04/29/2024 | Press release | Distributed by Public on 04/29/2024 12:34
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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No fee required
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Fee paid previously with preliminary materials
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Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11
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1.
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To elect six director nominees named in the accompanying Proxy Statement to serve until the 2025 Annual Meeting of Stockholders and until their successors are duly elected and qualified;
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2.
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To ratify the appointment of Withum Smith+Brown, PC ("Withum") as our independent registered public accounting firm for the fiscal year ending December 31, 2024;
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3.
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To approve, on a nonbinding advisory basis, compensation paid to our Named Executive Officers during the fiscal year ended December 31, 2023;
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4.
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To amend the Company's Certificate of Incorporation, as amended (the "Certificate of Incorporation") to increase the aggregate number of authorized shares of the Company's common stock, par value $0.01 per share ("common stock") by 175,000,000 from 225,000,000 to 400,000,000;
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5.
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To amend the Company's 2007 Amended and Restated Equity Incentive Plan (the "2007 Plan"), to increase the number of shares of common stock authorized for issuance thereunder by 7,500,000 from 39,190,000 to 46,690,000;
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6.
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To amend the Company's 1997 Employee Stock Purchase Plan, as amended (the "ESPP"), to increase the number of shares of common stock authorized for issuance thereunder by 1,200,000 from 2,225,000 to 3,425,000; and
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7.
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To transact such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof.
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BY ORDER OF THE BOARD OF DIRECTORS
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/s/ Ira Duarte
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San Diego, California
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April 29, 2024
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Proposal 1: To elect six director nominees named in this Proxy Statement to serve until the 2025 Annual Meeting of Stockholders and until their successors are duly elected and qualified;
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Proposal 2: To ratify the appointment of Withum as our independent registered public accounting firm for the fiscal year ending December 31, 2024;
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Proposal 3: To approve, on a nonbinding advisory basis, compensation paid to our Named Executive Officers during the fiscal year ended December 31, 2023;
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Proposal 4: To amend the Company's Certificate of Incorporation to increase the aggregate number of authorized shares of common stock by 175,000,000 from 225,000,000 to 400,000,000;
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Proposal 5: To amend the 2007 Plan to increase the number of shares of common stock authorized for issuance thereunder by 7,500,000 from 39,190,000 to 46,690,000; and
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Proposal 6: To amend the ESPP to increase the number of shares of common stock authorized for issuance thereunder by 1,200,000 from 2,225,000 to 3,425,000.
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FOR the six director nominees to serve until the 2025 Annual Meeting of Stockholders and until their successors are duly elected and qualified;
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FOR the ratification of the appointment of Withum as our independent registered public accounting firm for the fiscal year ending December 31, 2024;
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FOR the approval, on a nonbinding advisory basis, compensation paid to our Named Executive Officers during the fiscal year ended December 31, 2023;
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FOR the amendment of the Company's Certificate of Incorporation to increase the aggregate number of authorized shares of common stock by 175,000,000 from 225,000,000 to 400,000,000;
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FOR the amendment of the 2007 Plan to increase the number of shares of common stock authorized for issuance thereunder by 7,500,000 from 39,190,000 to 46,690,000; and
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FOR the amendment of the ESPP to increase the number of shares of common stock authorized for issuance thereunder by 1,200,000 from 2,225,000 to 3,425,000.
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To vote during the Annual Meeting, see the instructions on how to vote while participating in the Annual Meeting via the Internet at http://www.virtualshareholdermeeting.com/HRTX2024.
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To vote via the Internet, go to www.proxyvote.com, 24 hours per day, 7 days per week. You will need the 16-digit control number included on your proxy card. Proxies submitted through the Internet must be received by 11:59 p.m. Eastern Time on June 12, 2024.
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To vote by telephone, call toll free 1-800-690-6903, 24 hours per day, 7 days per week. You will need the 16-digit control number included on your proxy card. Proxies submitted through the Internet must be received by 11:59 p.m. Eastern Time on June 12, 2024.
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To vote using the proxy card, simply complete, sign and date the proxy card included with your proxy materials and return it promptly in the envelope provided. If you return your signed and dated proxy card to us before the Annual Meeting with your voting selections, we will vote your shares as you direct. Except for votes cast for shares registered in the name of a broker, bank or other agent (as described below), if you return your signed and dated proxy card to us before the Annual Meeting without your voting selections, proxies named in the proxy card will vote your shares in accordance with the Board's recommendations (as described above).
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you may submit another properly completed proxy with a later date;
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you may vote again by Internet or telephone at a later time;
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you may send a written notice that you are revoking your proxy to our Corporate Secretary at 4242 Campus Point Court, Suite 200, San Diego, California 92121; or
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you may attend the Annual Meeting and vote electronically during the Annual Meeting (however, simply attending the Annual Meeting will not, by itself, revoke your proxy or change your vote).
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Proposal 1: Director nominees, in uncontested elections, shall be elected by a majority of the votes properly cast with respect to that director nominee, provided a quorum is established.
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Proposal 2: The proposal to ratify the appointment of Withum as our independent registered public accounting firm for the year ending December 31, 2024 requires the affirmative vote of a majority of the votes properly cast on the proposal, provided a quorum is established.
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Proposal 3: The proposal to approve, on a nonbinding, advisory basis, the compensation paid to our Named Executive Officers requires the affirmative vote of a majority of the votes properly cast on the proposal, provided a quorum is established.
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Proposal 4: The proposal to approve an amendment to our Certificate of Incorporation to increase the aggregate number of authorized shares of common stock by 175,000,000 from 225,000,000 to 400,000,000 requires the affirmative vote of a majority of the votes properly cast on the proposal, provided a quorum is established.
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Proposal 5: The proposal to amend our 2007 Plan requires the affirmative vote of a majority of the votes properly cast on the proposal, provided a quorum is established.
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Proposal 6: The proposal to amend our ESPP requires the affirmative vote of a majority of the votes properly cast on the proposal, provided a quorum is established.
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Name
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Age
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Position
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Director
Since
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Craig Collard
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58
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Chief Executive Officer and Director
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2023
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Sharmila Dissanaike, M.D., FACS, FCCM
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49
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Director
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2021
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Craig Johnson
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62
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Director
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2014
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Adam Morgan
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45
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Chairman of the Board
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2023
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Susan Rodriguez
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60
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Director
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2021
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Christian Waage
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57
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Director
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2016
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Name
|
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Age
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Position
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Officer
Since
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Craig Collard
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58
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Chief Executive Officer and Director
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2023
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Ira Duarte
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55
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Executive Vice President, Chief Financial Officer
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2023
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William Forbes
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62
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Executive Vice President, Chief Development Officer
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2023
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Name
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Audit
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Compensation
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Governance
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Craig Collard
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Sharmila Dissanaike, M.D., FACS, FCCM
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C
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X
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Craig Johnson
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C
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X
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Adam Morgan
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X
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Susan Rodriguez
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X
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X
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Christian Waage
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X
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C
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Board Diversity Matrix (As of April 1, 2024)
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Total Number of Directors
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6
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Female
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Male
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Non-
Binary
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Did Not
Disclose
Gender
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Part I: Gender Identity
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Directors
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2
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4
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-
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-
|
|
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Part II: Demographic Background
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African American or Black
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| |
-
|
| |
-
|
| |
-
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| |
-
|
|
|
Alaskan Native or Native American
|
| |
-
|
| |
-
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| |
-
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| |
-
|
|
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Asian
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1
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| |
-
|
| |
-
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| |
-
|
|
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Hispanic or Latinx
|
| |
1
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| |
-
|
| |
-
|
| |
-
|
|
|
Native Hawaiian or Pacific Islander
|
| |
-
|
| |
-
|
| |
-
|
| |
-
|
|
|
White
|
| |
-
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| |
4
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| |
-
|
| |
-
|
|
|
Two or More Races or Ethnicities
|
| |
-
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| | | |
-
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| |
-
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| |
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LGBTQ+
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-
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Did Not Disclose Demographic Background
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-
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|
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Board Diversity Matrix (As of April 1, 2023)
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Total Number of Directors
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7
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Female
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Male
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Non-
Binary
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Did Not
Disclose
Gender
|
| |
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Part I: Gender Identity
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Directors
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2
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5
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-
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-
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Part II: Demographic Background
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African American or Black
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-
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| |
-
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-
|
| |
-
|
|
|
Alaskan Native or Native American
|
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-
|
| |
-
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| |
-
|
| |
-
|
|
|
Asian
|
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1
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| |
-
|
| |
-
|
| |
-
|
|
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Hispanic or Latinx
|
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1
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-
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-
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-
|
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Native Hawaiian or Pacific Islander
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-
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-
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| |
-
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| |
-
|
|
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White
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-
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5
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-
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-
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Two or More Races or Ethnicities
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-
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-
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-
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LGBTQ+
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-
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Did Not Disclose Demographic Background
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-
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Name and Address
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Amount and
Nature of
Beneficial
Ownership
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Percent of
Class
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Greater than 5% Holders(1)
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Rubric Capital Management LP(2)
155 East 44th St, Suite
1630 New York,
New York 10017
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26,713,503
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17.77%
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Vanguard Group Inc.(3)
100 Vanguard Blvd.
Malvern, PA 19355
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8,338,912
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5.55%
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Name
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Title
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Amount and
Nature of
Beneficial
Ownership
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Percentage
of
Class
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Craig Collard(4)
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Chief Executive Officer and Director
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1,176,408
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*
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Sharmila Dissanaike, M.D.(5)
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Director
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68,447
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*
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Ira Duarte(6)
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Chief Financial Officer
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104,372
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*
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William Forbes(7)
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Chief Development Officer
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98,372
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*
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Craig Johnson(8)
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Director
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65,819
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*
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Adam Morgan(9)
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Chairman of the Board
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7,080,026
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4.71%
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Barry Quart, Pharm. D.(10)
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Former Chairman and Chief Executive Officer
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177,989
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*
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Susan Rodriguez(11)
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Director
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68,447
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*
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David Szekeres(12)
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Former Executive Vice President, Chief Operating Officer
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33,754
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*
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Christian Waage(13)
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Director
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66,179
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*
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Current Executive Officers and Directors as a group (8 persons)(14)
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8,728,070
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5.76%
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*
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Indicates ownership of less than one percent.
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(1)
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As applicable, the number of shares of common stock listed as owned by a beneficial holder relies on public filings by such beneficial holder and the number of shares of common stock reported as beneficially owned.
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(2)
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Based on information set forth in a Schedule 13D/A filed with the SEC on July 25, 2023 by Rubric Capital Management LP and David Rosen. Mr. Rosen is the Managing Member of Rubric Capital Management GP LLC, the general partner of Rubric Capital Management LP. The Schedule 13D/A indicates that Rubric Capital Management LP and David Rosen have shared voting and dispositive power with respect to 26,713,503 shares of common stock.
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(3)
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Based on information set forth in a Schedule 13G/A filed with the SEC on February 13, 2024 by Vanguard Group Inc. reporting
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(4)
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Consists of 220,587 shares of common stock, 877,157 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024 and 78,664 shares of common stock underlying restricted stock units vesting within 60 days of March 31, 2024.
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(5)
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Consists of 52,938 shares of common stock and 15,509 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024.
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(6)
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Consists of 85,000 shares of common stock, 15,498 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024 and 3,874 shares of common stock underlying restricted stock units vesting within 60 days of March 31, 2024.
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(7)
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Consists of 79,000 shares of common stock, 15,498 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024 and 3,874 shares of common stock underlying restricted stock units vesting within 60 days of March 31, 2024.
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(8)
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Consists of 51,872 shares of common stock and 13,947 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024.
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(9)
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Consists of 7,054,242 shares of common stock (inclusive of (i) 6,986,744 shares and (ii) 58,028 pre-funded warrants to purchase common stock held indirectly through Velan Capital Master Fund LP), 23,417 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024 and 2,367 shares of common stock underlying restricted stock units vesting within 60 days of March 31, 2024.
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(10)
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Consists of 177,989 shares of common stock.
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(11)
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Consists of 52,938 shares of common stock and 15,509 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024.
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(12)
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Consists of 33,754 shares of common stock.
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(13)
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Consists of 52,232 shares of common stock and 13,947 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024.
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(14)
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Consists of 7,648,809 shares of common stock, 990,482 shares of common stock underlying stock options exercisable within 60 days of March 31, 2024 and 88,779 shares of common stock underlying restricted stock units vesting within 60 days of March 31, 2024.
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•
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Craig Collard, Chief Executive Officer;
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•
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Ira Duarte, Chief Financial Officer;
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•
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William Forbes, Chief Development Officer;
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•
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Barry Quart, Pharm.D., Former Chairman and Chief Executive Officer; and
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•
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David Szekeres, Former Executive Vice President, Chief Operating Officer.
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Name and Principal Position
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Year
|
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Salary
|
| |
Stock
Awards(1)
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Option
Awards(1)
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Non-Equity
Incentive Plan
Compensation(2)
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All Other
Compensation(3)
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Total
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Craig Collard(4),(6)
Chief Executive Officer
|
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2023
|
| |
$492,986
|
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$547,273
|
| |
$9,257,049
|
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$326,957
|
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$151,553
|
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$10,775,818
|
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2022
|
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$-
|
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$-
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$-
|
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$-
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$-
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$-
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Ira Duarte(4)
Chief Financial Officer
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2023
|
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$271,154
|
| |
$60,500
|
| |
$1,066,875
|
| |
$128,844
|
| |
$7,500
|
| |
$1,534,873
|
|
2022
|
| |
$-
|
| |
$-
|
| |
$-
|
| |
$-
|
| |
$-
|
| |
$-
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William Forbes(4)
Chief Development Officer
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2023
|
| |
$329,519
|
| |
$55,500
|
| |
$917,433
|
| |
$155,654
|
| |
$-
|
| |
$1,458,106
|
|
2022
|
| |
$-
|
| |
$-
|
| |
$-
|
| |
$-
|
| |
$-
|
| |
$-
|
||
Barry Quart, Pharm.D.(4),(5)
Former Chief Executive Officer
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| |
2023
|
| |
$188,501
|
| |
$788,615
|
| |
$1,625,625
|
| |
$-
|
| |
$1,427,606
|
| |
$4,030,347
|
|
2022
|
| |
$736,000
|
| |
$-
|
| |
$-
|
| |
$386,400
|
| |
$23,304
|
| |
$1,145,704
|
||
David Szekeres(4),(5)
Executive Vice President, Chief Commercial Officer
|
| |
2023
|
| |
$305,539
|
| |
$400,920
|
| |
$-
|
| |
$-
|
| |
$1,170,920
|
| |
$1,877,379
|
|
2022
|
| |
$533,013
|
| |
$441,456
|
| |
$235,482
|
| |
$199,880
|
| |
$19,400
|
| |
$1,429,231
|
(1)
|
This column represents the aggregate grant date fair value, computed in accordance with Financial Accounting Standards Board ("FASB") Accounting Standard Codification ("ASC") Topic 718, for stock awards and option awards granted to the Named Executive Officers in 2023 and 2022. The assumptions used in calculating the fair value of the stock awards and options can be found under Note 10 to the Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023. These amounts reflect the grant date fair value for these stock awards and option awards and do not necessarily correspond to the actual value that will be realized by the Named Executive Officers. For additional information on stock awards and options granted to the Named Executive Officers in 2023 and in prior years, and outstanding as of the end of fiscal 2023, see below under "Outstanding Equity Awards at Fiscal Year-End."
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(2)
|
The amounts listed represent cash awards earned for the year under the Company's annual cash incentive bonus program. For additional information regarding the annual cash incentive bonus program, see below under "Executive Compensation-Compensation Elements-Annual Cash Incentive Bonus."
|
(3)
|
"All Other Compensation" listed consist of our matching contributions on behalf of the named individual to our 401(k) Plan, a cash out of accrued vacation and the severance paid to our former executives in 2023 and a housing allowance provided to Mr. Collard.
|
(4)
|
The salary included in the table above is pro-rated for the portion of the year employed by the Company.
|
(5)
|
Dr. Quart ceased to serve as our Chief Executive Officer, Chairman of the Board, and as a director as of April 3, 2023. David Szekeres ceased to serve as our Executive Vice President, Chief Commercial Officer as of July 20, 2023. The departures of Dr. Quart and Mr. Szekeres were initiated by the company and they received severance compensation to which they were entitled by their respective pre-existing Employment Agreements, as amended, in Section 4.4 called Compensation Upon Termination.
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(6)
|
The compensation for Mr. Collard includes cash compensation of $5,486 and stock awards and option awards provided for Mr. Collard for his service as a member of the Board of Directors.
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Executive
|
| |
Principal Position
|
| |
2023 Base
Salary
|
| |
Base Salary
Increase %
|
| |
Adjusted Salary
For 2024
|
Craig Collard
|
| |
Chief Executive Officer
|
| |
$650,000
|
| |
3%
|
| |
$669,500
|
William Forbes
|
| |
Chief Development Officer
|
| |
$575,000
|
| |
3%
|
| |
$592,250
|
Ira Duarte
|
| |
Chief Financial Officer
|
| |
$500,000
|
| |
3%
|
| |
$515,000
|
Barry Quart
|
| |
Former Chief Executive Officer
|
| |
$758,080
|
| |
N/A
|
| |
N/A
|
David Szekeres
|
| |
Former Executive Vice President,
Chief Operating Officer
|
| |
$551,669
|
| |
N/A
|
| |
N/A
|
Executive
|
| |
Principal Position
|
| |
2023 Base
Salary
|
| |
2023
Target
|
| |
2023 Corporate
Performance
Achievement
|
| |
2023 Annual
Cash Incentive
Bonus
|
Craig Collard
|
| |
Chief Executive Officer
|
| |
$650,000
|
| |
75%
|
| |
90%
|
| |
$326,957
|
William Forbes
|
| |
Chief Development Officer
|
| |
$575,000
|
| |
50%
|
| |
95%
|
| |
$155,653
|
Ira Duarte
|
| |
Chief Financial Officer
|
| |
$500,000
|
| |
50%
|
| |
95%
|
| |
$128,843
|
Barry Quart
|
| |
Former Chief Executive Officer
|
| |
$758,080
|
| |
70%
|
| |
N/A
|
| |
N/A
|
David Szekeres
|
| |
Former Executive Vice President, Chief Operating Officer
|
| |
$551,669
|
| |
50%
|
| |
N/A
|
| |
N/A
|
Executive
|
| |
Performance-Based
Stock Unit
Award(1)
|
| |
Performance-Based
Stock Option
Award(2)
|
| |
Time-Based
Option
Award
|
| |
Time-Based
Restricted
Stock
Unit Award
|
Craig Collard
|
| |
-
|
| |
4,250,000
|
| |
3,227,272
|
| |
287,879
|
Ira Duarte
|
| |
-
|
| |
500,000
|
| |
800,000
|
| |
50,000
|
William Forbes
|
| |
-
|
| |
700,000
|
| |
500,000
|
| |
50,000
|
Barry Quart, Pharm.D.
|
| |
306,854
|
| |
-
|
| |
850,000
|
| |
-
|
David Szekeres
|
| |
156,000
|
| |
-
|
| |
-
|
| |
-
|
(1)
|
PSUs vest upon achievement of certain corporate performance goals and time-based vesting. The PSUs granted to the former Named Executive Officers were cancelled upon their respective terminations.
|
(2)
|
Performance stock options vest upon the Company's stock price reaching pre-established levels as specified in the grant agreement. The number of performance stock options that will vest is dependent upon the achievement of the pre-established levels of the Company's stock price.
|
| |
Number of Securities
Underlying
Unexercised Options
|
| |
Equity
Incentive
Plan
Awards:
|
| |
Option
Exercise
Price
($)
|
| |
Option
Grant
Date
|
| |
Option
Expiration
Date
|
||||
Name
|
| |
Exercisable
(#)
|
| |
Unexercisable
(#)
|
| |
Number of
securities
underlying
unexercised
unearned
options
(#)
|
| ||||||||
Craig Collard
|
| |
-
|
| |
-
|
| |
4,250,000(1)
|
| |
$1.78
|
| |
4/3/2023
|
| |
4/3/2033
|
| |
-
|
| |
224,716(2)
|
| |
-
|
| |
$1.78
|
| |
4/3/2023
|
| |
4/3/2033
|
|
| |
-
|
| |
2,775,284(3)
|
| |
-
|
| |
$1.78
|
| |
4/3/2023
|
| |
4/3/2033
|
|
Ira Duarte
|
| |
-
|
| |
800,000(3)
|
| |
-
|
| |
$1.21
|
| |
6/16/2023
|
| |
6/16/2033
|
| |
-
|
| |
-
|
| |
500,000(1)
|
| |
$1.21
|
| |
6/16/2023
|
| |
6/16/2033
|
|
William Forbes
|
| |
-
|
| |
500,000(3)
|
| |
-
|
| |
$1.11
|
| |
6/6/2023
|
| |
6/6/2033
|
| |
-
|
| |
-
|
| |
700,000(1)
|
| |
$1.11
|
| |
6/6/2023
|
| |
6/6/2033
|
|
Barry Quart, Pharm.D.
|
| |
-
|
| |
-
|
| |
-
|
| |
$-
|
| |
-
|
| |
-
|
David Szekeres
|
| |
24,688
|
| |
-
|
| |
-
|
| |
$16.20
|
| |
3/17/2016
|
| |
3/17/2026
|
| |
145,312
|
| |
-
|
| |
-
|
| |
$16.20
|
| |
3/17/2016
|
| |
3/17/2026
|
|
| |
2,083
|
| |
-
|
| |
-
|
| |
$16.83
|
| |
10/7/2016
|
| |
10/7/2026
|
|
| |
47,917
|
| |
-
|
| |
-
|
| |
$16.83
|
| |
10/7/2016
|
| |
10/7/2026
|
|
| |
4
|
| |
-
|
| |
-
|
| |
$13.00
|
| |
12/21/2016
|
| |
12/21/2026
|
|
| |
79,163
|
| |
-
|
| |
-
|
| |
$13.00
|
| |
12/21/2016
|
| |
12/21/2026
|
|
| |
5,882
|
| |
-
|
| |
-
|
| |
$17.00
|
| |
12/18/2017
|
| |
12/18/2027
|
|
| |
84,118
|
| |
-
|
| |
-
|
| |
$17.00
|
| |
12/18/2017
|
| |
12/18/2027
|
|
| |
4,004
|
| |
-
|
| |
-
|
| |
$24.97
|
| |
12/15/2018
|
| |
12/15/2028
|
|
| |
87,996
|
| |
-
|
| |
-
|
| |
$24.97
|
| |
12/15/2018
|
| |
12/15/2028
|
|
| |
3,996
|
| |
-
|
| |
-
|
| |
$25.02
|
| |
12/19/2019
|
| |
12/19/2029
|
|
| |
111,004
|
| |
-
|
| |
-
|
| |
$25.02
|
| |
12/19/2019
|
| |
12/19/2029
|
|
| |
6,363
|
| |
-
|
| |
-
|
| |
$15.72
|
| |
10/13/2020
|
| |
10/13/2030
|
|
| |
29,637
|
| |
-
|
| |
-
|
| |
$15.72
|
| |
10/13/2020
|
| |
10/13/2030
|
|
| |
120,000
|
| |
-
|
| |
-
|
| |
$15.72
|
| |
10/13/2020
|
| |
10/13/2030
|
|
| |
81,136
|
| |
-
|
| |
-
|
| |
$10.55
|
| |
10/13/2021
|
| |
10/13/2031
|
|
| |
3
|
| |
-
|
| |
-
|
| |
$3.17
|
| |
7/25/2022
|
| |
7/25/2032
|
|
| |
165,958
|
| |
-
|
| |
-
|
| |
$3.17
|
| |
7/25/2022
|
| |
7/25/2032
|
(1)
|
Options vest upon achievement of the Company's stock price reaching pre-established levels as specified in the grant agreement.
|
(2)
|
Options vest over a four-year period, with fifteen percent (15%) of the shares vesting upon the first anniversary of the grant and then vesting ratably on a monthly basis, with eighteen percent (18%) of the shares vesting during the second year, twenty-five percent (25%) of the shares vesting during the third year and forty-two percent (42%) vesting during the fourth year.
|
(3)
|
Options vest over a four-year period, with 25% of the shares vesting upon the first anniversary of the grant and then vesting ratably on a monthly basis, with twenty-five percent (25%) of the shares vesting during each of the second, third and fourth year.
|
| |
Stock Awards
|
|||||||
Name
|
| |
Number of Shares or
Units of Stock that
Have Not Vested
(#)
|
| |
Market Value of
Shares or Units of
Stock that Have
Not Vested
($)(1)
|
| |
Grant Date
|
Craig Collard
|
| |
250,000(2)
|
| |
$425,000
|
| |
4/3/2023
|
| |
30,777(3)
|
| |
$52,321
|
| |
2/22/2023
|
|
Ira Duarte
|
| |
50,000(2)
|
| |
$85,000
|
| |
6/16/2023
|
William Forbes
|
| |
50,000(2)
|
| |
$85,000
|
| |
6/6/2023
|
Barry Quart, Pharm.D.
|
| |
-
|
| |
$-
|
| |
-
|
David Szekeres
|
| |
-
|
| |
$-
|
| |
-
|
(1)
|
Market value of unvested shares is based on the closing price of our shares of common stock of $1.70 on December 29, 2023.
|
(2)
|
Restricted stock units vest in four equal installments annually on the anniversary of the grant date, over a four-year period.
|
(3)
|
Restricted stock units vest in sixteen equal installments quarterly on the anniversary of the grant date, over a four-year period.
|
Cash Compensation
|
|||
Annual Board Cash Retainer*
|
| |
$50,000
|
Annual Lead Independent Director Cash Retainer*
|
| |
$25,000
|
Annual Audit Committee Chair Cash Retainer*
|
| |
$20,000
|
Annual Audit Committee Member Cash Retainer*
|
| |
$10,000
|
Annual Compensation Committee Chair Cash Retainer*
|
| |
$15,000
|
Annual Compensation Committee Member Cash Retainer*
|
| |
$7,500
|
Annual Nominating & Corporate Governance Committee Chair Cash Retainer*
|
| |
$10,000
|
Annual Nominating & Corporate Governance Committee Member Cash Retainer*
|
| |
$5,000
|
*
|
paid in quarterly installments
|
Board Grants
|
| |
Shares
(#)
|
Initial Option Award(1)
|
| |
227,272
|
Initial Stock Award(2)
|
| |
37,879
|
Annual Option Award
|
| |
-
|
Annual Stock Award
|
| |
-
|
(1)
|
Options vest and become exercisable monthly over a four-year period from the date of grant.
|
(2)
|
Restricted stock units vest quarterly over a four-year period from the date of grant.
|
Directors(5)
|
| |
Fees Earned
or Paid
in Cash
|
| |
Option Awards(3)
|
| |
Stock Awards(3)
|
| |
Total
|
||||||
Craig Collard(1)
|
| |
$-
|
| |
$
|
| |
-
|
| |
$
|
| |
-
|
| |
$-
|
Sharmila Dissanaike, M.D., FACS, FCCM
|
| |
$55,000
|
| |
$
|
| |
-
|
| |
$
|
| |
-
|
| |
$55,000
|
Craig Johnson
|
| |
$79,028
|
| |
$
|
| |
-
|
| |
$
|
| |
-
|
| |
$79,028
|
Kevin Kotler(2)
|
| |
$62,014
|
| |
$
|
| |
78,716
|
| |
$
|
| |
19,175
|
| |
$159,905
|
Adam Morgan
|
| |
$65,417
|
| |
$
|
| |
377,840
|
| |
$
|
| |
102,273
|
| |
$545,530
|
Susan Rodriguez
|
| |
$65,625
|
| |
$
|
| |
-
|
| |
$
|
| |
-
|
| |
$65,625
|
Christian Waage
|
| |
$70,514
|
| |
$
|
| |
-
|
| |
$
|
| |
-
|
| |
$70,514
|
(1)
|
Mr. Collard received compensation for his services as a director, before being appointed as the Company's Chief Executive Officer on April 3, 2023. Information relating to the compensation paid to Craig Collard for services as a director is included in the Summary Compensation Table above.
|
(2)
|
Mr. Kotler resigned as a member of the Board effective December 21, 2023. During 2023, Mr. Kotler was granted option awards of 227,272, of which 179,924 was cancelled upon his resignation and stock awards of 37,789, of which 30,777 was cancelled upon his resignation.
|
(3)
|
These columns reflect the aggregate grant date fair value of equity awards granted in 2023 and calculated in accordance with FASB ASC 718. The assumptions used in our Annual Report on Form 10-K for the year ended December 31, 2023.
|
(4)
|
The Option Awards vest ratably on a monthly basis over forty-eight months and the Stock Awards vest ratably on a quarterly basis over sixteen quarters.
|
(5)
|
The aggregate number of shares subject to outstanding stock options held by each director listed in the table above as of December 31, 2023 was as follows: 7,250,000 shares for Mr. Collard, 16,406 shares for Dr. Dissanaike, zero shares for Mr. Johnson and Mr. Kotler, 179,924 shares for Mr. Morgan, 16,406 shares for Ms. Rodriguez and zero shares for Mr. Waage. In addition, the following shares subject to outstanding restricted stock units as of December 31, 2023 was as follows: 280,777 shares for Mr. Collard, 2,734 shares for Dr. Dissanaike, zero shares for Mr. Johnson and Mr. Kotler, 30,777 shares for Mr. Morgan, 2,734 shares for Ms. Rodriguez and zero shares for Mr. Waage.
|
Year
|
| |
Summary
Compensation
Table Total for
Current PEO
($)(1)
|
| |
Summary
Compensation
Table Total for
Former PEO
($)(1)
|
| |
Compensation
Actually Paid
to Current
PEO
($)(2)
|
| |
Compensation
Actually Paid to
Former PEO
($)(2)
|
| |
Average Summary
Compensation
Table Total for
Non-PEO NEOs
($)(3)
|
| |
Average
Compensation
Actually Paid to
Non-PEO NEOs
($)(4)
|
| |
Value of Initial Fixed
$100 Investment
Based On: Total
Shareholder Return(5)
|
| |
Net Loss
(millions)(6)
|
(a)
|
| |
(b)
|
| |
(b)
|
| |
(c)
|
| |
(c)
|
| |
(d)
|
| |
(e)
|
| |
(f)
|
| |
(g)
|
2023
|
| |
$10,775,818
|
| |
$4,030,347
|
| |
$10,089,399
|
| |
$673,388
|
| |
$1,623,453
|
| |
$1,179,569
|
| |
$8.03
|
| |
$(111)
|
2022
|
| |
-
|
| |
1,145,704
|
| |
-
|
| |
(2,798,657)
|
| |
1,438,169
|
| |
357,507
|
| |
11.81
|
| |
(182)
|
2021
|
| |
-
|
| |
5,430,828
|
| |
-
|
| |
(1,032,982)
|
| |
1,581,471
|
| |
(619,359)
|
| |
43.14
|
| |
(221)
|
(1)
|
The dollar amounts reported in column (b) are the amounts of total compensation reported for Craig Collard and Barry Quart (our former Chief Executive Officer) for each corresponding year in the "Total" column of the Summary Compensation Table. Refer to "Executive Compensation-Summary Compensation Table."
|
(2)
|
The dollar amounts reported in column (e) represent the amount of "compensation actually paid" to Craig Collard and Barry Quart, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to Craig Collard or Barry Quart during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to Craig Collard's and Barry Quart's total compensation for each year to determine the compensation actually paid:
|
Year
|
| |
Reported
Summary
Compensation
Table Total
for Current
PEO
($)
|
| |
Reported
Summary
Compensation
Table Total
for Former
PEO
($)
|
| |
Reported
Value of
Equity Awards
to Current PEO
($)
|
| |
Reported
Value of
Equity Awards
to Former PEO
($)
|
| |
Equity Award
Adjustments -
Current PEO
($)
|
| |
Equity Award
Adjustments -
Former PEO
($)
|
| |
Compensation
Actually Paid to
Current PEO
($)
|
| |
Compensation
Actually Paid
to Former PEO
($)
|
2023
|
| |
$10,775,818
|
| |
$4,030,347
|
| |
$(9,804,322)
|
| |
$(2,414,240)
|
| |
$9,117,903
|
| |
$(942,718)
|
| |
$10,089,399
|
| |
$673,388
|
•
|
The "Reported Value of Equity Awards" represents the grant date fair value of equity awards represents the total of the amounts reported in the "Stock Awards" and "Option Awards" columns in the Summary Compensation Table for 2023.
|
•
|
The equity award adjustments include the addition (or subtraction, as applicable) of the following: (i) the 2023 year-end fair value of any equity awards granted in 2023 that are outstanding and unvested as of the end of 2023; (ii) the amount of change as of the end of the 2023 (from the end of 2022) in fair value of any awards granted prior to 2023 that are outstanding and unvested as of the end of 2023; (iii) for awards that are granted and vest in 2023, the fair value as of the vesting date; (iv) for awards granted prior to 2023 that vest in 2023, the amount equal to the change as of the vesting date (from the end of 2022) in fair value; and (v) for awards granted prior to 2022 that are determined to fail to meet the applicable vesting conditions during 2022, a deduction for the amount equal to the fair value at the end of 2022. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. The amounts deducted or added in calculating the equity award adjustments are as follows:
|
Year
|
| |
Year End
Fair Value
of Equity
Awards
granted
in 20-3-
Current
PEO
($)
|
| |
Year Over
Year Change
in Fair Value
of Outstanding
and Unvested
Equity Awards
($)
|
| |
Fair Value
as of Vesting
Date of
Equity Awards
Granted
and Vested
in the Year
($)
|
| |
Year Over
Year Change
in Fair Value
of Equity Awards
Granted in Prior
Years that Vested
in the Year
($)
|
| |
Year Over
Year Change
in Fair Value
of Equity Awards
Granted in Prior
Years that Failed
to Meet Vesting
Conditions
|
| |
Total Equity
Award
Adjustments -
Current PEO
($)
|
2023
|
| |
$9,107,321
|
| |
$-
|
| |
$10,582
|
| |
$-
|
| |
$-
|
| |
$9,117,903
|
Year
|
| |
Year End Fair
Value of Equity
Awards granted
in 20-3 - Former
PEO ($)
|
| |
Year Over
Year Change in
Fair Value of
Outstanding
and Unvested
Equity Awards
($)
|
| |
Fair Value
as of Vesting
Date of
Equity
Awards
Granted and
Vested in the
Year
($)
|
| |
Year Over Year
Change in Fair Value
of Equity Awards
Granted in Prior Years
that Vested in the Year
($)
|
| |
Year Over
Year Change in
Fair Value of
Equity Awards
Granted in
Prior Years
that Failed to
Meet Vesting
Conditions
|
| |
Total Equity
Award Adjustments -
Former PEO
($)
|
2023
|
| |
$-
|
| |
$-
|
| |
$-
|
| |
$(549,550)
|
| |
$(393,168)
|
| |
$(942,718)
|
(3)
|
The dollar amounts reported in column (d) represent the average of the amounts reported for the NEOs as a group (excluding the PEO in each respective year) in the "Total" column of the Summary Compensation Table in each applicable year. The NEOs (excluding the PEO) included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2023, Ira Duarte, William Forbes, and David Szkeres; (ii) for 2022, Kimberly Manhard, and David Szekeres , and (iii) for 2021, Kimberly Manhard, John Poyhonen, David Szekeres and Lisa Peraza.
|
(4)
|
The dollar amounts reported in column (e) represent the average amount of "compensation actually paid" to the NEOs as a group (excluding the PEO), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group (excluding the PEO) during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for the NEOs as a group (excluding the PEO) for 2023 to determine the compensation actually paid, using the same methodology described above:
|
Year
|
| |
Average Reported
Summary
Compensation
Table Total for
Non-PEO NEOs
($)
|
| |
Average Reported
Value of Equity
Awards - NEOs
($)
|
| |
Average Equity
Award
Adjustments -
NEOs
($)
|
| |
Average
Compensation
Actually Paid to
Non-PEO NEOs
($)
|
2023
|
| |
$1,623,453
|
| |
$(500,246)
|
| |
$56,362
|
| |
$1,179,569
|
•
|
The amounts deducted or added in calculating the total average equity award adjustments are as follows:
|
Year
|
| |
Average
Year End
Fair Value
of Equity
Awards
granted in
2023
($)
|
| |
Year Over
Year Average
Change in Fair
Value of
Outstanding
and Unvested
Equity Awards
($)
|
| |
Average
Fair Value
as of Vesting
Date of Equity
Awards Granted
and Vested
in the Year
($)
|
| |
Year Over
Year Average
Change in Fair
Value of Equity
Awards Granted in
Prior Years that
Vested in the Year
($)
|
| |
Year Over
Year Average
Change in Fair
Value of Equity
Awards Granted in
Prior Years that
Failed to Meet
Vesting Conditions
|
| |
Total Average
Equity Award
Adjustments -
NEOs
($)
|
2023
|
| |
$575,333
|
| |
$-
|
| |
$-
|
| |
($360,313)
|
| |
($158,659)
|
| |
$56,362
|
(5)
|
Cumulative Total Shareholder Return ("TSR") is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the Company's share price at the end and the beginning of the measurement period by the Company's share price at the beginning of the measurement period.
|
(6)
|
The dollar amounts reported in column (g) represent the amount of net income (loss) reflected in the Company's audited financial statements for the applicable year.
|
| |
2023
|
| |
2022
|
|
Audit fees(1)
|
| |
$540,660
|
| |
$406,952
|
Audit-related fees(2)
|
| |
24,960
|
| |
22,880
|
Tax fees(3)
|
| |
102,903
|
| |
98,826
|
All other fees
|
| |
-
|
| |
-
|
Total
|
| |
$668,523
|
| |
$528,658
|
(1)
|
The audit fees for both 2023 and 2022 were for professional services rendered in connection with the audit of our annual financial statements and internal control over financial reporting and for the review of the quarterly financial statements. The amounts also include fees for services that are normally provided by the auditor in connection with regulatory filings and engagements for the years identified.
|
(2)
|
The audit-related fees for both 2023 and 2022 include fees for procedures performed during that year in connection with the audit of the Heron Therapeutics, Inc. 401(k) Plan.
|
(3)
|
Tax fees for both 2023 and 2022 consist of fees for tax compliance.
|
| |
Number of
Shares
|
| |
As a percentage of
common stock
outstanding as of
March 31, 2024
(150,362,664 shares)
|
|
Total shares of common stock subject to outstanding awards as of March 31, 2024 under the 2007 Plan
|
| |
27,367,439
|
| |
18.2%
|
Total shares of common stock available for future grant as of March 31, 2024 under the 2007 Plan
|
| |
3,759,818
|
| |
2.5%
|
Total shares of common stock subject to outstanding awards as of March 31, 2024 not under the 2007 Plan
|
| |
4,010,000
|
| |
2.7%
|
Proposed additional shares of common stock available for future grant under the 2007 plan
|
| |
7,500,000
|
| |
5.0%
|
| |
Equity Awards
Granted
|
| |
Weighted Average
Number of Shares of
Common Stock
Outstanding
|
| |
Burn Rate
|
|
2023
|
| |
14,407,885(1)
|
| |
138,135,000
|
| |
10.4%
|
2022
|
| |
7,128,055(2)
|
| |
108,875,738
|
| |
6.5%
|
2021
|
| |
4,502,937(3)
|
| |
98,471,488
|
| |
4.6%
|
(1)
|
Includes 1,757,506 shares subject to restricted stock units.
|
(2)
|
Includes 1,831,508 shares subject to restricted stock units/performance stock units.
|
(3)
|
Includes 2,448,957 shares subject to restricted stock units.
|
Name
|
| |
Position
|
| |
Number of Shares
Underlying Awards
|
Craig Collard
|
| |
Chief Executive Officer
|
| |
9,310,413
|
William Forbes
|
| |
Chief Development Officer
|
| |
483,924
|
Ira Duarte
|
| |
Chief Financial Officer
|
| |
483,924
|
Barry Quart, Pharm.D
|
| |
Former Chief Executive Officer
|
| |
4,214,902
|
David Szekeres
|
| |
Former Executive Vice President, Chief Operating Officer
|
| |
1,407,609
|
| | | | |||
All current executive officers as a group
|
| |
10,278,251
|
|||
All current directors who are not executive officers as a group
|
| |
1,772,971
|
|||
Each nominee for election as a director
|
| | ||||
Christian Waage
|
| |
361,003
|
|||
Craig Johnson
|
| |
472,228
|
|||
Sharmila Dissanaike, M.D.
|
| |
288,478
|
|||
Susan Rodriguez
|
| |
288,478
|
|||
Adam Morgan
|
| |
362,784
|
|||
Each associate of any such directors, executive officers or nominees
|
| |
-
|
|||
Each other person who received or is to receive 5% of such options, warrants or rights
|
| |
-
|
|||
All current employees, including all officers who are not executive officers, as a group
|
| |
12,396,445
|
Plan Category
|
| |
Number of
Securities to
be Issued
upon
Exercise
of
Outstanding
Options or
Vesting of
Outstanding
Restricted Stock
Units
(a)
|
| |
Weighted-
Average
Exercise
Price of
Outstanding
Options
(b)
|
| |
Number of
Securities
Remaining
Available for
Future
Issuance under
Equity-Based
Compensation
Plans
(Excluding
Securities
Reflected in
Column (a))
(c)
|
Equity-based compensation plans approved by security holders:
|
| | | | | | |||
Stock option and award plans(1)
|
| |
22,669,791
|
| |
$7.71
|
| |
8,605,026
|
Employee stock purchase plan(2)
|
| |
-
|
| |
-
|
| |
327,555
|
Equity-based compensation plans not approved by security holders(3)
|
| |
3,310,000
|
| |
$1.25
|
| |
136,666
|
Total
|
| |
25,979,791
|
| |
$6.89
|
| |
9,069,247
|
(1)
|
Includes the Amended and Restated 2007 Equity Incentive Plan. See a description of this plan under Note 10 to the Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023.
|
(2)
|
Includes the 1997 Employee Stock Purchase Plan. See a description of this plan under Note 10 to the Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023.
|
(3)
|
Non-qualified options issued outside of the stockholder approved equity plans are governed in all respects by terms as if granted under the Amended and Restated 2007 Equity Incentive Plan. See description of the stock option plans under Note 10 to the Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023.
|
Name and Position
|
| |
Number of
Shares
|
Craig Collard, Chief Executive Officer
|
| |
-
|
William Forbes, Chief Development Officer
|
| |
-
|
Ira Duarte, Chief Financial Officer
|
| |
-
|
Barry Quart, Pharm.D, Former Chief Executive Officer
|
| |
15,602
|
David Szekeres, Former Executive Vice President, Chief Operating Officer
|
| |
11,063
|
All current executive officers as a group
|
| |
26,665
|
Each associate of any directors, executive officers or nominees
|
| |
-
|
Each other person who received or is to receive 5% of such options, warrants or rights
|
| |
-
|
All current employees, including all current officers who are not executive officers, as a group
|
| |
838,435
|
Plan Category
|
| |
Number of
Securities to
be Issued
upon
Exercise
of
Outstanding
Options or
Vesting of
Outstanding
Restricted Stock
Units
(a)
|
| |
Weighted-
Average
Exercise
Price of
Outstanding
Options
(b)
|
| |
Number of
Securities
Remaining
Available for
Future
Issuance under
Equity-Based
Compensation
Plans
(Excluding
Securities
Reflected in
Column (a))
(c)
|
Equity-based compensation plans approved by security holders:
|
| | | | | | |||
Stock option and award plans(1)
|
| |
22,669,791
|
| |
$ 7.71
|
| |
8,605,026
|
Employee stock purchase plan(2)
|
| |
-
|
| |
-
|
| |
327,555
|
Equity-based compensation plans not approved by security holders(3)
|
| |
3,310,000
|
| |
$ 1.25
|
| |
136,666
|
Total
|
| |
25,979,791
|
| |
$ 6.89
|
| |
9,069,247
|
(1)
|
Includes the Amended and Restated 2007 Equity Incentive Plan. See a description of this plan under Note 10 to the Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023.
|
(2)
|
Includes the 1997 Employee Stock Purchase Plan. See a description of this plan under Note 10 to the Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023.
|
(3)
|
Non-qualified options issued outside of the stockholder approved equity plans are governed in all respects by terms as if granted under the Amended and Restated 2007 Equity Incentive Plan. See description of the stock option plans under Note 10 to the Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023.
|
| |
HERON THERAPEUTICS, INC.
|
||||
| | | | |||
| |
By:
|
| | ||
| |
Name:
|
| |
Craig Collard
|
|
| |
Title:
|
| |
Chief Executive Officer
|