonus Severance, Base Salary Severance for a period of 12 months plus Bonus Severance, payable during the 12-month period commencing on the date of termination in substantially equal installments in accordance with regular payroll practices as in effect on the date of the termination. Additionally, Mr. Martin will receive COBRA Severance for up to 12 months. If Mr. Martin is terminated based on a Change in Control Termination, Mr. Martin will receive Earned Bonus Severance, 24 months continued Base Salary Severance plus two times the target Bonus Severance, payable during the 24-month period commencing on the date of termination in substantially equal installments in accordance with regular payroll practices as in effect on the date of the termination and COBRA Severance for up to 24 months.
Mr. Herde’s severance benefits consist of Earned Bonus Severance, 12 months continued Base Salary Severance and COBRA Severance for up to 12 months. If Mr. Herde is terminated based on a Change in Control Termination, Mr. Herde’s severance benefits will consist of 12 months continued Base Salary Severance, plus the Bonus Severance and COBRA Severance for up to 12 months.
Dr. Leddy’s severance benefits consist of Earned Bonus Severance, 12 months continued Base Salary Severance and COBRA Severance for up to 12 months. If Dr. Leddy is terminated based on a Change in Control Termination, Dr. Leddy’s severance benefits will consist of Earned Bonus Severance, 12 months continued Base Salary Severance, plus the Bonus Severance and COBRA Severance for up to 12 months.
Mr. Neel’s severance benefits consist of Earned Bonus Severance, nine months continued Base Salary Severance, payable during the nine-month period commencing on the date of termination in substantially equal installments in accordance with regular payroll practices as in effect on the date of the termination and COBRA Severance for up to 12 months. If Mr. Neel is terminated based on a Change in Control Termination, Mr. Neel’s severance benefits will consist of 12 months continued Base Salary Severance and COBRA Severance for up to 12 months.
Ms. Dolan’s severance benefits consist of Earned Bonus Severance, nine months continued Base Salary Severance, payable during the nine-month period commencing on the date of termination in substantially equal installments in accordance with regular payroll practices as in effect on the date of the termination and COBRA Severance for up to 12 months. If Ms. Dolan is terminated based on a Change in Control Termination, Ms. Dolan’s severance benefits will consist of 12 months continued Base Salary Severance and COBRA Severance for up to 12 months.
No NEO shall be entitled to receive the severance benefits described above unless such NEO has timely executed and delivered within 21 calendar days of such NEO’s separation a general release and separation agreement (a “Release Agreement”) (and such Release Agreement shall become in full force and effect and not have been timely revoked as may be permitted by its terms), and such NEO shall be entitled to receive such severance benefits only so long as such NEO has not breached any of the provisions of such Release Agreement or the Non-Competition and Non-Solicitation Covenants (as defined below).
41
The employment agreements also subject the NEOs to certain restrictive covenants, including perpetual confidentiality, assignment of inventions, non-competition and non-solicitation covenants (the “Non-Competition and Non-Solicitation Covenants”). The Non-Competition and Non-Solicitation Covenants apply during each of the NEO’s employment.
Stock options and restricted stock units held by our NEOs will become 100% vested and exercisable if such NEO’s employment is terminated by us without “cause” or by the NEO for “good reason”, each as defined in the NEO’s employment agreement, within one year following a Change in Control. Furthermore, Mr. Martin’s performance stock units at target performance will convert into time-based restricted stock units that will vest in their entirety on October 15, 2025, in the event of a Change in Control prior to, and subject to Mr. Martin’s continued employment through, such date.
A Named Executive Officer’sNEO’s outstanding incentive units in MLSH 1 Units that vest based on time will become 100% vested upon a “sale” of MLSH 1, which is generally the sale of (i) MLSH 1’s equity securities pursuant to which an independent third party or parties acquires a majority of the equity securities or voting power to elect a majority of the board of directors of MLSH 1 or (ii) all or substantially all of MLSH 1’s assets on a consolidated basis.basis (a “MLSH 1 Sale”).
Stock options held byThe following table sets forth quantitative estimates of the benefits that would have accrued to each of our Named Executive Officers will become 100% vested and exercisableNEOs if such executive’sNEO’s employment ishad been terminated by us without “cause” or bycause on December 31, 2022. Amounts below reflect potential payments pursuant to the executiveemployment agreements for “good reason”, each as defined in the executive’s employment agreement, within one year following a “change in control” of the Company, as defined in our 2020 Omnibus Incentive Plansuch NEOs.
Qualifying Termination (Non-Change in Control) | Qualifying Termination (Change in Control) | Change in Control | ||||||||||||||||||||||
Name of Executive Officer | Cash Severance Benefits ($)(1) | Continued Health Benefits ($) | Cash Severance Benefits ($)(2) | Continued Health Benefits ($) | Value of Accelerated Equity Awards ($)(3) | Value of Accelerated Equity Awards ($)(4) | ||||||||||||||||||
Carl Hull | 1,450,080 | 17,207 | 2,900,160 | 34,413 | 1,167,696 | — | ||||||||||||||||||
William E. Martin, III | 1,687,500 | 21,141 | 3,375,000 | 42,282 | 8,415,611 | N/A | ||||||||||||||||||
Kevin Herde | 453,600 | 14,264 | 771,120 | 14,264 | 279,045 | — | ||||||||||||||||||
Peter Leddy, Ph.D. | 450,000 | 24,360 | 765,000 | 24,360 | 908,656 | N/A | ||||||||||||||||||
Brian Neel | 328,500 | 24,360 | 438,000 | 24,360 | 243,270 | — | ||||||||||||||||||
Christine Dolan | 329,131 | 24,360 | 438,841 | 24,360 | 243,270 | — |
(1) | Represents the potential payments upon a Qualifying Termination on December 31, 2022. |
(2) | Represents the potential payments upon a Qualifying Termination in connection with or within the one-year period following a Change in Control. |
(3) | Represents the value of accelerated vesting of restricted stock units and performance stock units that would have vested upon a Qualifying Termination in connection with or within the one-year period following a Change in Control. The exercise price of all stock options held by the NEOs exceeded the market price of our Class A common stock on December 31, 2022, and therefore such stock options would have no value if accelerated on such date. |
(4) | If a MSLH 1 Sale occurred on December 31, 2022, the NEO’s outstanding MLSH 1 Units, if any, would have accelerated and vested upon such MLSH 1 Sale. The value that would have been conferred to the NEO in connection with such MLSH 1 Sale in respect of such outstanding MLSH 1 Units, including the value attributable to payments that would have been accelerated under the Tax Receivable Agreement, is not determinable as of December 31, 2022, and therefore was excluded from the table above. |
Non-Employee Director Compensation Policy
Our Named Executive Officers’ employment agreements provide that upon a termination by us for any reason other than for “cause” or upon a resignation by such Named Executive Officer for “good reason,” each as defined therein, subject to the execution and delivery of a fully effective release of claims, as prepared by the Company, and continued compliance with applicable restrictive covenants, Mr. Hull and Mr. Tardif will receive
salary continuation payments equal to 100% of base salary, a prorated target bonus, and COBRA premium reimbursement for 12 months, and Mr. Neel will receive salary continuation payments equal to 75% of base salary and COBRA premium reimbursement for 9 months. If such conditions occur during the 12-month period following a “change in control” of the Company, as defined therein, then Mr. Hull will receive salary continuation payments equal to 200% of base salary, plus an amount equal to two times his target annual bonus, and COBRA premium reimbursement for up to 18 months, and Mr. Neel and Mr. Tardif will receive salary continuation payments equal to 100% of base salary plus, for Mr. Tardif, his target annual bonus, and COBRA premium reimbursement for up to 12 months.
The employment agreements also contain certain restrictive covenants, including provisions that create restrictions, with certain limitations, on our Named Executive Officers competing with Maravai and its subsidiaries during the term of the Named Executive Officer’s employment with the Company and soliciting any customers or other business relations or soliciting or hiring employees of Maravai and its subsidiaries, in each case, during the term of the Named Executive Officer’s employment with the Company and for the one-year period following termination of employment.
Non-Employee Director Compensation Policy
Prior to the IPO, we did not have a formal policy with respect to compensating our non-employee directors for service as directors. Prior to the IPO, each of Messrs. Hance, Lucier and Prahalad was subject to an investment and director compensation agreement with MLSH 1, pursuant to which they have been granted restricted incentive units in MLSH 1 and were entitled to director fees ($10,000 per meeting attended in person and $5,000 per meeting attended telephonically) and reimbursement of expenses incurred in connection with their service.
Since the completion of the IPO, our non-employee directors have beenare eligible to receive the annual cash retainers listed below for their service on ourthe Board and committees of the Board. The non-employeeNon-employee directors who are employees of GTCR or its affiliates
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have agreed or are otherwise obligated to transfer all or a portion of the cash compensation they receive for their service as directors to GTCR or its affiliates. The retainers will beare paid in arrears in four equal quarterly installments and prorated for any partial year of service on our board of directors.the Board.
Retainer ($) | ||||||||
Position | Prior to 10/1/2022 | Effective 10/1/2022 to Present | ||||||
Board Member | 40,000 | 60,000 | ||||||
Audit Committee: | ||||||||
Chair | 20,000 | 25,000 | ||||||
Committee Member | 10,000 | 12,500 | ||||||
Compensation and Leadership Development Committee: (1) | ||||||||
Chair | N/A | 20,000 | ||||||
Committee Member | N/A | 10,000 | ||||||
Nominating, Governance and Risk Committee: (1) | ||||||||
Chair | N/A | 15,000 | ||||||
Committee Member | N/A | 7,500 | ||||||
Compensation and Nominating Committee: (1) | ||||||||
Chair | 25,000 | N/A | ||||||
Committee Member | 12,500 | N/A |
(1) | ||||
| ||||
The Board | ||||
| ||||
| ||||
| ||||
separated the Compensation and Nominating | ||||
| ||||
Committee’s duties and responsibilities into two separate committees, the Compensation and Leadership Development Committee |
None of our non-employee directors received equity awards in 2022. Rather, our Non-Employee Director Compensation Policy provides that our non-employee directors will receive a grant of RSUs pursuant to the Omnibus Plan with a fair market value on the date of grant equal to approximately $300,000 beginning in 2023, and that for 2024 and each year beyond, each non-employee director will receive an annual RSU grant pursuant to the Omnibus Plan with a fair market value on the date of grant equal to approximately $200,000. The RSUs granted annually vest in full on the first anniversary of the date of grant, subject to the respective non-employee director’s continued service on the Board through such anniversary date. In the event a new non-employee director is elected or appointed to the Board, such non-employee director will receive an RSU grant pursuant to the Omnibus Plan with a fair market value on the date of grant equal to approximately $400,000 for their first year of service on the Board. The RSUs granted upon a director’s election or appointment vest in three equal installments on the first three anniversaries of the date of grant, subject to such non-employee director’s continued service on the Board through each such anniversary date.
All non-employee directors are also reimbursed for their reasonable expenses to attend meetings of ourthe Board and related committees and otherwise attend to our business.
The following table presents the total compensation for each person who served as a non-employee member of ourthe Board during 2020.2022. Other than as set forth in the table and described more fully below, we did not pay any cash or other compensation, reimburse any expense of, makeor grant any equity awards or non-equity awards to, or pay any other compensation to, any of the other non-employee members of ourthe Board in 2020.2022. Mr. Hull, our interim Chief Executive Officer and Executive Chairman of the Board, receives no additional compensation for service as a director and, consequently, is not included in this table. The compensation received by Mr. Hull as an employee of the Company is presented in “—Summary Compensation Table.” No equity awards were granted to any of our non-employee directors in the fiscal year ended December 31, 2022.
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Director Compensation
Name | Fees earned or paid in cash ($)(1) | Stock awards ($)(2) | Total ($) | Fees earned or paid in cash ($)(1) | Total ($) | |||||||||||||||
Anat Ashkenazi | 5,770 | 320,004 | 325,774 | 60,625 | 60,625 | |||||||||||||||
Sean Cunningham | 4,616 | — | 4,616 | 46,875 | 46,875 | |||||||||||||||
Benjamin Daverman | 6,058 | — | 6,058 | 54,375 | 54,375 | |||||||||||||||
Susannah Gray | 6,924 | 320,004 | 326,928 | 68,750 | 68,750 | |||||||||||||||
Robert B. Hance | 4,616 | 320,004 | 324,620 | 45,000 | 45,000 | |||||||||||||||
Jessica Hopfield(3) | 7,212 | 320,004 | 327,216 | |||||||||||||||||
Jessica Hopfield, Ph.D. (2) | 68,750 | 68,750 | ||||||||||||||||||
Gregory T. Lucier(3) | 4,616 | 320,004 | 324,620 | 45,000 | 45,000 | |||||||||||||||
Luke Marker | 4,616 | — | 4,616 | 45,000 | 45,000 | |||||||||||||||
Constantine Mihas | 7,500 | — | 7,500 | 66,250 | 66,250 | |||||||||||||||
Murali K. Prahalad(5) | 4,616 | 320,004 | 324,620 | |||||||||||||||||
Murali K. Prahalad, Ph.D. (2) | 46,875 | 46,875 |
(1) | The amounts in this column represent the |
(2) |
|
As of December 31, |
As of December 31, |
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CHIEF EXECUTIVE OFFICER PAY RATIO
Under Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K, we are required to provide the ratio of the annual total compensation of Mr. Hull, to the annual total compensation of the median employee of the Company.
For the fiscal year ended December 31, 2022:
The annual total compensation of the median employee was $116,271;
The annual total compensation of our Chief Executive Officer was $5,480,801; and
The estimated ratio of the annual total compensation of our Chief Executive Officer to the median annual total compensation of all other employees was 47.1 to 1.
This pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on the methodology described below. The SEC rules for identifying the median compensated employee and calculating the pay ratio allow companies to adopt a variety of methodologies, apply certain exclusions, and make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios.
Methodology
We used December 31, 2022, the end of our most recent fiscal year, as the date to determine the median employee (the “Determination Date”). The median compensated employee was determined by utilizing a consistently applied compensation measure based on the gross pay reflected on the 2022 IRS Form W-2 for each employee of the Company (“Gross Pay”). For each employee that was hired in 2022, and therefore their Gross Pay as of December 31, 2022 did not reflect a full year’s pay, we annualized their wages and/or salary, deducting from their Gross Pay and not including in such annualized amount any income attributable to: (i) cash bonuses paid to such employee throughout the year, (ii) the purchase of shares of our Class A common stock pursuant to our ESPP, (iii) the vesting of RSUs, and (iv) the exercise of stock options, all of which are already included in Gross Pay and not indicative of annual salary or wages.
Using this approach, we identified our median employee and then calculated the annual total compensation of this employee for 2022 in accordance with the requirements of the Summary Compensation Table.
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Year | Summary Compensation Table Total for PEO (1) | Summary Compensation Table Total for Former PEO (1) | Compensation Actually Paid to PEO (1)(2) | Compensation Actually Paid to Former PEO (1)(2) | Average Summary Compensation Table Total for Non-PEO NEOs (3) | Average Compensation Actually Paid to Non-PEO NEOs (3)(2) | Value of Initial Fixed $100 Investment Based On: | Net Income (in millions) (5) | Revenue (in millions) (6) | |||||||||||||||||||||||||||||||
Total Shareholder Return (4) | Peer Group Total Shareholder Return (4) | |||||||||||||||||||||||||||||||||||||||
2022 | $ | 5,480,801 | 14,523,493 | $ | 3,044,254 | (7) | $ | 10,261,539 | (7) | $ | 2,210,185 | $ | 1,016,657 | (7) | $ | 47.94 | $ | 96.54 | $ | 490.7 | $ | 883.0 | ||||||||||||||||||
2021 | $ | 1,780,769 | N/A | $ | 2,320,597 | (8) | N/A | $ | 1,233,692 | $ | 966,436 | (8) | $ | 140.37 | $ | 108.36 | $ | 469.3 | $ | 799.2 | ||||||||||||||||||||
2020 | $ | 2,124,160 | N/A | $ | 2,054,480 | (9) | N/A | $ | 1,878,805 | $ | 1,809,125 | (9) | $ | 93.97 | $ | 109.05 | $ | 78.8 | $ | 284.1 |
(1) | Mr. Hull is the Company’s Principal Executive Officer (“PEO”) for 2020, 2021 and 2022. Mr. Martin is the Company’s former Principal Executive Officer (“Former PEO”) for 2022. |
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(3) | The names of each of the non-PEO NEOs reflected in these columns for each applicable fiscal year are as follows: (i) for 2022, Messrs. Herde, and Neel, Dr. Leddy, and Ms. Dolan; (ii) for 2021, Messrs. Herde, Neel, and Oreshack, Ms. Dolan and Lisa Sellers; and (iii) for 2020, |
(4) | The Company TSR and the Company’s Peer Group TSR reflected in these columns for each applicable fiscal year is calculated based on S-K. The first day of trading of our Class A common stock was November 20, 2020. The Peer Group TSR represents TSR of the Nasdaq Biotechnology Index, which S-K. |
(5) | Represents the amount of net income reflected in |
(6) | We have selected revenue as reflected in the Company’s audited GAAP financial statements for each applicable fiscal year (“Revenue”) as our most important financial measure (that is not otherwise required to be disclosed in the table) used to link ‘compensation actually paid’ to our NEOs to company performance for 2022. |
(7) | For 2022, the ‘compensation actually paid’ to the PEO and the average ‘compensation actually paid’ to the non-PEO NEOs reflect each of Regulation S-K: |
PEO | Former PEO | Average Non-PEO NEOs | ||||||||||
Total Compensation Reported in 2022 Summary Compensation Table | $ | 5,480,801 | $ | 14,523,493 | $ | 2,210,185 | ||||||
Less, Grant Date Fair Value of Stock & Option Awards Reported in the 2022 Summary Compensation Table | ($ | 4,027,128 | ) | ($ | 12,453,877 | ) | ($ | 1,451,920 | ) | |||
Plus, Year-End Fair Value of Awards Granted in 2022 that are Outstanding and Unvested | $ | 1,882,904 | $ | 8,191,923 | $ | 720,140 | ||||||
Plus, Change in Fair Value of Awards Granted in Prior Years that are Outstanding and Unvested (From Prior Year-End toYear-End) | $ | (538,516 | ) | $ | — | $ | (403,887 | ) | ||||
Plus, Vesting Date Fair Value of Awards Granted in 2022 that Vested in 2022 | $ | 413,853 | $ | — | $ | 67,884 | ||||||
Plus, Change in Fair Value of Awards Granted in Prior Years that Vested in 2022 (From Prior Year-End to Vesting Date) | ($ | 167,660 | ) | $ | — | ($ | 167,660 | ) | ||||
Less, Prior Year-End Fair Value of Awards Granted in Prior Years that Failed to Vest in 2022 | ($ | — | ) | ($ | — | ) | ($ | — | ) | |||
Plus, Dollar Value of Dividends or other Earnings Paid on Stock & Option Awards in 2022 prior to Vesting (if not reflected in the fair value of such award or included in Total Compensation for 2022) | $ | — | $ | — | $ | — | ||||||
Total Adjustments | ($ | 2,436,547 | ) | ($ | 4,261,954 | ) | $ | (1,193,527 | ) | |||
Compensation Actually Paid for 2022 | $ | 3,044,254 | $ | 10,261,539 | $ | 1,016,657 |
(8) | For 2021, non-PEO NEOs reflect each of the following adjustments made to the total compensation amounts reported in the Summary Compensation Table for 2021, computed in accordance with Item 402(v) ofRegulation S-K: |
PEO | Average Non-PEO NEOs | |||||||
Total Compensation Reported in 2021 Summary Compensation Table | $ | 1,780,769 | $ | 1,233,692 | ||||
Less, Grant Date Fair Value of Stock & Option Awards Reported in the 2021 Summary Compensation Table | ($ | — | ) | ($ | 488,298 | ) | ||
Plus, Year-End Fair Value of Awards Granted in 2021 that are Outstanding and Unvested | $ | — | $ | — | ||||
Plus, Change in Fair Value of Awards Granted in Prior Years that are Outstanding and Unvested (From Prior Year-End toYear-End) | $ | 431,288 | $ | 316,278 | ||||
Plus, Vesting Date Fair Value of Awards Granted in 2021 that Vested in 2021 | $ | — | $ | — | ||||
Plus, Change in Fair Value of Awards Granted in Prior Years that Vested in 2021 (From Prior Year-End to Vesting Date) | $ | 108,540 | $ | 79,595 | ||||
Less, Prior Year-End Fair Value of Awards Granted in Prior Years that Failed to Vest in 2021 | ($ | — | ) | ($ | 174,832 | ) | ||
Plus, Dollar Value of Dividends or other Earnings Paid on Stock & Option Awards in 2021 prior to Vesting (if not reflected in the fair value of such award or included in Total Compensation for 2021) | $ | — | $ | — | ||||
Total Adjustments | $ | 539,828 | ($ | 267,257 | ) | |||
Compensation Actually Paid for 2021 | $ | 2,320,597 | $ | 966,436 |
(9) | For 2020, the ‘compensation actually paid’ to the PEO and the average ‘compensation actually paid’ to the non-PEO NEOs reflect each of the following adjustments made to the total compensation amounts reported in the Summary Compensation Table for 2020, computed in accordance with Item 402(v) ofRegulation S-K: |
PEO | Average Non-PEO NEOs | |||||||
Total Compensation Reported in 2020 Summary Compensation Table | $ | 2,124,160 | $ | 1,878,805 | ||||
Less, Grant Date Fair Value of Stock & Option Awards Reported in the 2020 Summary Compensation Table | ($ | 874,160 | ) | ($ | 874,160 | ) | ||
Plus, Year-End Fair Value of Awards Granted in 2020 that are Outstanding and Unvested | $ | 804,480 | $ | 804,480 | ||||
Plus, Change in Fair Value of Awards Granted in Prior Years that are Outstanding and Unvested (From Prior Year-End toYear-End) | $ | — | $ | — | ||||
Plus, Vesting Date Fair Value of Awards Granted in 2020 that Vested in 2020 | $ | — | $ | — | ||||
Plus, Change in Fair Value of Awards Granted in Prior Years that Vested in 2020 (From Prior Year-End to Vesting Date) | $ | — | $ | — | ||||
Less, Prior Year-End Fair Value of Awards Granted in Prior Years that Failed to Vest in 2020 | ($ | — | ) | ($ | — | ) | ||
Plus, Dollar Value of Dividends or other Earnings Paid on Stock & Option Awards in 2020 prior to Vesting (if not reflected in the fair value of such award or included in Total Compensation for 2020) | $ | — | $ | — | ||||
Total Adjustments | ($ | 69,680 | ) | ($ | 69,680 | ) | ||
Compensation Actually Paid for 2020 | $ | 2,054,480 | $ | 1,809,125 |
Most Important Performance Measures |
Revenue |
Adjusted EBITDA |
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Policies for Approval of Related Party Transactions
We have adopted a written policy with respect to the review, approval and ratification of related party transactions. Under the policy, our Audit Committee is responsible for reviewing and approving related party transactions. In the course of its review and approval of related party transactions, our Audit Committee will consider the relevant facts and circumstances to decide whether to approve such transactions. In particular, our policy requires our Audit Committee to consider, among other factors it deems appropriate:
the related person’s relationship to us and interest in the transaction;
the material facts of the proposed transaction, including the proposed aggregate value of the transaction;
the impact on a director’s independence in the event the related person is a director or an immediate family member of the director;
the benefits to us of the proposed transaction;
if applicable, the availability of other sources of comparable products or services; and
an assessment of whether the proposed transaction is on terms that are comparable to the terms available to an unrelated third party or to employees generally.
The Audit Committee may only approve those transactions that are in, or are not inconsistent with, our best interests and those of our shareholders, as the Audit Committee determines in good faith.
In addition, under our Code of Ethics our employees and directors will have an affirmative responsibility to disclose any transaction or relationship that reasonably could be expected to give rise to a conflict of interest.
All of the transactions described below were entered into in compliance with our Related Party Transactions Policy, except for those entered into prior to the adoption of such policy, which were approved by the Board considering similar factors to those described above.
Related Party Transactions
Other than compensation arrangements for our directors and named executive officers,NEOs, which are described in the section entitled “Executive Compensation”, below we describe transactions during the fiscal year ended December 31, 2020since January 1, 2022, to which we were a participant or will be a participant, in which:
the amounts involved exceeded or will exceed $120,000; and
any of our directors, executive officers, or holders of more than 5% of our capital stock, or any member of the immediate family of, or person sharing the household with, the foregoing persons, had or will have a direct or indirect material interest.
Amended and Restated Operating Agreement
In connection with the completion of the IPO, we amended and restated Maravai Topco Holdings, LLC’s (“Topco LLC”) operating agreement, which we refer to as the “LLC Operating Agreement.” The operations of Topco LLC and the rights and obligations of the LLC Unitholders are set forth in the LLC Operating Agreement.
Tax Receivable Agreement
We are party to a Tax Receivable Agreement with MLSH 1 and MLSH 2 (the “TRA”) that provide for the payment from time to time by us to MLSH 1 and MLSH 2, collectively, of 85% of the amount of the benefits, if any, that we realize or, under certain circumstances, are deemed to realize as a result of (i) certain increases in the tax basis of assets of Maravai Topco Holdings, LLC (“Topco LLC”) and its subsidiaries resulting from purchases or exchanges of Topco LLC Units (“LLC Units”), (ii) certain tax
attributes of the Blocker Entities, Topco LLC and subsidiaries of Topco LLC that existed prior to this offering and (iii) certain other tax benefits related to our
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entering into the Tax Receivable Agreement, including tax benefits attributable to payments that we make under the Tax Receivable Agreement. These payment obligations are obligations of Maravai LifeSciences Holdings, Inc. and not of Topco LLC. NoWe made payments were madeof $35.3 million under the Tax Receivables Agreement during the fiscal year ended December 31, 2020.2022. As of December 31, 2022, our liabilities under the TRA were $718.2 million.
Exchange Agreement
We are party to an Exchange Agreement with MLSH 1 pursuant to which MLSH 1 is entitled to exchange LLC Units, together with an equal number of shares of Class B common stock, for shares of Class A common stock on a one-for-one basis or, at our election, for cash, from a substantially concurrent public offering or private sale (based on the price of our Class A common stock in such public offering or private sale).
Director Nomination Agreement
For more information on the Director Nomination Agreement that we are party to with GTCR, see the section of this proxy statement titled “Board of Directors and Corporate Governance—Director Nomination Agreement.” SeanMessrs. Cunningham, Benjamin Daverman, Luke Marker and Constantine Mihas, four of our current directors, are employed as a Managing Director, Managing Director, Principal, and Co-CEO and Managing Director, respectively, of GTCR.
Registration Rights Agreement
We are a party to a registration rights agreement with MLSH 1 and MLSH 2. MLSH 1 and MLSH 2 are entitled to request that we register their shares of capital stock on a long-form or short-form registration statement on one or more occasions in the future, which registrations may be “shelf registrations.” MLSH 1 and MLSH 2 will be entitled to participate in certain of our registered offerings, subject to the restrictions in the registration rights agreement. We will pay expenses in connection with the exercise of these rights. The registration rights described in this paragraph apply to (1) shares of our Class A common stock held by MLSH 1 and MLSH 2 and their affiliates, and (2) any of our capital stock (or that of our subsidiaries) issued or issuable with respect to the Class A common stock described in clause (1) with respect to any dividend, distribution, recapitalization, reorganization, or certain other corporate transactions (“Registrable Securities”). These registration rights are also for the benefit of any subsequent holder of Registrable Securities; provided that any particular securities will cease to be Registrable Securities when they have been sold in a registered public offering, sold in compliance with Rule 144 of the Securities Act of 1933, as amended (the “Securities Act”) or repurchased by us or our subsidiaries. In addition, with the consent of the company and holders of a majority of Registrable Securities, certain Registrable Securities will cease to be Registrable Securities if they can be sold without limitation under Rule 144 of the Securities Act.
Indemnification of Officers and Directors
We are party to indemnification agreements with each of our officers, directors and director nominees. The indemnification agreements provide the officers and directors with contractual rights to indemnification, expense advancement and reimbursement, to the fullest extent permitted under Delaware law. Additionally, we may enter into indemnification agreements with any new directors or officers that may be broader in scope than the specific indemnification provisions contained in Delaware law. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our officers and directors pursuant to the foregoing agreements, we have been advised that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act, and is therefore unenforceable.
Relationship with GTCRTopco LLC Operating Agreement
We previously utilized GTCR, who controlsMLSH 1 is party to the vote of all matters submitted to a vote of our stockholders, for certain services pursuant to an advisory services agreement. Under theTopco LLC operating agreement GTCR provided us with
financial and management consulting servicesput in the areas of corporate strategy, budgeting for future corporate investments, acquisition and divestiture strategies and debt and equity financings. We paid a $0.1 million quarterly management fee to GTCR for these services. We also reimbursed GTCR for out-of-pocket expenses incurred while providing these services. The advisory services agreement also required that we pay placement fees to GTCR of 1.0% of the gross amount of any debt or equity financings, including the IPO. The advisory services agreement terminatedplace in connection with the IPO.
We paid GTCR $4.2 million, $0.5 million, and $0.5 million in each of the years ended December 31, 2020, 2019, and 2018, respectively, for services in connection with the advisory services agreement. We may continueour initial public offering. This agreement includes a provision requiring cash distributions enabling its owners to engage GTCRpay their taxes on income passing through from time to time, subject to compliance with our related party transactions policy.
Topco LLC. During the fiscal year ended December 31, 2018, $52.02022, the Company made distributions of $150.2 million for tax liabilities to MLSH 1 under this agreement.
Contract Development and Manufacturing Agreement with Curia Global
GTCR and the investment funds it manages have majority or controlling ownership interests in a broad range of capital distributions were made to certain legacy unit holders of MLSC Holdings, LLC (“MLSC”),companies. During the parent entity of Cygnus, including GTCR. The 2018 distribution was treated as a preferred return of capital per the terms of the MLSC limited liability company agreement. There were no such distributions made during thefiscal year ended December 31, 2019. A tax distribution2022, the Company paid approximately
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$339,000 to Curia Global, a leading contract research, development and manufacturing organization for which GTCR exercises significant control, for contract manufacturing and development services. In the ordinary course of $0.3 million was made toour business, we contract with CDMOs for the non-controlling interest holdersproduction of MLSC duringantigen via cell culture, and believe that the terms on which we procured these services were at market competitive rates.
Purchases from Cole-Parmer Instrument Co.
During the fiscal year ended December 31, 2020.2022, the Company paid approximately $675,000 to Cole-Parmer Instrument Company (“Cole-Parmer”), a leading global manufacturer of lab instrumentation, equipment, and supplies and consumables, for products used in Maravai’s manufacturing processes. Cole-Parmer is a subsidiary of Antylia Scientific (f/k/a Cole Parmer), for which GTCR exercises significant control. In the ordinary course of our business, we contract with of lab instrumentation, equipment, and supplies and consumables, and believe that the terms on which we procured these products were at market competitive rates.
In October 2020, we paid GTCRContribution and Exchange Agreement; Forfeiture Agreement
On January 18, 2023, the Company acquired all of the outstanding membership interests in Alphazyme LLC (“Alphazyme”). On January 19, 2023, the Company entered into a placement feeContribution Agreement with Alphazyme Holdings, Inc., a wholly owned subsidiary of $3.7 millionthe Company (“Alphazyme Holdings”), pursuant to which the Company contributed all such membership interests in connectionAlphazyme (the “Alphazyme Membership Interest”) to Alphazyme Holdings. On January 22, 2023, Alphazyme Holdings entered into a Contribution and Exchange Agreement with our entry into our new Credit Agreement dated October 19, 2020.
Payments made to and from MLSH 1 and MLSH 2 in Connection with the IPO
In November 2020, we received net proceeds of approximately $1.8 billion after deducting underwriting discounts and commissions from our IPO, of which $1.5 billion was used to purchase 59,526,715 of LLC units in Topco LLC, from MLSH 1, $208.1 millionpursuant to which it contributed all of the Alphazyme Membership Interests to Topco LLC in exchange for 5,059,134 newly-issued LLC Units of Topco LLC at a price per unit of $13.87, which was usedequal to pay MLSH 2 as consideration for certain mergers related to various reorganizational transactions effected in connection with our IPO, and $33.7 million was used to acquire 1,319,148 outstanding sharesthe 50-day volume-weighted average price of the Company’s Class A common stock fromas calculated on January 18, 2023 (the “Contribution and Exchange”). Immediately following the Contribution and Exchange, the Company entered into a Forfeiture Agreement with Alphazyme Holdings, Topco LLC and MLSH 2.
In addition, in connection1, a related party, pursuant to which each of the Company (together with Alphazyme Holdings) and MLSH 1 agreed to forfeit 5,059,134 and 4,871,970 LLC Units, respectively, representing 3.7% of the various reorganizational transactions effected in connectionCompany’s (together with our IPO, we soldAlphazyme Holdings) and MLSH 1’s respective LLC Units of Topco LLC, and an equal number of shares of the Company’s Class B common stock, topar value $0.01 per share, were forfeited by MLSH 1, in each case for $1.7 millionno consideration. The Company’s acquisition of Alphazyme allowed the Company to utilize excess cash that had accumulated as a result of quarterly tax distributions it has received from Topco LLC. The Contribution and made capital distributions of $88.6 millionExchange Agreement enabled the Company to contribute Alphazyme to Topco LLC where the Company’s other business segments reside, to align with our business objectives in a structurally and tax distributions of $8.2 million to MLSH 1 for the year ended December 31, 2020.efficient manner.
Lease Arrangements
Cygnus Technologies, a subsidiary of MLSC, has an ongoing lease agreement for facilities in Southport, NC with an entity controlled by a close relative of the president of Cygnus Technologies. The close relative was also previously an employee of Cygnus Technologies who terminated their employment during the year ended December 31, 2018. The president of Cygnus Technologies also personally financed a loan to this entity, which was used to acquire the property leased by Cygnus Technologies. The lease terms are considered to be consistent with market rates.
Cygnus Technologies paid $0.2 million of rent under this lease agreement for each of the years ended December 31, 2020, 2019 and 2018.
Noncontrolling Interests
The noncontrolling interests in MLSC, the parent of Cygnus Technologies, represents equity interest that was retained by the unit holders of the MLSC entity prior to its acquisition by Maravai. The president of Cygnus Technologies and his affiliated entity are the holders of the noncontrolling interests.55
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information about the beneficial ownership of our Class A common stock and our Class B common stock as of March 31, 202121, 2023 for:
each person or group known to us who beneficially owns more than 5% of our Class A common stock or our Class B common stock;
each of our directors;
each of our Named Executive Officers;NEOs; and
all of our directors and executive officers as a group.
The numbersEach shareholder’s percentage of beneficial ownership is based on 131,788,743 shares of our Class A common stock and Class B common stock (together with the same amount of LLC Units) beneficially owned and percentages of beneficial ownership are based on based on 96,646,515119,094,026 shares of Class A common stock and 160,974,129 shares ofour Class B common stock outstanding as of March 31, 2021.21, 2023. This number excludes 160,974,129119,094,026 shares of Class A common stock issuable in exchange for LLC Units and upon conversion of shares of our Class B common stock, each as described under “Certain Relationships and Related Party Transactions—Amended and Restated Operating Agreement.” If all outstanding LLC Units were exchanged and all outstanding shares of Class B common stock were converted, we would have 257,620,644250,882,769 shares of Class A common stock outstanding as of March 31, 2021.21, 2023.
Beneficial ownership for the purposes of the following table is determined in accordance with the rules and regulations of the SEC. These rules generally provide that a person is the beneficial owner of securities if such person has or shares the power to vote or direct the voting thereof, or to dispose or direct the disposition thereof or has the right to acquire such powers within 60 days. CommonShares of our common stock subject to options or restricted stock units (“RSUs”) that are currently exercisable or exercisable within 60 days of March 21, 2023, and/or willshares underlying RSUs that are scheduled to vest within 60 days of March 31, 202121, 2023, are deemed to be outstanding and beneficially owned by the person holding the options or RSUs. These shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person. Except as disclosed in the footnotes to this table and subject to applicable community property laws, we believe that each shareholder identified in the table possesses sole voting and investment power over all shares of our common stock shown as beneficially owned by the shareholder.
Unless otherwise noted below, the address of each beneficial owner listed on the table is c/o Maravai LifeSciences Holdings, Inc., 10770 Wateridge Circle Suite 200, San Diego, California, 92121. Beneficial ownership representing less than 1% is denoted with an asterisk (*).
Shares Beneficially Owned | Shares Beneficially Owned | |||||||||||||||||||||||||||||||||||
Class A Common Stock(1) | Class B Common | Class A Common Stock (1) | Class B Common Stock (1) | |||||||||||||||||||||||||||||||||
Name of Beneficial Owner | Shares | % | Shares | % | Voting % | Shares | % | Shares | % | Voting% | ||||||||||||||||||||||||||
GTCR(2) | 27,646,515 | 28.61 | % | 160,974,129 | 100 | % | 73.22 | % | 21,681,033 | 16.45 | % | 119,094,026 | 100 | % | 56.11 | % | ||||||||||||||||||||
FMR LLC(3) | 5,706,561 | 5.90 | % | — | — | 2.22 | % | |||||||||||||||||||||||||||||
Massachusetts Financial Services Company(3) | 13,047,960 | 9.90 | % | — | — | 5.20 | % | |||||||||||||||||||||||||||||
Vanguard Group Inc.(4) | 4,713,452 | 4.88 | % | — | — | 1.83 | % | 10,389,979 | 7.88 | % | — | — | 4.14 | % | ||||||||||||||||||||||
D1 Capital Partners L.P.(5) | 5,930,000 | 6.14 | % | — | — | 2.30 | % | |||||||||||||||||||||||||||||
Named Executive Officers and Directors | ||||||||||||||||||||||||||||||||||||
Carl Hull | 35,000 | * | — | — | * | |||||||||||||||||||||||||||||||
Eric Tardif | — | — | — | — | — | |||||||||||||||||||||||||||||||
Brian Neel | — | — | — | — | — | |||||||||||||||||||||||||||||||
Carl Hull (5) | 148,485 | * | — | — | * | |||||||||||||||||||||||||||||||
Kevin Herde (6) | 60,454 | * | — | — | * | |||||||||||||||||||||||||||||||
Brian Neel (7) | 52,484 | * | — | — | * | |||||||||||||||||||||||||||||||
Christine Dolan (8) | 57,423 | * | — | — | * | |||||||||||||||||||||||||||||||
William E. Martin, III | — | * | — | — | * | |||||||||||||||||||||||||||||||
Peter Leddy, Ph.D. (9) | 5,958 | * | — | — | * | |||||||||||||||||||||||||||||||
Anat Ashkenazi | 11,852 | * | — | — | * | 12,623 | * | — | — | * | ||||||||||||||||||||||||||
Sean Cunningham | — | — | — | — | — | 4,721 | — | — | — | — | ||||||||||||||||||||||||||
Benjamin Daverman | — | — | — | — | — | 4,721 | — | — | — | — | ||||||||||||||||||||||||||
Susannah Gray | 31,852 | * | — | — | * | 32,623 | * | — | — | * | ||||||||||||||||||||||||||
Robert B. Hance | 21,852 | * | — | — | * | 22,623 | * | — | — | * | ||||||||||||||||||||||||||
Jessica Hopfield | 61,852 | * | — | — | * | |||||||||||||||||||||||||||||||
Jessica Hopfield, Ph.D. | 62,623 | * | — | — | * | |||||||||||||||||||||||||||||||
Gregory T. Lucier | 26,852 | * | — | — | * | 27,623 | * | — | — | * | ||||||||||||||||||||||||||
Luke Marker | — | — | — | — | — | 4,721 | — | — | — | — | ||||||||||||||||||||||||||
Constantine Mihas | — | — | — | — | — | 4,721 | — | — | — | — | ||||||||||||||||||||||||||
Murali K. Prahalad | 29,852 | * | — | — | * | |||||||||||||||||||||||||||||||
All executive officers and directors as a group (17 individuals) | 271,888 | * | — | — | * | |||||||||||||||||||||||||||||||
Murali K. Prahalad, Ph.D. | 17,323 | * | — | — | * | |||||||||||||||||||||||||||||||
All executive officers and directors as a group (17 individuals) (10) | 557,171 | * | — | — | * |
(1) | Each share of our Class A common stock and our Class B common stock entitles the registered holder thereof to one vote |
(2) | Represents |
(3) | Based upon information reported by way of a Schedule 13G filed by |
(4) | Based upon information reported by way of a Schedule |
(5) |
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(6) | Includes 54,771 shares issuable on |
(7) | Includes 47,344 shares issuable on exercise of |
(8) | Includes 51,927 shares issuable on exercise of options currently exercisable or exercisable within 60 days. |
(9) | Includes 5,958 shares issuable on exercise of options exercisable within 60 days. |
(10) | Includes 50,668 shares held |
PROPOSAL 2—ADVISORY VOTE REGARDING RETENTION OF THE CLASSIFIED STRUCTURE OF OUR BOARD
Background of the Proposal
In accordance with our Certificate, and as permitted under the General Corporation Law of the State of Delaware (the “DGCL”), our Board is divided into three classes. Our current classified Board structure has been in place since our IPO. At each annual meeting of shareholders, commencing with this 2021 Annual Meeting, each director is elected to serve a term of three years, with each director’s term expiring at the third succeeding annual meeting of shareholders held after the director’s election. The directors designated as Class I have terms expiring at the 2021 Annual Meeting; the directors designated as Class II have terms expiring at the 2022 annual meeting of shareholders; and the directors designated as Class III have terms expiring at the 2023 annual meeting of shareholders.
At the time of our IPO, the Board believed that a classified Board structure was an important piece of the Company’s governance structure in order to promote continuity and stability, and was in the best interests of the Company and its shareholders. The Board also believed that the classified Board structure would protect the Company against unfair or abusive takeover practices following the IPO and, given the nature of the Company (as discussed in more detail below), protect the long-term value of the Company. At the same time, the Board recognized that some investors may view classified boards as having the effect of reducing the accountability of directors to shareholders because classified boards limit the ability of shareholders to elect all directors on an annual basis. Accordingly, at this Annual Meeting, the Company is asking our shareholders to vote, on an advisory basis, whether to retain the classified Board structure.
If this proposal is approved by the holders of a majority of shares of the Company’s common stock voting on the proposal at the Annual Meeting, then the Company will retain a classified Board. However, if a majority of shares of the Company’s common stock voting on the proposal at the Annual Meeting vote against the proposal, then this proposal would not by itself declassify or begin the declassification of the Board. Instead, rejection of the proposal would only advise the Board that a majority of our shareholders voting at the Annual Meeting desire to end the classified Board structure. Consistent with its fiduciary duties, if shareholders vote against this proposal, the Board will reevaluate its position with respect to our classified Board structure. This reevaluation would include considering the percentage of shareholders voting against this proposal. An affirmative vote of not less than 50% of the then outstanding shares of the Company entitled to vote at a duly held meeting is required to amend our Certificate to declassify the Board (or 66 2⁄3% if GTCR owns, in the aggregate, less than 50% in voting power of the stock of the Company entitled to vote generally in the election of directors). If shareholders representing less than 50% of outstanding common stock reject this proposal, then the Board will likely not take additional steps to declassify the Board.
If a majority of our shareholders vote against this proposal and the Board determines that the declassification of the Board is in the best interests of the Company and its shareholders, then the Board will include a proposal in the proxy statement for the 2022 annual meeting of shareholders to amend the Certificate to declassify the Board. An amendment to the Certificate must first be approved by the Board and then approved by the affirmative vote of not less than 50% of the then outstanding shares of the Company entitled to vote at a duly held meeting (or 66 2⁄3% if GTCR owns, in the aggregate, less than 50% in voting power of the stock of the Company entitled to vote generally in the election of directors).
The amendment to the Certificate would provide for the phased-in elimination of the classified structure of the Board over a three-year period commencing with the 2023 annual meeting of shareholders. To comply with Delaware law, the amendment of the Certificate would not change the unexpired three-year terms of directors elected prior to the effectiveness of the amendment (including directors elected at the 2021 and 2022 annual meetings of shareholders). This would result in the Board being fully declassified (and all Board members standing for annual elections) commencing with the 2025 annual meeting of shareholders.
Starting at the 2023 annual meeting of shareholders, directors would be elected to one-year terms, and until their successors are duly elected and qualified. Therefore, beginning with the 2025 annual meeting of shareholders, the entire Board would stand for election.
Additionally, under Delaware law, unless otherwise provided in a company’s certificate of incorporation, directors serving on a classified board may only be removed by shareholders for cause, while directors serving on a non-classified board may be removed by shareholders with or without cause. As a result, approval of an amendment to declassify the Board would also result in an amendment to the Certificate to give our shareholders the ability to remove a director from the Board with or without cause from and after the 2025 annual meeting of shareholders (at which point the Board would be fully declassified).
Board’s Recommendation to Shareholders
The Board regularly reviews the corporate governance policies and practices of the Company to determine whether they are appropriate and will advance the Board’s and management’s goal of maximizing long-term shareholder value. As part of that review, the Board considered whether the Board’s current structure continues to be advisable. The Board evaluated both the advantages and disadvantages of maintaining a classified Board structure, and determined that the classified Board structure continues to be in the best interests of the Company and our shareholders following the IPO for the following reasons set forth below:
Long-Term Strategic Thinking and Consistency with Investment Horizons. We believe that the Company’s current board structure allows its directors to develop a deeper familiarity of the Company’s business following the IPO and encourages long-term, strategic thinking, which enhances long-term shareholder value. Thus, we believe three-year terms on a staggered basis are appropriate and consistent with an investment horizon for a company such as ours, and that our shareholders are best served by director terms that reflect the long-term nature of our business.
Continuity and Stability from Institutional Knowledge. We believe that three-year terms promote continuity and foster an appropriate institutional memory among directors and a deep knowledge of the business and competitive environment. The Board believed this at the time of our IPO and continues to believe this today. Experienced directors who are knowledgeable about the Company’s fast-paced and complex business environment are a valuable resource and are better positioned to make decisions that are in the best interests of the Company and our shareholders. Staggered terms give the Company’s new directors an opportunity to gain knowledge about the Company’s business from its continuing directors. If all directors were elected annually, the Board could be composed entirely of directors who were unfamiliar with the Company and its business strategies. This could jeopardize our long-term strategies and growth plans.
Accountability to Shareholders. Under the DGCL, all of our directors are required to uphold their fiduciary duties to our shareholders, regardless of how often they stand for election. Under our classified Board structure, a majority of directors will stand for election during any two-year period. The Board has implemented broad measures to ensure accountability of our directors, including the adoption of our Code of Ethics. In addition, the Board requires an annual self-assessment of the performance of the Board and its committees, which is led by the Compensation and Nominating Committee. This committee also considers the performance of each current director when determining whether or not to recommend the nomination of such director for an additional term. Additionally, any director, or the entire Board, may be removed from office if there is “cause” for removal, subject to the terms of the Certificate. As a result, Maravai benefits from the stability and continuity of a classified Board structure, while retaining meaningful director accountability.
Protecting Shareholder Value in the Event of an Unsolicited Acquisition Offer. The Company’s current board structure reduces its vulnerability to potentially unfair and abusive takeover tactics and encourages potential acquirers to negotiate with the Board. We believe that the classified Board structure may improve the
relative bargaining power of the Company on behalf of its shareholders by providing leverage to negotiate for higher value bids or pursue third party suitors who may be able to offer a higher value. A classified board structure does not preclude unsolicited acquisition proposals. However, by eliminating the threat of imminent removal, it allows the Board to maximize the value of a potential acquisition by giving the Company time and bargaining leverage to evaluate and negotiate the adequacy and fairness of any takeover proposal and to consider alternatives, including the continued operation of the Company’s business.
The Board recommends that you vote, on an advisory basis, “FOR” the retention of our classified Board structure.
PROPOSAL 3—ADVISORY VOTE REGARDING RETENTION OF THE SUPERMAJORITY VOTING STANDARDS IN OUR CHARTER AND BYLAWS
Background of the Proposal
Our Certificate and our amended and restated bylaws (our “Bylaws”) provide that our Board is expressly authorized to make, alter, amend, change, add to, rescind or repeal, in whole or in part, our Bylaws without a shareholder vote in any matter not inconsistent with the DGCL and our Certificate. For as long as GTCR beneficially owns, in the aggregate, at least 50% in voting power of the stock of the Company entitled to vote generally in the election of directors, any amendment, alteration, rescission or repeal of our Bylaws by our shareholders will require the affirmative vote of a majority in voting power of the outstanding shares of our stock entitled to vote on such amendment, alteration, change, addition, rescission or repeal. At any time when GTCR beneficially owns, in the aggregate, less than 50% in voting power of all outstanding shares of the stock of the Company entitled to vote generally in the election of directors, any amendment, alteration, rescission or repeal of our Bylaws by our shareholders will require the affirmative vote of the holders of at least 66 2⁄3% in voting power of all the then outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class.
The DGCL provides generally that the affirmative vote of a majority of the outstanding shares entitled to vote thereon, voting together as a single class, is required to amend a corporation’s certificate of incorporation, unless the certificate of incorporation requires a greater percentage.
Our Certificate provides that at any time when GTCR beneficially owns, in the aggregate, less than 50% in voting power of the stock of the Company entitled to vote generally in the election of directors, the following provisions in our Certificate may be amended, altered, repealed or rescinded only by the affirmative vote of the holders of at least 66 2⁄3% (as opposed to a majority threshold that would apply if GTCR beneficially owns, in the aggregate, 50% or more) in voting power of all the then outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class:
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the provisions providing for a classified board of directors (the election and term of our directors);
the provisions regarding resignation and removal of directors;
the provisions regarding entering into business combinations with interested shareholders;
the provisions regarding shareholder action by written consent;
the provisions regarding calling special meetings of shareholders;
the provisions regarding filling vacancies on our Board and newly created directorships;
the provisions eliminating monetary damages for breaches of fiduciary duty by a director;
the provisions relating to exclusive forum for resolution of certain actions; and
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In addition, our Certificate provides that directors may be removed with or without cause upon the affirmative vote of a majority in voting power of all outstanding shares of stock entitled to vote thereon, voting together as a single class; provided, however, at any time when GTCR beneficially owns, in the aggregate, less than 40% in voting power of the stock of the Company entitled to vote generally in the election of directors, directors may only be removed for cause, and only by the affirmative vote of holders of at least 662⁄3% in voting power of all the then-outstanding shares of stock of the Company entitled to vote thereon, voting together as a single class.
At the time of our IPO, the Board believed that the supermajority voting standards under our Certificate and Bylaws were an important piece of the Company’s governance structure to safeguard the long-term interests of the Company and its shareholders once GTCR no longer holds a majority of our shares. At the same time, the Board recognized that some investors may view the supermajority voting standards as a means of blocking initiatives supported by shareholders, but blocked by a status quo management. Accordingly, at the Annual Meeting, the Company is asking our shareholders to vote, on an advisory basis, whether to retain the supermajority voting standards.
If this proposal is approved by the holders of a majority of shares of the Company’s common stock voting on the proposal at the Annual Meeting, then the Company will retain the supermajority voting standards. Conversely, if a majority of shares of the Company’s common stock voting on the proposal at the Annual Meeting vote against the proposal, then this proposal would not by itself remove the supermajority voting standards. Instead, rejection of the proposal would only advise the Board that a majority of our shareholders voting at the Annual Meeting desire to eliminate the supermajority voting standards. Consistent with its fiduciary duties, if shareholders vote against this proposal, the Board will reevaluate its position with respect to the retention of the supermajority voting standards. This reevaluation would include considering the percentage of shareholders voting against this proposal. An affirmative vote of not less than 50% of the then outstanding shares of the Company entitled to vote at a duly held meeting is required to amend the Certificate to remove the supermajority voting standards (or 66 2⁄3% if GTCR owns, in the aggregate, less than 50% in voting power of the stock of the Company entitled to vote generally in the election of directors). If shareholders representing less than 50% of outstanding common stock reject this proposal, then the Board will likely not take additional steps to remove the supermajority voting standards.
If a majority of our shareholders vote against this proposal and the Board determines that the elimination of the supermajority voting standards are in the best interests of the Company and its shareholders, then the Board will include a proposal in the proxy statement for the 2022 annual meeting of shareholders to amend our Certificate and Bylaws to eliminate the supermajority voting standards. An amendment to the Certificate and Bylaws must first be approved by the Board and then approved by the affirmative vote of not less than 50% of the then outstanding shares of the Company entitled to vote at a duly held meeting (or 66 2⁄3% if GTCR owns, in the aggregate, less than 50% in voting power of the stock of the Company entitled to vote generally in the election of directors) (or 66 2⁄3% if GTCR owns, in the aggregate, less than 50% in voting power of the stock of the Company entitled to vote generally in the election of directors). If such amendment were approved, the Certificate and Bylaws would be amended immediately thereafter to remove the supermajority voting standards.
If shareholders representing less than 50% of outstanding common stock reject this proposal, then the Board will likely not take additional steps to remove the supermajority voting standards.
Board’s Recommendation to Shareholders
The Board regularly reviews the corporate governance policies and practices of the Company to determine whether they are appropriate and will advance the Board’s and management’s goal of maximizing long-term shareholder value. As part of that review, the Board considered whether retention of the supermajority voting standards continues to be advisable. The Board evaluated both the advantages and disadvantages of maintaining the supermajority voting standards, and determined that retaining the supermajority voting standards continues to be in the best interests of the Company and our shareholders following the IPO for the following reasons:
the supermajority voting standards under our Certificate and Bylaws are appropriately limited and necessary with application only to extraordinary transactions and fundamental changes to corporate governance;
Delaware law permits supermajority voting requirements and a number of publicly-traded companies have adopted these provisions to preserve and maximize long-term value for all shareholders;58
the Board believes that the supermajority vote requirements protect shareholders, particularly minority shareholders, against the potentially self-interested actions of short-term investors and, without these provisions, it would be possible for a group of short-term shareholders to approve an extraordinary transaction that is not in the best interest of the Company and opposed by nearly half of the Company’s shareholders;
these provisions mitigate the risks presented by a group of short-term shareholders, who may (i) only own their shares as of a voting record date or may have hedged their economic exposure and (ii) act in their own self-interests to the detriment of other shareholders;
these supermajority voting requirements encourage potential acquirers to deal directly with the Board, which in turn enhances the Board’s ability to consider the long-term interests of all shareholders; and
these supermajority voting requirements protect the ability of the Board to evaluate proposed offers, to consider alternatives, and to protect shareholders against abusive tactics during a takeover process.
The Board recommends that you vote, on an advisory basis, “FOR” the retention of the supermajority voting standards in our Certificate and Bylaws.
PROPOSAL 4—RATIFICATION2 –RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee has appointed Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2021.2023. Services provided to the Company and its subsidiaries by Ernst & Young LLP for the fiscal year ended December 31, 20202022, are described below and under “Audit Committee Report.”
Fees and Services
The following table represents aggregate fees billed to us for services related to the fiscal years ended December 31, 20202022 and 20192021 by Ernst & Young LLP, our independent registered public accounting firm:
2020 | 2019 | 2022 | 2021 | |||||||||||||
Audit Fees(1) | $ | 5,121,250 | $ | 1,007,950 | ||||||||||||
Audit Fees(1) | $ | 3,944,200 | $ | 4,412,981 | ||||||||||||
Audit-Related Fees | — | 24,500 | — | — | ||||||||||||
Tax Fees | — | — | — | — | ||||||||||||
All Other Fees | — | — | $ | 4,465 | 3,590 | |||||||||||
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Total | $ | 5,121,250 | $ | 1,032,450 | $ | 3,948,665 | $ | 4,416,571 | ||||||||
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(1) | In 2022, Audit Fees consisted of fees and expenses covering the audit of our consolidated financial statements, review of the interim condensed consolidated financial statements and accounting and financial reporting consultations. In 2021, Audit Fees consisted of fees and expenses covering the integrated audit of our consolidated financial statements and of our internal control over financial reporting, review of the interim condensed consolidated financial statements, accounting and financial reporting consultations, |
(2) |
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All of the services described above following our IPO in November 2020 were pre-approved by our Audit Committee. The Audit Committee concluded that the provision of these services by Ernst & Young LLP would not affect their independence.
Pre-Approval Policies and Procedures
The Audit Committee has adopted a policy that requires advance approval of all audit services as well as non-audit services to the extent required by the Exchange Act and the Sarbanes-Oxley Act of 2002. Unless the specific service has been previously pre-approved with respect to that year, the Audit Committee must approve the permitted service before the independent auditor is engaged to perform it.
Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting. They will have the opportunity to make a statement if they desire to do so, and we expect that they will be available to respond to questions.
Vote Required; Recommendation of the Board of Directors
Ratification of the appointment of Ernst & Young LLP requires affirmative votes from the holders of a majority of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote. If Maravai’s shareholders do not ratify the appointment of Ernst & Young LLP, the Audit Committee will
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reconsider the appointment and may affirm the appointment or retain another independent registered accounting firm. Even if the appointment is ratified, the Audit Committee may in the future replace Ernst & Young LLP as our independent registered public accounting firm if it is determined that it is in Maravai’s best interests to do so.
The Audit Committee and the Board recommendsrecommend that you vote “FOR” the ratification of the appointment of Ernst & Young LLP as the independent registered public accounting firm for the year ending December 31, 2021.2023.
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The Audit Committee oversees our financial reporting process on behalf of the Board. The Audit Committee is composed of three independent directors (as defined by the Nasdaq listing guidelines)standards) and following its formationmet eight times in connection with our IPO in November 2020, met one time in 2020.2022. Our Audit Committee operates under a written charter, which is posted on our website at investors.maravai.com. The Audit Committee’s oversight responsibilities include monitoring the integrity of our consolidated financial statements (including reviewing financial information, the systems of internal controls, the audit process, and the independence and performance of the independent registered public accounting firm) and our compliance with legal and regulatory requirements. Management has the primary responsibility for the consolidated financial statements and the reporting process, including our systems of internal controls. In fulfilling its oversight responsibilities, the Audit Committee hereby reports as follows:
The Audit Committee has reviewed and discussed the audited consolidated financial statements and internal control over financial reporting for the fiscal year ended December 31, 20202022, with our management;
• | The Audit Committee has discussed with Ernst & Young LLP, our independent registered public accounting firm, who is responsible for expressing an opinion on the conformity of our consolidated financial statements with generally accepted accounting principles in the United States and as to the effectiveness of our internal control over financial reporting, its judgments as to the quality, not just the acceptability, of our accounting principles and such other matters required to be discussed by the applicable requirements of Auditing Standards No. 1301, “Communications with Audit Committees” issued by the Public Company Accounting Oversight Board (“PCAOB”) |
• | The Audit Committee has received the written disclosures and the letter from Ernst & Young LLP required by PCAOB Ethics and Independence Rule 3526, “Communication with Audit Committees Concerning Independence,” regarding the independent registered |
Based on the Audit Committee’s review and discussions noted above, the Audit Committee recommended to the Board that the audited consolidated financial statements and management’s assessment of the effectiveness of our internal control over financial reporting be included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.2022.
Respectfully submitted by:
Susannah Gray, Chair
Anat Ashkenazi
Jessica Hopfield, Ph.D.
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PROPOSAL 3 – ADVISORY VOTE ON THE COMPENSATION
Section 14A of the Exchange Act (which was added by the Dodd-Frank Wall Street Reform and Consumer Protection Act) requires that we provide shareholders with the opportunity to approve, on a non-binding advisory basis, the compensation of our Named Executive Officers. At our 2022 annual meeting of shareholders, a majority of our shareholders voted, consistent with the recommendation of the Board, to hold an annual say-on-pay vote. This annual vote will continue unless our shareholders vote, at our 2028 annual meeting of shareholders, to approve a different say-on-pay vote frequency, as required pursuant to Section 14A of the Exchange Act. The Board believes that an annual say-on-pay vote allows our shareholders to provide us with more frequent and direct input on our compensation philosophy, policies and practices.
At the Annual Meeting, the Board is asking shareholders to approve, on a non-binding advisory basis, the compensation of our Named Executive Officers as disclosed in this proxy statement by voting “for” the following resolution. In considering this proposal, we urge shareholders to read the Compensation Discussion and Analysis, the accompanying compensation tables and the related narrative disclosure. As described in detail in the Compensation Discussion and Analysis, the majority of our executives’ total compensation is at-risk, tied to achieving annual and long-term goals that achieve our strategic objectives, promote longer-term performance and long-term shareholder value creation, and support the Company’s leadership retention strategy. The design of our long-term incentives coupled with robust stock ownership guidelines seek to ensure that our executives’ interests are aligned with those of long-term shareholders.
“RESOLVED, that the shareholders of the Company approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in the Company’s proxy statement for its 2023 annual meeting of shareholders pursuant to the compensation disclosure rules of the SEC, including the Compensation Discussion and Analysis section and the accompanying compensation tables and related narrative disclosure.”
Although this vote is non-binding, the Board and the Compensation and Leadership Development Committee will review and evaluate the voting result when considering future executive compensation decisions.
The Board recommends that you vote “FOR” approval, on a non-binding advisory basis, of the compensation of our Named Executive Officers as disclosed in this proxy statement.
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We are not aware of any matters other than those discussed in the foregoing materials contemplated for action at the Annual Meeting. The persons named in the proxy card will vote in accordance with the recommendation of the Board on any other matters incidental to the conduct of, or otherwise properly brought before, the Annual Meeting. The proxy card contains discretionary authority for them to do so.
The Audit Committee Report shall not be deemed soliciting material or filed with the SEC and shall not be deemed incorporated by reference into any prior or future filings made by us under the Securities Act or the Exchange Act, except to the extent that we specifically incorporate such information by reference. In addition, this document includes website addresses, which are intended to provide inactive, textual referencereferences only. The information provided on or accessible through these websites is not part of, nor is it incorporated by reference into, this document.proxy statement.
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AVAILABILITY OF SEC FILINGS, CODE OF CONDUCTETHICS AND COMMITTEE CHARTERS
Copies of our annual reports on FormsForm 10-K, quarterly reports on Form 10-Q, current reports on 8-K, and all amendments to those reports, filed with the SEC, and our Code of Conduct,Ethics, Corporate Governance Guidelines and the charters of the Audit Committee, and Compensation and Leadership Development Committee, and Nominating, Governance and Risk Committee, and any reports of beneficial ownership of our Common Stockcommon stock filed by executive officers, directors and beneficial owners of more than 10% of our outstanding common stock are posted on, and may be obtained, free of charge, through our website, investors.maravai.com, or may be requested in print, at no cost, by email at ir@maravai.com or by mail at Maravai LifeSciences Holdings, Inc., 10770 Wateridge Circle Suite 200, San Diego, California 92121, Attention: Investor Relations.
WHERE TO FIND ADDITIONAL INFORMATION
We are subject to the informational requirements of the Exchange Act and in accordance therewith, we file annual, quarterly and current reports and other information with the SEC. Such information may be accessed electronically by means of the SEC’s home page on the Internet at www.sec.gov. We are an electronic filer, and the SEC maintains an Internet site at www.sec.gov that contains the reports and other information we file electronically. Our website address is investors.maravai.com. Please note that our website address is provided as an inactive textual reference only. We make available free of charge, through our website, our annual report on Form 10-K, as amended, quarterly reports on Form 10-Q, and current reports on Form 8-K, and all amendments to those reports, as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. The information provided on or accessible through our websitethese websites is not part of this proxy statement.
Maravai is paying the expenses of this solicitation. Maravai will also make arrangements with brokerage houses and other custodians, nominees and fiduciaries to forward proxy materials to beneficial owners of our common stock held as of the Record Date by such persons, and Maravai will reimburse such persons for their reasonable out-of-pocket expenses in forwarding such proxy materials. In addition to solicitation by mail, directors, officers and other employees of Maravai may solicit proxies in person or by telephone, facsimile, email or other similar means.
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YOUR VOTE IS IMPORTANT! PLEASE VOTE BY: INTERNET Go To: www.proxypush.com/MRVI Cast your vote online P.O. BOX 8016, CARY, NC 27512-9903 Have your Proxy Card ready Follow the simple instructions to record your vote PHONE Call 1-866-437-3716 Use any touch-tone telephone Have your Proxy Card ready Follow the simple recorded instructions MAIL Mark, sign and date your Proxy Card Fold and return your Proxy Card in the postage-paid envelope provided Maravai LifeSciences Holdings, Inc. Annual Meeting of Shareholders For Shareholders of record as of March 21, 2023 TIME: Thursday, May 18, 2023 2:30 PM, Pacific Time PLACE: Annual Meeting to be held live via the Internet please visit www.proxydocs.com/MRVI for more details. This proxy is being solicited on behalf of the Board of Directors
The undersigned hereby appoints Carl Hull and Constantine Mihas (the “Named Proxies”), and each or either of them, as the true and lawful attorneys of the undersigned, with full power of substitution and revocation, and authorizes them, and each of them, to vote all the shares of capital stock of Maravai LifeSciences Holdings, Inc. which the undersigned is entitled to vote at said meeting and any adjournment thereof upon the matters specified and upon such other matters as may be properly brought before the meeting or any adjournment thereof, conferring authority upon such true and lawful attorneys to vote in their discretion on such other matters as may properly come before the meeting and revoking any proxy heretofore given.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION IS GIVEN, SHARES WILL BE VOTED IDENTICAL TO THE BOARD OF DIRECTORS RECOMMENDATION. This proxy, when properly executed, will be voted in the manner directed and according to the specifications indicated herein. In their discretion, the Named Proxies are authorized to vote upon such other matters that may properly come before the meeting or any adjournment or postponement thereof.
You are encouraged to specify your choice by marking the appropriate box (SEE REVERSE SIDE) but you need not mark any box if you wish to vote in accordance with the Board of Directors’ recommendation. The Named Proxies cannot vote your shares unless you sign (on the reverse side) and return this card.
PLEASE BE SURE TO SIGN AND DATE THIS PROXY CARD AND MARK ON THE REVERSE SIDE
Copyright © 2021 Mediant Communications Inc. All Rights Reserved
Maravai LifeSciences Holdings, Inc.
Annual Meeting of Shareholders
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Please make your marks like this: X THE BOARD OF DIRECTORS RECOMMENDS A VOTE: FOR EACH DIRECTOR IN PROPOSAL 1 FOR PROPOSAL 2 FOR PROPOSAL 3 BOARD OF DIRECTORS PROPOSAL YOUR VOTE RECOMMENDS 1. To elect three nominees to serve as Class III directors, as recommended by the Nominating, Governance and Risk Committee of the Board: FOR WITHHOLD 1.01 Anat Ashkenazi FOR P2 P2 1.02 Gregory T. Lucier FOR P3 P3 1.03 Luke Marker FOR P4 P4 FOR AGAINST ABSTAIN 2. To ratify the appointment of Ernst & Young LLP as Maravai’s independent registered public FOR accounting firm for the year ending December 31, 2023. P5 P5 P5 3. To approve, on a non-binding advisory basis, the compensation of Maravai’s named executive FOR officers. P6 P6 P6 4. To transact other business as may properly come before the meeting or any postponement or adjournment of the meeting. You must pre-register to attend the meeting online and/or participate at www.proxydocs.com/MRVI.
Authorized Signatures - Must be completed for your instructions to be executed.
Please sign exactly as your name(s) appears on your account. If held in joint tenancy, all persons should sign. Trustees, administrators, etc., should include title and authority. Corporations should provide full name of corporation and title of authorized officer signing the Proxy/Vote Form. Signature (and Title if applicable) Date Signature (if held jointly) Date