UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
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SciClone Pharmaceuticals, Inc. |
(Name of Registrant as Specified In Its Charter) |
|
(Name of Person(s) Filing Proxy Statement, if other than the Registrant) |
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Date | June 10, 2008 | |||||
Time | 10:00 a.m., Pacific Daylight Time | |||||
Place | Marriott San Mateo/ San Francisco Airport 1770 S. Amphlett Blvd. San Mateo, CA 94402 |
Items of Business | 1. Election of seven (7) directors; and | |||||
2. Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2008; and | ||||||
3. Any other matters that properly come before the Annual Meeting and any adjournment or postponement thereof. |
Record Date | Stockholders of record at the close of business on April 21, 2008 will be entitled to vote at the Annual Meeting. For ten days prior to the Annual Meeting, a complete list of stockholders entitled to vote at the meeting will be available for examination by any stockholder, for any purpose relating to the meeting, during ordinary business hours at our principal offices located at 950 Tower Lane, Suite 900, Foster City, California 94404. | |||||
Admission | Please note that space limitations may make it necessary to limit attendance only to stockholders. Registration will begin at 9:30 a.m. and seating will be available at approximately 9:30 a.m. Each stockholder may be asked to present valid picture identification, such as a driver’s license or passport. Stockholders holding stock in brokerage accounts (street name holders) will need to bring a copy of a brokerage statement reflecting stock ownership as of the record date. Cameras, recording devices and other electronic devices will not be permitted at the meeting. |
President and Chief Executive Officer
May 2, 2008
YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, WE URGE YOU TO VOTE YOUR SHARES BY PHONE, VIA THE INTERNET OR BY SIGNING, DATING AND RETURNING THE ENCLOSED PROXY CARD AT YOUR EARLIEST CONVENIENCE. PLEASE SEE YOUR PROXY CARD FOR SPECIFIC INSTRUCTIONS ON HOW TO VOTE. PROXIES ARE REVOCABLE, AND ANY STOCKHOLDER MAY WITHDRAW HIS OR HER PROXY PRIOR TO THE TIME IT IS VOTED OR BY ATTENDING THE MEETING AND VOTING IN PERSON. |
PROXY STATEMENT | 1 | |||||
SOLICITATION AND VOTING OF PROXIES | 1 | |||||
GENERAL | 1 | |||||
VOTING SECURITIES | 1 | |||||
BROKER NON-VOTES | 1 | |||||
SOLICITATION OF PROXIES | 1 | |||||
VOTING OF PROXIES | 1 | |||||
PROPOSAL NO. 1ELECTION OF DIRECTORS | 3 | |||||
NOMINEES | 3 | |||||
RECOMMENDATION OF THE BOARD OF DIRECTORS: | 5 | |||||
CORPORATE GOVERNANCE | 6 | |||||
TERM; DIRECTOR INDEPENDENCE | 6 | |||||
EXECUTIVE SESSIONS | 6 | |||||
BOARD MEETINGS AND COMMITTEES | 6 | |||||
COMMITTEE CHARTERS AND OTHER CORPORATE GOVERNANCE MATERIALS | 7 | |||||
DIRECTOR NOMINATIONS | 7 | |||||
Director Qualifications | 8 | |||||
Identifying and Evaluating Candidates for Nomination as Director | 8 | |||||
COMMUNICATIONS BY STOCKHOLDERS WITH DIRECTORS | 9 | |||||
DIRECTOR ATTENDANCE AT ANNUAL MEETINGS | 10 | |||||
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION | 10 | |||||
COMPENSATION OF DIRECTORS | 10 | |||||
PROPOSAL NO. 2RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 12 | |||||
GENERAL | 12 | |||||
PRINCIPAL ACCOUNTANT FEES | 12 | |||||
REQUIRED VOTE | 12 | |||||
RECOMMENDATION OF THE BOARD OF DIRECTORS | 13 | |||||
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | 14 | |||||
“EXECUTIVE COMPENSATION AND OTHER MATTERS” | 16 | |||||
NON-DIRECTOR EXECUTIVE OFFICERS | 16 | |||||
COMPENSATION DISCUSSION AND ANALYSIS | 16 | |||||
Overview | 16 | |||||
COMPENSATION PHILOSOPHY | 16 | |||||
OBJECTIVES OF OUR COMPENSATION PROGRAM | 17 | |||||
WHAT OUR COMPENSATION PROGRAM IS DESIGNED TO REWARD | 17 | |||||
COMPENSATION PROCESS, ROLE OF MANAGEMENT, INDEPENDENT COMPENSATION CONSULTANTS, PEER GROUP SELECTION AND BENCHMARKING | 18 | |||||
Compensation Process, Role of Management | 18 | |||||
Independent Compensation Consultants, Peer Group Selection and Benchmarking | 18 | |||||
ELEMENTS OF OUR COMPENSATION PROGRAM AND HOW EACH ELEMENT IS CHOSEN | 19 | |||||
Base Salary | 20 | |||||
Annual Cash Incentives | 21 | |||||
Long-Term Equity Incentives | 22 | |||||
CHANGE IN CONTROL AND TERMINATION BENEFITS | 23 | |||||
TAX CONSIDERATIONS | 23 |
COMPENSATION COMMITTEE REPORT | 24 | |||||
SUMMARY COMPENSATION TABLE | 25 | |||||
GRANTS OF PLAN-BASED AWARDS | 26 | |||||
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END | 28 | |||||
OPTION EXERCISES AND STOCK VESTED DURING LAST FISCAL YEAR | 29 | |||||
PENSION BENEFITS AND NONQUALIFIED DEFERRED COMPENSATION PLANS | 29 | |||||
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE-IN-CONTROL | 29 | |||||
Friedhelm Blobel, Ph.D. | 29 | |||||
Mr. Richard Waldron | 29 | |||||
Mr. Hans Schmid | 29 | |||||
TRANSACTIONS WITH RELATED PERSONS | 33 | |||||
INDEBTEDNESS OF MANAGEMENT | 34 | |||||
SECTION 16(a) Beneficial Ownership Reporting Compliance | 34 | |||||
EQUITY COMPENSATION PLAN INFORMATION | 35 | |||||
REPORT OF THE AUDIT COMMITTEE | 36 | |||||
YEAR 2009 STOCKHOLDER PROPOSALS | 37 | |||||
OTHER MATTERS | 37 | |||||
PROXY STATEMENT
will be voted in accordance with that specification. If no choice is indicated on the proxy, the shares will be voted in favor of the proposal, and as the proxy holders deem advisable on other matters that may come before the meeting. A stockholder giving a proxy has the power to revoke his or her proxy at any time before it is exercised by delivering to the Company (Attention: Friedhelm Blobel, Ph.D.) a written instrument revoking the proxy or a duly executed proxy with a later date or by attending the meeting and voting in person.
PROPOSAL NO. 1
NAME OF NOMINEE | AGE | PRINCIPAL OCCUPATION | DIRECTOR SINCE | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dean S. Woodman | 79 | Chairman, SciClone Pharmaceuticals, Inc.; Founder, Robertson Stephens; Former Managing Director, ING Barings | 2000 | |||||||||||
John D. Baxter, M.D. | 67 | Senior Member, Co-Director Diabetes Center, The Methodist Hospital Research Institute | 1991 | |||||||||||
Friedhelm Blobel, Ph.D. | 59 | President and Chief Executive Officer, SciClone Pharmaceuticals, Inc. | 2006 | |||||||||||
Richard J. Hawkins | 59 | Chairman, President and Chief Executive Officer, LabNow, Inc. | 2004 | |||||||||||
Rolf H. Henel | 70 | Partner, Naimark & Associates, Inc. | 1997 | |||||||||||
Ira D. Lawrence, M.D. | 54 | Senior Vice President, Research and Development, Medicis Pharmaceuticals, Inc. Former President and Chief Executive Officer, SciClone Pharmaceuticals, Inc., Former Senior Vice President of Research and Development at Astellas Pharma Inc. (formerly Fujisawa Healthcare Inc.) | 2005 | |||||||||||
Jon S. Saxe | 71 | Former President, PDL BioPharma, Inc. (formerly Protein Design Labs, Inc.); Former Vice President, Hoffmann-LaRoche, Inc. | 2000 |
1982. Mr. Woodman worked in the investment banking division of Merrill Lynch for 23 years where he spent 16 years as director of West Coast corporate finance until 1978. He is currently a director of MarineMax, Inc. and of Medallion Bank, a wholly-owned subsidiary of Medallion Financial Corp.
School. Dr. Lawrence earned his M.D. degree, from the Hahnemann Medical College (now Drexel University College of Medicine) and his B.A. from Temple University. Dr. Lawrence completed his internship and residency in internal medicine at Northwestern University and his fellowship at the Division of Allergy and Clinical Immunology at the Johns Hopkins University School of Medicine.
THE ELECTION OF ALL NOMINEES NAMED ABOVE.
CORPORATE GOVERNANCE
Committee Composition (Since 2007 Annual Meeting) | Audit | Compensation | Nominating and Corporate Governance | Business Development | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dean S. Woodman | X | Chairman | ||||||||||||||||
John D. Baxter, M.D. | X | X | ||||||||||||||||
Richard J. Hawkins | X | X | ||||||||||||||||
Rolf H. Henel | Chairman | Chairman | ||||||||||||||||
Ira D. Lawrence, M.D. | X | X | ||||||||||||||||
Jon S. Saxe | Chairman | X | X | |||||||||||||||
Number of Meetings During Fiscal 2007 | 6 | 5 | 2 | 3 |
adequacy of disclosure controls and internal controls and procedures for financial reporting, reviewing our critical accounting policies, reviewing significant judgments made in the preparation of our financial statements and reviewing and approving any related party transactions. The Audit Committee held six meetings during Fiscal 2007.
• | the appropriate size of our Board of Directors and its Committees; |
• | the perceived needs of the Board for particular skills, background and business experience; |
• | the skills, background, reputation, and business experience of nominees compared to the skills, background, reputation, and business experience already possessed by other members of the Board; |
• | nominees’ independence from management; |
• | applicable regulatory and listing requirements, including independence requirements and legal considerations, such as regulatory compliance; |
• | the benefits of a constructive working relationship among directors; and |
• | the desire to balance the considerable benefit of continuity with the periodic injection of the fresh perspective provided by new members. |
Governance Committee’s established procedures for evaluating potential director nominees, any recommendation for director nominee submitted by a stockholder must be sent in writing to the Corporate Secretary, SciClone Pharmaceuticals, Inc., 950 Tower Lane, Suite 900, Foster City, CA 94404, not less than 120 days prior to the anniversary of the date proxy statements were mailed to stockholders in connection with the prior year’s annual meeting of stockholders and must contain the following information:
• | the candidate’s name, age, contact information and present principal occupation or employment; and |
• | a description of the candidate’s qualifications, skills, background, and business experience during, at a minimum, the last five years, including his/her principal occupation and employment and the name and principal business of any corporation or other organization in which the candidate was employed or served as a director. |
• | the name and address of the stockholder who intends to make the nomination and of the person or persons to be nominated; |
• | a representation that the stockholder is a holder of record of stock of the corporation entitled to vote for the election of directors on the date of such notice of nomination and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice of nomination; |
• | a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons pursuant to which the nomination or nominations are to be made by the stockholder; |
• | such other information regarding each nominee proposed by such stockholder as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission, had the nominee been nominated, or intended to be nominated, by the Board of Directors; and |
• | the consent of each nominee to serve as a director if so elected. |
or Board of Directors
or [individual director]
c/o Corporate Secretary
SciClone Pharmaceuticals, Inc.
950 Tower Lane, Suite 900
Foster City, CA 94404
Fax: (650) 358-3469
Committee | Member ($) | Chairman ($) | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Audit Committee | 10,000 | (1) | 14,000 | (1) | ||||||
Compensation Committee | 7,500 | 10,000 | ||||||||
Nominating and Corporate Governance Committee | 7,500 | 10,000 |
(1) | On July 25, 2007, after a review by an independent compensation consultant of director compensation disclosed in proxy statements filed by the peer companies reviewed in connection with setting officer compensation described below under “Compensation Discussion and Analysis,” the Compensation Committee authorized an increase in the payments to which members of the Audit Committee are entitled. In particular, the Compensation Committee found that, based on this review, fees payable to Audit Committee members were generally lower than average fees paid to members of the Audit Committee at these comparable companies. Prior this increase, the annual payments for service on the Audit Committee were $7,500 for members and $10,000 for the chairman. |
Name of Director | Fees Earned or Paid in Cash ($) | Option Awards ($)(7) | All Other Compensation ($) | Total ($) | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dean S. Woodman(1) | 65,469 | (1) | 44,781 | — | 110,250 | |||||||||||||
John D. Baxter, M.D.(2) | 46,420 | (2) | 44,781 | — | 91,201 | |||||||||||||
Richard J. Hawkins(3) | 46,080 | (3) | 83,123 | — | 129,203 | |||||||||||||
Rolf H. Henel(4) | 50,000 | (4) | 44,781 | — | 94,781 | |||||||||||||
Ira D. Lawrence, M.D.(5) | 49,260 | (5) | 44,781 | — | 94,041 | |||||||||||||
Jon. S. Saxe(6) | 56,728 | (6) | 44,781 | — | 101,509 | |||||||||||||
Friedhelm Blobel, Ph.D.(8) | — | — | — | — |
(1) | Consists of $30,000 director fee, $7,383 for service as Chairman of the Board of Directors until our 2007 Annual Meeting of Stockholders, $9,506 for service as Chairman of the Board of Directors since our 2007 Annual Meeting of Stockholders, $8,580 for service on the Audit committee for all of Fiscal 2007, and $10,000 for service as the chairman of the Business Development Committee for all of Fiscal 2007. |
(2) | Consists of $30,000 director fee, $7,500 for service on the Compensation Committee for all of Fiscal 2007, $5,679 for service as the chairman of the Medical Review Committee until it was merged with the Business Development Committee in February 2007, and $3,240 for service on the Business Development Committee since our 2007 Annual Meeting of Stockholders. |
(3) | Consists of $30,000 director fee, $8,580 for service on the Audit Committee for all of Fiscal 2007, and $7,500 for service on the Compensation Committee for all of Fiscal 2007. |
(4) | Consists of $30,000 director fee, $20,000 for service as chairman of the Compensation and Corporate Governance and Nominating Committees for all of Fiscal 2007. |
(5) | Consists of $30,000 director fee, $6,875 for service on the Corporate Governance and Nominating Committees for all of Fiscal 2007, $6,875 for service on the Business Development Committee for all of Fiscal 2007, and $5,509 for service on the Medical Review Committee until it was merged with the Business Development Committee in February 2007. |
(6) | Consists of $30,000 director fee, $10,644 for service as chairman of the Audit Committee for all of Fiscal 2007, $8,042 for service on the Corporate Governance and Nominating Committee for all of Fiscal 2007, and $8,042 for service on the Business Development Committee for all of Fiscal 2007. |
(7) | The amounts shown are the compensation costs recognized in our financial statements for Fiscal 2007 related to grants of stock options to our non-employee directors in Fiscal 2007 and prior years, to the extent we recognized compensation costs in Fiscal 2007 for such awards in accordance with the provisions of SFAS 123R, excluding the impact of estimated forfeitures related to service-based vesting conditions. For a discussion of the valuation assumptions used in the SFAS 123R calculations, see Note 1 of Notes to Consolidated Financial Statements,“The Company and Summary of Significant Accounting Policies” included in Part IV, item 15 of our Annual Report on Form 10-K for the year ended December 31, 2007. |
(8) | Dr. Blobel received no compensation for his service on the Board of Directors. Compensation paid to Dr. Blobel as President and Chief Executive Officer is disclosed in the Summary Compensation Table. |
PROPOSAL NO. 2
REGISTERED PUBLIC ACCOUNTING FIRM
2007 | 2006 | |||||||||
---|---|---|---|---|---|---|---|---|---|---|
Audit Fees | $ | 826,000 | $ | 800,000 | ||||||
Audit-Related Fees | 0 | 0 | ||||||||
Tax Fees | 0 | 0 | ||||||||
All Other Fees | 0 | 0 | ||||||||
Total | $ | 826,000 | $ | 800,000 |
of Common Stock of the Company entitled to vote at the Annual Meeting, present in person or represented by proxy. Abstentions and broker non-votes will each be counted as present for purposes of determining a quorum but will not have any effect on the outcome of the proposal.
APPOINTMENT OF ERNST & YOUNG LLP AS OUR INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2008.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
• | all those known by us to be beneficial owners of more than 5% of its Common Stock; |
• | our President and Chief Executive Officer (our principal executive officer), our Executive Vice President and Chief Financial Officer (our principal financial officer) and our most highly-compensated executive officers as of December 31, 2007 (or any executive officer who would have been among the most highly-compensated but for the fact that such an individual was not serving as an executive officer as of December 31, 2007) whose total salary and bonus for the fiscal year ended December 31, 2007 exceeded $100,000 for services in all capacities to SciClone (collectively, the “Named Executive Officers”); |
• | each of our directors; and |
• | all our directors and executive officers as a group. |
Shares Beneficially Owned(1) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Name | Number | Percent | |||||||||
Sigma-Tau Finanziaria S.p.A. and Affiliates(2) c/o Sigma-Tau Finance S.A. 13, Boulevard du Prince Henri L-1724, Luxembourg | 9,667,311 | 20.1 | % | ||||||||
Friedhelm Blobel, Ph.D.(3) | 105,000 | * | |||||||||
Richard A. Waldron(4) | 683,977 | 1.5 | % | ||||||||
Hans P. Schmid(5) | 381,721 | * | |||||||||
Ivan Hui(6) | 255,222 | * | |||||||||
Dean S. Woodman(7) | 262,500 | * | |||||||||
John D. Baxter, M.D.(8) | 558,992 | 1.2 | % | ||||||||
Richard J. Hawkins(9) | 122,500 | * | |||||||||
Rolf H. Henel(10) | 208,100 | * | |||||||||
Ira D. Lawrence, M.D.(11) | 257,500 | * | |||||||||
Jon S. Saxe(12) | 207,500 | * | |||||||||
All directors and executive officers as a group (10 persons)(13) | 3,043,012 | 6.3 | % |
* | Less than 1%. |
(1) | Except pursuant to applicable community property laws, we believe the persons named in the table have sole voting and investment power with respect to all shares. Under the rules of the Securities and Exchange Commission, a person is deemed to be the beneficial owner of shares that can be acquired by such person within 60 days upon the exercise of options. |
(2) | Based on a Schedule 13D filed by Paolo Cavazza on November 23, 2007, a Schedule 13G/A filed by Claudio Cavazza on February 13, 2008, a Schedule 13G/A filed by Sigma Tau Finanziaria S.p.A. (“Sigma Tau”) on February 13, 2008 and a Schedule 13G/A filed by Defiante Farmaceutica, L.d.a., (“Defiante”) on February 13, 2008. Paolo Cavazza is deemed to be the beneficial owner of 9,272,696 shares that he owns directly and indirectly. Of these 9,272,696 shares, Defiante is the beneficial owner of 6,394,988 shares. Chaumiere Consultadoria e Servicos S.A., a Portuguese corporation (“Chaumiere”), is the beneficial owner of 1,289,052 shares. Aptafin S.p.A., an Italian Corporation (“Aptafin”), is the beneficial owner of 765,841 shares, and Paolo Cavazza holds 822,815 shares. Defiante is 58% directly owned by Sigma Tau and 42% directly owned by Sigma Tau’s wholly-owned subsidiary, Sigma Tau International S.A. Paolo Cavazza directly and indirectly owns 38% of Sigma Tau. Claudio Cavazza directly and indirectly owns 57% of Sigma Tau. Aptafin is directly owned by Paolo Cavazza and members of his family. Chaumiere is indirectly owned by Paolo Cavazza and members of his family. In addition, Claudio Cavazza holds 394,615 shares and is deemed the beneficial owner of 6,394,988 shares through his interests in Defiante, and Sigma Tau and its subsidiaries. See “Transactions with Related Persons” below for further information concerning our relationship with Sigma Tau. |
(3) | Includes 100,000 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(4) | Includes 649,417 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. Mr. Waldron’s employment with us will terminate on April 30, 2008. Mr. Waldron is included in the table because he was serving as our Executive Vice President and Chief Financial Officer on December 31, 2007. Pursuant to the Consulting and Resignation Agreement and General Release of All Claims entered into with Mr. Waldron, Mr. Waldron will retain the right to exercise any vested options during a one-year consulting period. |
(5) | Includes 330,585 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(6) | Includes 205,758 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(7) | Includes 192,500 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(8) | Consists of 361,492 shares held by John D. Baxter and Ethelee D. Baxter as Trustees, FBO The Baxter Family Revocable Trust UDT 11/8/95 and 197,500 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(9) | Consists of 122,500 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(10) | Includes 197,500 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(11) | Consists of 257,500 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(12) | Includes 192,500 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
(13) | Includes 2,445,760 shares issuable pursuant to options exercisable within 60 days of March 31, 2008. |
“EXECUTIVE COMPENSATION AND OTHER MATTERS”
corporate vision and values and have the skills and motivation to execute on our corporate strategy. In our dynamic work environment, we foster the following corporate values:
• | Leadership |
• | Innovation and creativity |
• | Diversity |
• | Teamwork |
• | Accountability |
• | High ethical standards |
• | Motivate executives and employees to work towards completing our overall corporate goals and milestones and their individual employee objectives over the short and long-term |
• | Align our executives’ and employees’ performance with our stockholders’ interests |
• | Compete effectively with the compensation programs of comparable companies to allow us to compete with our peers for valuable human resources |
• | Increase revenues in China by 10% |
• | Launch DC BeadTM in China |
• | Expand clinical development, regulatory and business development capabilities in China |
• | Acquire one new product for the China market |
• | Begin enrollment in phase 3 trial for thymalfasin in malignant melanoma |
• | Begin enrollment in phase 2 clinical trial for SCV-07 and one additional phase 2 clinical trial for thymalfasin or SCV-07 |
• | Complete animal model studies for SCV-07 in various indications |
Peer Group Selection and Benchmarking
represents the companies with which we compete for executive and professional talent. Setren supplemented the Radford data with its own survey of publicly available information filed by a group of the following peer companies (“Setren Peer Data”) we suggested:
Allos Therapeutics | Curagen Corporation | Kosan Biosciences, Inc. | ||||||||
Alfacell Corporation | Cytokinetics, Inc. | Metabasis Therapeutics, Inc. | ||||||||
Anadys Pharmaceuticals | Dendreon Corporation | Oxigene, Inc. | ||||||||
Anesiva, Inc. | Genitope Corporation | Neopharm, Inc. | ||||||||
Antigenics, Inc. | Genta, Inc. | Peregrine Pharmaceuticals, Inc. | ||||||||
Ariad Pharmaceuticals, Inc. | Genvec, Inc. | Point Therapeutics, Inc. | ||||||||
Avi Biopharma Inc. | Immunomedics, Inc. | Seattle Genetics, Inc. | ||||||||
Cell Genesys, Inc. | Inhibitex, Inc. | Vical, Inc. | ||||||||
Cell Therapeutics, Inc | Introgen Therapeutics, Inc. | Vion Pharmaceuticals, Inc. |
• | Fixed and variable compensation to reward individual and corporate performance |
• | Cash and equity compensation to align an executive’s performance with our stockholders’ interests |
• | Short and long-term compensation to encourage retention and reward long-term service |
Element of Compensation | How Element of Compensation is Determined | Purpose of Element of Compensation | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Base Salary | Target is the 50th Percentile of comparable salaries as based on the 129 Northern California companies in the Radford Global Life Sciences Survey | Provide a fixed salary which is competitive with that of our peers | ||||||||
Annual Cash Incentives | Based on percentage of base salary. The actual percentage awarded is based on targeted total compensation, achieving individual and corporate objectives, and the individual’s performance in relation to the objectives | Provide a variable cash incentive to motivate employees to achieve individual and corporate objectives | ||||||||
Long-Term Equity Incentives | Based on the long-term equity incentives offered by the 129 Northern California companies in the Radford Global Life Sciences Survey Long-term equity incentives include the following: Stock options Performance Awards | Provide a variable long-term equity incentive to motivate employees to achieve individual and corporate objectives and align interests of employees with those of stockholders Long-term equity incentives seek to encourage a focus on growth, profitability, stock price appreciation, insider ownership of stock and retention of employees | ||||||||
Retirement Benefits | Offered to all employees as pre-tax employee contributions and matching corporate contributions to an individual 401-K plan | Retain employees and offer vehicles for retirement savings | ||||||||
Health and Welfare Benefits | Offered to all employees to provide a comprehensive benefit package, including medical plan, dental plan, vision plan, flexible spending account, short and long-term disability insurance, life insurance and employee stock purchase program | Retain employees and offer plans to meet healthcare and insurance needs | ||||||||
Change in Control and Termination Benefits | Offered to our executive officers to allow for payment of severance upon change in control or termination of employment | Retain executive officers and ensure management continuity in the event of a change of control |
executive compensation from comparison companies from Radford and from the Setren Peer Data were substantially similar, and he discussed the criteria for selection of the comparison companies.
COMPENSATION COMMITTEE REPORT
Rolf H. Henel, John D. Baxter and Richard J. Hawkins
Name and Principal Position | Year | Salary ($)(1) | Bonus ($) | Stock Awards ($) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($)(4) | Total ($) | ||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Friedhelm Blobel, Ph.D.(5) | 2007 | 425,000 | — | — | 594,282 | 156,400 | — | 12,572 | 1,188,254 | ||||||||||||||||||||||||||||||
President and Chief Executive Officer (Principal Executive Officer) | 2006 | 232,052 | — | — | 349,772 | 120,000 | — | 40,000 | 741,824 | ||||||||||||||||||||||||||||||
Richard A. Waldron(5) | 2007 | 345,000 | 15,000 | — | 155,979 | 73,382 | — | 11,492 | 600,853 | ||||||||||||||||||||||||||||||
Former Executive Vice President and Chief Financial Officer (Principal Financial Officer) | 2006 | 325,686 | — | — | 229,870 | 95,750 | — | 10,000 | 661,306 | ||||||||||||||||||||||||||||||
Hans P. Schmid | 2007 | 300,000 | — | — | 125,976 | 105,000 | — | 12,572 | 543,548 | ||||||||||||||||||||||||||||||
President and Managing Director, SciClone Pharmaceuticals International Ltd. | 2006 | 277,970 | — | — | 135,726 | 90,000 | — | 10,000 | 513,696 | ||||||||||||||||||||||||||||||
Ivan Hui(6) | 2007 | 167,611 | — | — | 66,065 | 35,000 | — | 8,432 | 277,108 | ||||||||||||||||||||||||||||||
Principal Accounting Officer |
(1) | Reflects annual base salary for 2007 and 2006 respectively, and includes amounts (if any) deferred at the Named Executive Officer’s option under our 401(k) plan. |
(2) | The amounts shown are the compensation costs recognized in our financial statements for fiscal 2006 and Fiscal 2007 related to grants of stock options to each Named Executive Officer in fiscal 2006 and Fiscal 2007 and prior years, to the extent we recognized compensation cost in fiscal 2006 or Fiscal 2007 for such awards in accordance with the provisions of SFAS 123R, excluding the impact of estimated forfeitures related to service-based vesting conditions. For a discussion of valuation assumptions used in the SFAS 123R calculations, see Note 1 of Notes to Consolidated Financial Statements,“The Company and Summary of Significant Accounting Policies — Stock-Based Compensation” and Note 13“Stock Award Plans” in Part IV, Item 15 of our Annual Report on Form 10-K for the year ended December 31, 2007. Mr. Waldron received an option award of 70,000 shares of SciClone’s common stock at an exercise price per share of $2.69, the closing price on the NASDAQ National Market of a share of SciClone’s common stock on March 20, 2007. Mr. Schmid received an option award of 70,000 shares of SciClone’s common stock at an exercise price per share of $2.69, the closing price on the NASDAQ National Market of a share of SciClone’s common stock on March 20, 2007. Mr. Hui received an option award of 35,000 shares of SciClone’s common stock at an exercise price per share of $2.69, the closing price on the NASDAQ National Market of a share of SciClone’s common stock on March 20, 2007. |
(3) | Reflects incentive cash compensation paid to our executive officers under our executive incentive plan, earned for performance in the year indicated, although such non-equity incentive plan compensation is generally paid in the year following performance. Performance-based bonuses are generally paid under our executive incentive plan and reported as Non-Equity Incentive Plan Compensation. Except as otherwise noted, amounts reported as Bonus represent discretionary bonuses awarded by the Compensation Committee in addition to the amount (if any) earned under our executive incentive plan. |
(4) | Reflects all other compensation paid in 2007 and 2006 respectively. Dr. Blobel’s “all other compensation” during 2007 included $10,250 for matching contributions under our 401(k) plan and $2,322 for life insurance |
premiums. Mr. Waldron’s “all other compensation” during 2007 included $10,250 for matching contributions under our 401(k) plan and $1,242 for life insurance premiums. Mr. Schmid’s “all other compensation” during 2007 included $10,250 for matching contributions under our 401(k) plan and $2,322 for life insurance premiums. Mr. Hui’s “all other compensation” during 2007 included $7,750 for matching contributions under our 401(k) plan and $682 for life insurance premiums. For 2006, Dr. Blobel’s “all other compensation” included $10,000 for matching contributions under our 401(k) plan. In addition, Dr. Blobel consulted with the Company between the April 23, 2006 and June 2, 2006 for a payment of $30,000. Mr. Waldron’s “all other compensation” during 2006 included $10,000 for matching contributions under the Company’s 401(k) plan. Mr. Schmid’s “all other compensation” during 2006 included $10,000 for matching contributions under the Company’s 401(k) plan. |
(5) | Mr. Waldron’s employment with us terminated effective April 30, 2008. Amounts earned during 2007 reflect salary earned, a one-time cash bonus for his efforts in concluding the RP101 transaction of $15,000, and benefits received for the full year ended December 31, 2007. |
(6) | Mr. Hui was not a Named Executive Officer for the Fiscal Year ended December 31, 2006. |
Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | All Other Option Awards: Number of Securities Underlying Options(#)(3) | Exercise or Base Price of Option Awards ($) | Grant Date Fair Value of Stock and Option Awards ($)(4) | |||||||||||||||||||||||||||
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Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | ||||||||||||||||||||||||||
Friedhelm Blobel, Ph.D.(2) | 2/23/07 | — | 170,000 | 255,000 | ||||||||||||||||||||||||||
Richard A. Waldron | 2/23/07 | — | 103,500 | 155,250 | ||||||||||||||||||||||||||
3/20/07 | 70,000 | 2.69 | 112,931 | |||||||||||||||||||||||||||
Hans P. Schmid | 2/23/07 | — | 90,000 | 135,000 | ||||||||||||||||||||||||||
3/20/07 | 70,000 | 2.69 | 112,931 | |||||||||||||||||||||||||||
Ivan Hui | 2/23/07 | — | 33,522 | 33,522 | ||||||||||||||||||||||||||
3/20/07 | 35,000 | 2.69 | 56,465 |
(1) | We award bonuses pursuant to an annual executive incentive plan, which provides for the award of annual cash bonuses based upon achievement of objectives established by the Compensation Committee at the beginning of each fiscal year. See“Compensation Discussion and Analysis — Elements of Compensation and How Each Element is Chosen, Annual Incentive Compensation.” The actual amount paid to each Named Executive Officer for the fiscal years ended December 31, 2006 and 2007 is set forth in the Summary Compensation Table under the heading,“Non-Equity Incentive Plan Compensation.” Under our executive incentive plan, cash bonuses are paid to executive officers based upon achievement of corporate and individual objectives. The performance of executive officers is measured against achievement of these objectives after the fiscal year ends. Achievement of target for each measure represents performance entitling the executive officer to payment of the full target bonus established as a percentage of such officer’s base salary for the fiscal year; performance that is evaluated as being less than or greater than target results in a increase or decrease, as applicable, in amount of bonus payable to such officer. The total bonus payable to each executive officer shall not exceed 150% of such officer’s annual base salary, and so the maximum amount payable is 150% of such target amount. There is no minimum performance required before bonuses are payable; accordingly there are no thresholds under the plan. |
(2) | Dr. Blobel did not receive an option award in Fiscal 2007. |
(3) | Amounts shown represent options issued under our 2005 Equity Incentive Plan. Contingent upon the executive’s continued employment, one-quarter of the options vest twelve months following the grant date and the balance vest monthly over the following three years. The exercise price for the options equals the closing price of our common stock on the date of grant. Each option has a maximum term of ten years. The options granted to all of our Named Executive Officers, other than Mr. Hui, will vest on an accelerated basis upon the executive’s termination of employment under certain prescribed circumstances. Additional information regarding the vesting acceleration provisions applicable to equity awards granted to our Named Executive Officers is included in this proxy statement under the heading“Potential Payments upon Termination or Change in Control.” |
(4) | The dollar value of the options shown represents the grant date fair value estimated using the Black-Scholes option pricing model to determine grant date fair value, in accordance with the provisions of SFAS 123R, excluding the impact of estimated forfeitures related to service-based vesting conditions. For a discussion of valuation assumptions used in the SFAS 123R calculations, see Note 1 of Notes to Consolidated Financial Statements,“The Company and Summary of Significant Accounting Policies — Stock-Based Compensation” and Note 13,“Stockholders’ Equity — Stock Award Plans,” included in Part IV, item 15 of our Annual Report on Form 10-K for the year ended December 31, 2007. The actual value, if any, that an executive may realize on each option will depend on the excess of the stock price over the exercise price on the date the option is exercised and the shares underlying such option are sold. There is no assurance that the actual value realized by an executive will be at or near the value estimated by the Black-Scholes model. |
Number of Securities Underlying Unexercised Options (#) | Number of Securities Underlying Unexercised Options (#)(1) | Option Exercise Price ($) | Option Expiration Date | |||||||||||||||
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Name | Exercisable | Unexercisable | ||||||||||||||||
Friedhelm Blobel, Ph.D.(2) | 100,000 | 900,000 | $ | 2.49 | 06/02/16 | |||||||||||||
Richard A. Waldron | 275,000 | 0 | 3.688 | 03/16/11 | ||||||||||||||
65,000 | 0 | 4.25 | 04/08/12 | |||||||||||||||
75,000 | 0 | 5.83 | 04/04/13 | |||||||||||||||
30,000 | 2,000 | 5.65 | 03/19/14 | |||||||||||||||
42,000 | 6,000 | 5.00 | 06/01/14 | |||||||||||||||
50,000 | 0 | 3.68 | 09/10/14 | |||||||||||||||
49,583 | 20,417 | 3.24 | 02/25/15 | |||||||||||||||
22,917 | 27,083 | 2.34 | 02/23/16 | |||||||||||||||
0 | 70,000 | 2.69 | 03/20/17 | |||||||||||||||
Hans P. Schmid | 100,000 | 0 | 4.70 | 05/21/11 | ||||||||||||||
30,000 | 0 | 4.25 | 04/08/12 | |||||||||||||||
40,000 | 0 | 5.83 | 04/04/13 | |||||||||||||||
16,875 | 1,125 | 5.65 | 03/19/14 | |||||||||||||||
23,625 | 3,375 | 5.00 | 06/01/14 | |||||||||||||||
8,125 | 1,875 | 3.77 | 09/15/14 | |||||||||||||||
46,042 | 18,958 | 3.40 | 02/04/15 | |||||||||||||||
27,500 | 32,500 | 2.34 | 02/23/16 | |||||||||||||||
0 | 70,000 | 2.69 | 03/20/17 | |||||||||||||||
Ivan Hui | 7,500 | 0 | 2.25 | 03/06/08 | ||||||||||||||
7,000 | 0 | 2.38 | 08/18/08 | |||||||||||||||
10,000 | 0 | 1.59 | 02/25/09 | |||||||||||||||
15,000 | 0 | 1.22 | 07/02/09 | |||||||||||||||
10,000 | 0 | 1.50 | 08/20/09 | |||||||||||||||
20,000 | 0 | 10.75 | 08/21/10 | |||||||||||||||
17,000 | 0 | 3.688 | 03/16/11 | |||||||||||||||
20,000 | 0 | 4.25 | 04/08/12 | |||||||||||||||
24,000 | 0 | 5.83 | 04/04/13 | |||||||||||||||
9,750 | 650 | 5.65 | 03/19/14 | |||||||||||||||
13,650 | 1,950 | 5.00 | 06/01/14 | |||||||||||||||
21,250 | 8,750 | 3.40 | 02/04/15 | |||||||||||||||
18,333 | 21,667 | 2.34 | 02/23/16 | |||||||||||||||
0 | 35,000 | 2.69 | 03/20/17 |
(1) | Except as otherwise noted, each option vests at the rate of 1/4 of the underlying shares on the first anniversary of the date of grant and 1/48 of the shares each month thereafter. Vesting may accelerate under certain circumstances for certain options, as described in“Potential Payments upon Termination or Change-in-Control” elsewhere in this“Executive Compensation and Other Matters” section of this proxy statement on Schedule 14A. |
(2) | Dr. Blobel was granted options subject to our standard vesting in addition to awards with performance based vesting as described in “Elements of Our Compensation Program and How Each Element is Chosen —Long-Term Equity Incentives” elsewhere in this“Executive Compensation and Other Matters” section of this proxy statement on Schedule 14A. |
conviction (including any plea of guilty or no contest) for any criminal act that impairs his ability to perform his duties for SciClone; or (vi) his death or disability.
(1) | “Change in Control” is defined as any of the following: |
• | a merger or other transaction in which we or substantially all of our assets are sold or merged and as a result of such transaction, the holders of our common stock prior to such transaction do not own or control a majority of the outstanding shares of the successor corporation; |
• | the election of nominees constituting a majority of the Board which nominees were not approved by a majority of the Board prior to such election; or |
• | the acquisition by a third party of twenty percent (20%) or more of our outstanding shares which acquisition was without the approval of a majority of the Board in office prior to such acquisition. |
(2) | “Cause” is defined as any of the following: |
• | theft, dishonesty, misconduct or falsification of any records; |
• | misappropriation or improper disclosure of confidential or proprietary information; |
• | any intentional action by Employee which has a material detrimental effect on the reputation or business of the Company Group; |
• | failure or inability to perform any reasonable assigned duties after written notice and a reasonable opportunity to cure, such failure or inability; |
• | any material breach of any employment agreement, which breach is not cured pursuant to the terms of such agreement; or |
• | the conviction of any criminal act which impairs their ability to perform their duties |
(3) | “Constructive Termination” is defined as any of the following: |
• | the assignment of any title or duties, or any limitation of responsibilities, that are substantially inconsistent with either of their title(s), duties, or responsibilities immediately prior to the date of the Change in Control (including, but not limited to, failure to report to the Chief Executive Officer and/or failure to be a member of the executive staff); |
• | without their express written consent, the relocation of the principal place of employment, following the Change in Control, to a location that is more than fifty (50) miles from their principal place of employment immediately prior to the date of the Change in Control, or the imposition of travel requirements substantially more demanding than such travel requirements existing immediately prior to the date of the Change in Control; |
• | any failure, following the Change in Control, to pay, or any material reduction of, (1) their base salary in effect immediately prior to the date of the Change in Control, or (2) bonus compensation, if any, in effect immediately prior to the date of the Change in Control, unless base salary and/or bonus reductions comparable in amount and duration are concurrently made for a majority of our other employees who have substantially similar titles and responsibilities; and |
• | any failure, following the Change in Control, to (1) continue to provide the opportunity to participate in any benefit or compensation plans and programs, including, but not limited to, our Group life, |
disability, health, dental, medical, savings, profit sharing, stock purchase and retirement plans, if any, in which they were participating immediately prior to the date of the Change in Control, or in substantially similar plans or programs, or (2) provide them with all other fringe benefits (or substantially similar benefits), including, but not limited to, relocation benefits which they were receiving immediately prior to the date of the Change in Control. |
Name | Involuntary Termination Other Than for Cause(1) | Termination Following Change in Control(2) | ||||||||
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Friedhelm Blobel, Ph.D. | ||||||||||
Salary(3) | $ | 425,000 | (4) | $ | 637,500 | (5) | ||||
Stock award vesting acceleration(6) | — | 0 | (7) | |||||||
Post-termination consulting fees | — | $ | 24,000 | (8) | ||||||
Health and welfare benefits(9) | $ | 9,758 | $ | 9,758 | ||||||
Total | $ | 434,758 | $ | 671,258 | ||||||
Hans P. Schmid | ||||||||||
Salary(3) | $ | 300,000 | (10) | $ | 300,000 | (10) | ||||
Stock award vesting acceleration(6) | — | 0 | (11) | |||||||
Post-termination consulting fees | — | $ | 24,000 | (12) | ||||||
Health and welfare benefits | — | $ | 54,155 | (13) | ||||||
Total | $ | 300,000 | $ | 378,155 |
(1) | Assumes termination without cause as of December 31, 2007 (the last business day of the last fiscal year), not within one year after a change in control. For purposes of Dr. Blobel, “cause” includes constructive termination. As a condition to receiving any benefits referenced under this column, the applicable Named Executive Officer is required to execute a general release of known and unknown claims in a form satisfactory to us. |
(2) | Assumes termination without cause as of December 31, 2007, within one year after a change in control. For purposes of the foregoing sentence, “cause” includes constructive termination. As a condition to receiving any benefits referenced under this column, the applicable Named Executive Officer is required to execute a general release of known and unknown claims and a resignation from all of the Named Executive Officer’s positions with us, including from the Board of Directors and any committees thereof on which the Named Executive Officer serves, if any, in a form satisfactory to us. |
(3) | The amounts listed does not include the payment of accrued salary and vacation that would be due upon termination of employment, and are not adjusted for any applicable tax withholding. |
(4) | Assumes severance equal to 12 months of Dr. Blobel’s base salary ($425,000 per year as of December 31, 2007). |
(5) | Assumes severance equal to 150% of Dr. Blobel’s annual base salary ($425,000 per year as of December 31, 2007). |
(6) | Assumes a price per share of our common stock equal to $2.06, the closing market price on December 31,2007. In the case of stock options, represents the aggregate spread (i.e. the difference between the exercise price and the closing price of our common stock on December 31, 2007) with respect to all options that would be accelerated (or were actually accelerated, if applicable); in the case of shares of common stock, represents the aggregate value of all shares that would be accelerated (or were actually accelerated, if applicable). |
(7) | Assumes acceleration of 300,000 unvested options at an exercise price of $2.49 as of December 31, 2007, equal to the then-unvested portion of Dr. Blobel’s initial option to purchase 400,000 shares of Common Stock that was issued on June 2, 2006. In addition, in the event of a termination without cause within one year after a change in control, the exercise period for any unexercised nonstatutory stock options then-held by Dr. Blobel would be extended to be 12 months after the date of such termination. |
(8) | Under his Change of Control Agreement, Dr. Blobel would be retained by us as an independent contractor to provide consulting services at our request for up to five (5) hours per week for three (3) months after December 31, 2007, pursuant to which we will pay to executive officer a consulting fee of $400.00 per hour, up to a maximum of $2,500.00 per day, plus reasonable out-of-pocket expenses (for example, travel and lodging). Assumes the maximum amount payable under this arrangement (five hours per week for three months), but no out-of-pocket expenses. |
(9) | Under his Employment Agreement and his Change of Control Agreement, if Dr. Blobel is covered under our group health plan as of the date of termination without cause (whether or not within one year after a change of control) and he timely elects to continue his group health benefits pursuant to federal law (COBRA), we will pay the COBRA premiums until the earlier of (A) the one year anniversary of Dr. Blobel’s termination without cause, or (B) the date on which Dr. Blobel commences new employment. If we are paying for health coverage of Dr. Blobel under another plan, we will continue to make payments (not to exceed the amount paid in the prior calendar year) for such coverage for the period specified in the prior sentence. Assumes our payment of all premiums necessary to cover Dr. Blobel from December 31, 2007 to December 31, 2008, assuming that Dr. Blobel was covered under our group health plan as of December 31, 2007, and that if he were terminated without cause as of such date, he timely elected to continue such benefits until December 31, 2008, calculated assuming that such premiums remain at the amounts in effect as of December 31, 2007. |
(10) | Assumes severance equal to 12 months of Mr. Schmid’s base salary ($300,000 per year as of December 31, 2007). |
(11) | Assumes acceleration of vesting of all options held by the executive officer as of December 31, 2007 but unvested as of such date, as described in the executive officer’s Change in Control Agreement. |
(12) | Under his Change of Control Agreement, the executive officer would be retained by the Company as an independent contractor to provide consulting services to the Company at its request for up to eight (8) hours per week for twenty-four (24) months after December 31, 2007, pursuant to which the Company will pay to executive officer a consulting fee of $1,000 per day, plus reasonable out-of-pocket expenses (for example, travel and lodging). Assumes the maximum amount payable under this arrangement (one eight-hour day per week for twenty-four weeks), but no out-of-pocket expenses. |
(13) | In the event of the executive officer’s termination without cause, for two (2) years after such termination, the Company will pay the premiums to continue the executive officer’s group health insurance coverage under COBRA so long as he timely elects COBRA coverage. Assumes our payment of all premiums necessary to cover the executive officer from December 31, 2007 until December 31, 2009, assuming that the executive officer timely elected COBRA coverage upon a termination without cause as of December 1, 2007, calculated assuming that such premiums remain at the amounts in effect as of December 31, 2007. |
• | Receipt of improper personal benefits as a result of the person’s (or family member’s) position in the Company; |
• | Use of the Company’s property for the person’s (or family member’s) personal benefit except pursuant to an express agreement or understanding with the Company; |
• | Having a financial interest in a customer, supplier, or competitor which is significant enough to cause divided loyalty with the Company or the appearance of divided loyalty (the significance of a financial interest depends on many factors, such as size of investment in relation to the person’s (or family member’s) income, net worth and/or financial needs, the person’s (or family member’s) potential to influence decisions that could impact interests, and the nature of the business or level of competition between the Company and the supplier, customer or competitor); |
• | The person’s (or family member’s) acquisition of an interest in property (such as real estate, patent or other intellectual property rights or securities) in which the person (or family member) has reason to know the Company has, or might have, a legitimate interest; |
• | Receiving a loan or a guarantee of a loan from a customer, supplier or competitor (other than a loan from a financial institution made in the ordinary course of business and on an arm’s-length basis); |
• | Divulging or using the Company’s confidential information — such as financial data, customer information, or computer programs — for the person’s (or family member’s) own personal or business purposes; |
• | Making gifts or payments, or providing special favors, to customers, suppliers or competitors (or their immediate family members) with a value significant enough to cause the customer, supplier or competitor to make a purchase, or take or forego other action, which is beneficial to the Company and which the customer, supplier or competitor would not otherwise have taken; or |
• | Being given the right to buy stock in other companies or receiving cash or other payments in return for promoting the services of an advisor, such as an investment banker, to the Company. |
EQUITY COMPENSATION PLAN INFORMATION
Plan Category | Number of shares to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted- average exercise price of outstanding options, warrants and rights (b) | Number of shares remaining available for future issuance under equity compensation plans (excluding shares reflected in column (a)) (c) | |||||||||||
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Equity compensation plans approved by stockholders: | ||||||||||||||
1991 Stock Plan | 130,200 | $ | 6.35 | — | ||||||||||
1992 Stock Plan | 73,000 | $ | 5.79 | — | ||||||||||
1995 Equity Incentive Plan | 2,381,914 | $ | 5.03 | — | ||||||||||
1995 Nonemployee Director Stock Option Plan | 310,000 | $ | 6.57 | — | ||||||||||
1996 Employee Stock Purchase Plan | — | — | 282,519 | (1) | ||||||||||
2004 Outside Directors Stock Option Plan | 665,000 | $ | 3.32 | 1,100,000 | ||||||||||
2005 Equity Incentive Plan | 3,622,791 | $ | 2.72 | 4,142,916 | ||||||||||
Total | 7,182,905 | $ | 3.81 | 5,525,435 |
(1) | The 1996 Employee Stock Purchase Program is a voluntary plan open to all employees. This plan allows employees to elect payroll deductions which are used to purchase common stock directly from us. |
REPORT OF THE AUDIT COMMITTEE
YEAR 2009 STOCKHOLDER PROPOSALS
President and Chief Executive Officer
May 2, 2008
A VoteFOR the following proposals is recommended by the Board of Directors:
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| 1. To elect the following seven (7) directors of the Company: | o |
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| (INSTRUCTION: To withhold authority to vote for any individual nominee, strike a line through that nominee’s name in the list below.) | |||
| 01 Dean S. Woodman | 05 Rolf H. Henel |
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| WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, YOU ARE URGED TO PROMPTLY VOTE THIS PROXY SO THAT YOUR STOCK MAY BE REPRESENTED AT THE MEETING. |
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| FOR | AGAINST | ABSTAIN |
2. To ratify the appointment of Ernst & Young LLP as the in dependent registered public accounting firm for the Company for the fiscal year ending December 31, 2008. | o | o | o |
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MARK HERE IF YOU PLAN TO ATTEND THE MEETING | o |
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WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE VOTING,
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK.
Internet and telephone voting is available through 11:59 PM Eastern Time
the day prior to annual meeting day.
Your Internet or telephone vote authorizes the named proxies to vote your shares in the same manner
as if you marked, signed and returned your proxy card.
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INTERNET | OR | TELEPHONE |
http://www.proxyvoting.com/scln | 1-866-540-5760 | |
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If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy card.
To vote by mail, mark, sign and date your proxy card and return it in the enclosed postage-paid envelope.
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ChooseMLinkSMfor fast, easy and secure 24/7 online access to your future proxy materials, investment plan statements, tax documents and more. Simply log on toInvestor ServiceDirect®atwww.bnymellon.com/shareowner/isd where step-by-step instructions will prompt you through enrollment. | ||||||
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SCICLONE PHARMACEUTICALS, INC. | ||||
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The undersigned hereby appoints Friedhelm Blobel, Ph.D. and Hans P. Schmid, and each of them, with full power of substitution, to represent the undersigned and to vote all of the shares of stock in SciClone Pharmaceuticals, Inc., a Delaware corporation (the “Company”), which the undersigned is entitled to vote at the Annual Meeting of Stockholders of the Company to be held at the Marriott San Mateo/San Francisco Airport at 1770 S. Amphlett Blvd., San Mateo, California 94402 on Tuesday, June 10, 2008, at 10:00 a.m. local time, and at any adjournment or postponement thereof (1) as hereinafter specified upon the proposals listed on the reverse side and as more particularly described in the Proxy Statement of the Company (the “Proxy Statement”), receipt of which is hereby acknowledged, and (2) in their discretion upon such other matters as may properly come before the meeting. The undersigned hereby acknowledges receipt of the Company's 2007 Annual Report to Stockholders. |
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SEE REVERSE | CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE | SEE REVERSE |
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| Address Change/Comments(Mark the corresponding box on the reverse side) |
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You can now access your SciClone Pharmaceuticals, Inc. account online.
Access your SciClone Pharmaceuticals, Inc. stockholder account online via Investor ServiceDirect®(ISD).
The transfer agent for SciClone Pharmaceuticals, Inc., now makes it easy and convenient to get current in formation on your stockholder account.
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• View account status |
| • View payment history for dividends |
• View certificate history |
| • Make address changes |
• View book-entry information |
| • Obtain a duplicate 1099 tax form |
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| • Establish/change your PIN |
Visit us on the web at http://www.bnymellon.com/shareowner/isd
For Technical Assistance Call 1-877-978-7778 between 9am-7pm
Monday-Friday Eastern Time
TOLL FREE NUMBER: 1-877-897-6928