def14a
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN
PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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Soliciting Material Pursuant to §240.14a-12 |
ANTHERA 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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25801 Industrial Boulevard, Suite B
Hayward, California 94545
NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS
April 19, 2011
The Annual Meeting of Stockholders of Anthera Pharmaceuticals,
Inc. will be held on Tuesday, April 19, 2011 at
11:00 a.m. local time, at the offices of Goodwin
Procter LLP, 135 Commonwealth Drive, Menlo Park, California,
94025, for the following purposes:
1. To elect two Class II directors, as nominated by
the Board of Directors, to hold office until the
2014 Annual Meeting of Stockholders or until their
successors are duly elected and qualified;
2. To ratify the appointment of Deloitte & Touche
LLP as the independent registered public accounting firm of the
Company for its fiscal year ending December 31,
2011; and
3. To transact such other business as may properly come
before the meeting or any adjournment or postponement thereof.
Proposal 1 relates solely to the election of two
Class II directors nominated by the Board of Directors and
does not include any other matters relating to the election of
directors, including without limitation, the election of
directors nominated by any stockholder of the Company.
The Board of Directors has fixed the close of business on
March 9, 2011 as the record date for the determination of
stockholders entitled to notice of, and to vote at, the Annual
Meeting of Stockholders, or at any adjournments of the Annual
Meeting of Stockholders.
In order to ensure your representation at the Annual Meeting of
Stockholders, you are requested to submit your proxy over the
Internet, by telephone or by signing and dating the enclosed
proxy as promptly as possible and returning it in the enclosed
envelope (to which no postage need be affixed if mailed in the
United States). If you attend the Annual Meeting of Stockholders
and file with the Secretary of the Company an instrument
revoking your proxy or a duly executed proxy bearing a later
date, your proxy will not be used.
All stockholders are cordially invited to attend the Annual
Meeting of Stockholders.
By Order of the Board of Directors
Anthera Pharmaceuticals, Inc.
Bradley A. Bugdanowitz
Secretary
Hayward, California
March 16, 2011
Your vote is important, whether or not you expect to attend
the Annual Meeting of Stockholders. You are urged to vote either
via the Internet or telephone, or to mark, sign and date and
promptly return the proxy in the stamped return envelope
provided with such materials. Voting promptly will help avoid
the additional expense of further solicitation to assure a
quorum at the meeting.
TABLE OF
CONTENTS
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ANTHERA
PHARMACEUTICALS, INC.
APRIL 19, 2011
INFORMATION
CONCERNING SOLICITATION AND VOTING
General
This proxy statement is furnished in connection with the
solicitation of proxies for use prior to or at the Annual
Meeting of Stockholders (the Annual Meeting) of
Anthera Pharmaceuticals, Inc. (the Company), a
Delaware corporation, to be held at 11:00 a.m. local time
on Tuesday, April 19, 2011 and at any adjournments or
postponements thereof for the following purposes:
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To elect two Class II directors, as nominated by the Board
of Directors, to hold office until the 2014 Annual Meeting of
Stockholders or until their successors are duly elected and
qualified;
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To ratify the appointment of Deloitte & Touche LLP as
the independent registered public accounting firm of the Company
for its fiscal year ending December 31, 2011; and
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To transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.
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The Annual Meeting will be held at the offices of Goodwin
Procter LLP, 135 Commonwealth Drive, Menlo Park, California
94025. The proxy statement and accompanying form of proxy will
be mailed to stockholders on or about March 16, 2011.
Important Notice Regarding the Availability of Proxy
Materials for the Stockholder Meeting to be Held on
April 19, 2011
This proxy statement and the Companys 2010 Annual
Report are available electronically at www.proxyvote.com.
Solicitation
This solicitation is made on behalf of the Board of Directors.
We will bear the costs of preparing, mailing, online processing
and other costs of the proxy solicitation made by our Board of
Directors. Certain of our officers and employees may solicit the
submission of proxies authorizing the voting of shares in
accordance with the Board of Directors recommendations.
Such solicitations may be made by telephone, facsimile
transmission or personal solicitation. No additional
compensation will be paid to such officers, directors or regular
employees for such services. We will reimburse banks, brokerage
firms and other custodians, nominees and fiduciaries for
reasonable
out-of-pocket
expenses incurred by them in sending proxy material to
stockholders.
Voting
Rights and Outstanding Shares
Only holders of record of our common stock as of the close of
business on March 9, 2011 are entitled to receive notice
of, and to vote at, the Annual Meeting. Each holder of common
stock shall be entitled to one vote for each share held on all
matters to be voted upon at the Annual Meeting. At the close of
business on March 9, 2011, there were
32,906,412 shares of common stock issued and outstanding.
A quorum of stockholders is necessary to take action at the
Annual Meeting. Stockholders representing a majority of the
outstanding shares of our common stock (present in person or
represented by proxy) will constitute a quorum. We will appoint
election inspectors for the meeting to determine whether or not
a quorum is present and to tabulate votes cast by proxy or in
person at the Annual Meeting. Abstentions, withheld votes and
broker non-votes (which occur when a broker, bank or other
nominee holding shares for a beneficial owner does not vote on a
particular matter because such broker, bank or other nominee
does not have discretionary authority to vote on that matter and
has not received voting instructions from the beneficial owner)
are counted as present for purposes of determining the presence
of a quorum for the transaction of business at the Annual
Meeting.
Votes
Required for Each Proposal
To elect our directors and approve the other proposals being
considered at the Annual Meeting, the voting requirements are as
follows:
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Vote
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Discretionary
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Proposal
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Required
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Voting Permitted?
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Election of Directors
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Plurality
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No
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Ratification of Deloitte & Touche LLP
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Majority
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Yes
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Discretionary Voting Permitted means that
brokers will have discretionary voting authority with respect to
shares held in street name for their clients, even if the broker
does not receive voting instructions from their client.
Majority means a majority of the votes
properly cast for and against such matter.
Plurality means a plurality of the votes
properly cast on the election of directors.
The vote required and method of calculation for the proposals to
be considered at the Annual Meeting are as follows:
Proposal One Election of
Directors. If a quorum is present, the two
director nominees receiving the highest number of votes, in
person or by proxy, will be elected as directors. You may vote
FOR both nominees, WITHHOLD for both
nominees or WITHHOLD for any nominee by specifying
the name of such nominee on your proxy card. Withheld votes and
broker non-votes will have no effect on the outcome of the
election of directors.
All Other Proposals Approval of the Ratification
of Deloitte & Touche LLP as independent registered
public accountants. Approval of all proposals
(other than the election of directors) requires the affirmative
vote of a majority of the votes properly cast for and against
such matter. You may vote FOR, AGAINST
or ABSTAIN from voting on these proposals. If you
abstain from voting on any of these matters, your shares will
not be counted as votes cast with respect to such
matter, and the abstention will have no effect on the proposal.
Broker non-votes will not be counted as votes cast
and will therefore have no effect on the proposals.
We request that you vote your shares by proxy following the
methods as instructed by the notice: over the Internet, by
telephone or by mail. If you choose to vote by mail, your shares
will be voted in accordance with your voting instructions if the
proxy card is received prior to or at the meeting. If you sign
and return your proxy card but do not give voting instructions,
your shares will be voted FOR (1) the election of the
Companys nominees as directors; (2) the ratification
of the appointment of Deloitte & Touche LLP as the
independent registered public accounting firm for the Company
for the fiscal year ending December 31, 2011; and
(3) as the proxy holders deem advisable, in their
discretion, on other matters that may properly come before the
Annual Meeting.
Voting by
Proxy Over the Internet or by Telephone
Stockholders whose shares are registered in their own names may
vote by proxy by mail, over the Internet or by telephone.
Instructions for voting by proxy over the Internet or by
telephone are set forth on the notice of proxy materials. The
Internet and telephone voting facilities will close at
11:59 p.m. Eastern Time on Monday, April 18, 2011. The
notice will also provide instructions on how you can elect to
receive future proxy materials electronically or in printed form
by mail. If you choose to receive future proxy materials
electronically, you will receive an email next year with
instructions containing a link to the proxy materials and a link
to the proxy voting site. Your election to receive proxy
materials electronically or in printed form by mail will remain
in effect until you terminate such election.
If your shares are held in street name, the voting instruction
form sent to you by your broker, bank or other nominee should
indicate whether the institution has a process for beneficial
holders to provide voting instructions
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over the Internet or by telephone. A number of banks and
brokerage firms participate in a program that also permits
stockholders whose shares are held in street name to direct
their vote over the Internet or by telephone. If your bank or
brokerage firm gives you this opportunity, the voting
instructions from the bank or brokerage firm that accompany this
proxy statement will tell you how to use the Internet or
telephone to direct the vote of shares held in your account. If
your voting instruction form does not include Internet or
telephone information, please complete and return the voting
instruction form in the self-addressed, postage-paid envelope
provided by your broker. Stockholders who vote by proxy over the
Internet or by telephone need not return a proxy card or voting
instruction form by mail, but may incur costs, such as usage
charges, from telephone companies or Internet service providers.
Revocability
of Proxies
Any proxy may be revoked at any time before it is exercised by
filing an instrument revoking it with the Companys
Secretary or by submitting a duly executed proxy bearing a later
date prior to the time of the Annual Meeting. Stockholders who
have voted by proxy over the Internet or by telephone or have
executed and returned a proxy and who then attend the Annual
Meeting and desire to vote in person are requested to notify the
Secretary in writing prior to the time of the Annual Meeting. We
request that all such written notices of revocation to the
Company be addressed to Bradley A. Bugdanowitz, Secretary,
c/o Anthera
Pharmaceuticals, Inc., at the address of our principal executive
offices at 25801 Industrial Boulevard, Suite B, Hayward,
California 94545. Our telephone number is
(510) 856-5600.
Stockholders may also revoke their proxy by entering a new vote
over the Internet or by telephone.
Stockholder
Proposals to be Presented at the Next Annual Meeting
Any stockholder who meets the requirements of the proxy rules
under the Securities Exchange Act of 1934, as amended (the
Exchange Act), may submit proposals to the Board of
Directors to be presented at the 2012 annual meeting. Such
proposals must comply with the requirements of
Rule 14a-8
under the Exchange Act and be submitted in writing by notice
delivered or mailed by first-class United States mail,
postage prepaid, to our Secretary at our principal executive
offices at the address set forth above no later than
November 17, 2011 in order to be considered for inclusion
in the proxy materials to be disseminated by the Board of
Directors for such annual meeting.
Our Amended and Restated Bylaws also provide for separate notice
procedures to recommend a person for nomination as a director or
to propose business to be considered by stockholders at a
meeting. To be considered timely under these provisions, the
stockholders notice must be received by our Secretary at
our principal executive offices at the address set forth above
no earlier than December 21, 2011 and no later than
January 20, 2012. Our Amended and Restated Bylaws also
specify requirements as to the form and content of a
stockholders notice.
The Board of Directors, a designated committee thereof or the
chairman of the meeting may refuse to acknowledge the
introduction of any stockholder proposal if it is not made in
compliance with the applicable notice provisions.
PROPOSAL 1
ELECTION
OF DIRECTORS
General
Our certificate of incorporation provides for a Board of
Directors that is divided into three classes. The term for each
class is three years, staggered over time. This year, the term
of the directors in Class II expires. Two of our
Class II directors will stand for re-election at the Annual
Meeting. One of our Class II directors, Annette Bianchi,
will not stand for re-election. Our Board of Directors is
currently comprised of eight members. If both of the nominees
are elected at the Annual Meeting of Stockholders, the
composition of our Board will be as follows:
Class I Messrs. Santel and Thompson;
Class II Drs. Healy and Thompson; and
Class III Dr. Henney and
Messrs. Spiegelman and Truex.
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In the absence of instructions to the contrary, the persons
named as proxy holders in the accompanying proxy intend to vote
in favor of the election of the two nominees designated below to
serve until the 2014 Annual Meeting of Stockholders and until
their respective successors shall have been duly elected and
qualified. Both of the nominees are currently directors. The
Board of Directors expects that each of the nominees will be
available to serve as a director, but if any such nominee should
become unavailable or unwilling to stand for election, it is
intended that the shares represented by the proxy will be voted
for such substitute nominee as may be designated by the Board of
Directors. The biographies of our directors and their ages as of
March 1, 2011 are set forth below.
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Name
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Age
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Position
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Paul F. Truex
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Chief Executive Officer, President and Director
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Christopher S. Henney, Ph.D.
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Chairman of the Board of Directors
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Annette Bianchi
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Director
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James I. Healy, M.D., Ph.D.
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Director
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Donald J. Santel
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Director
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Daniel K. Spiegelman
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Director
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David E. Thompson
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Director
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Peter A. Thompson, M.D.
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Director
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Nominees
for Director
Class II:
Each of the persons listed below is nominated for election to
Class II of the Board of Directors to serve a three-year
term ending at the 2014 annual meeting of stockholders and until
his successor is elected and qualified. The Board of
Directors recommends that you vote FOR each of the following
nominees.
James I.
Healy, M.D., Ph.D. Dr. Healy has
served as a member of our Board of Directors since August 2006.
Dr. Healy is a Managing Partner of Sofinnova Management VI,
LLC, the general partner of Sofinnova Venture Partners VI, L.P.,
a fund managed by Sofinnova Ventures, Inc., a venture capital
firm, a position he has held since June 2000. Prior to
Sofinnova, Dr. Healy began his private equity career at
Sanderling Ventures, and has been an early investor and board
member of numerous biopharmaceutical companies. Dr. Healy
holds a B.A. in molecular biology and a B.A. in Scandinavian
studies from the University of California at Berkeley, an M.D.
from Stanford University School of Medicine and a Ph.D. in
immunology from Stanford University. Dr. Healy is a
director of InterMune, Inc. and Amarin Corporation plc, both
biopharmaceutical companies.
Based on Dr. Healys extensive experience as a
director of numerous biopharmaceutical companies and his medical
training, the Board of Directors has determined that
Dr. Healy possesses the necessary attributes to serve on
our Board.
Peter A. Thompson, M.D. Dr. Thompson
has served as a member of our Board of Directors since February
2011. Dr. Thompson is currently a Venture Partner with
OrbiMed Advisors, LLC and has over 20 years of industry
experience. He co-founded Trubion Pharmaceuticals, and served as
CEO and Chairman from its inception through its IPO on NASDAQ
and as a public company until his retirement in 2009.
Dr. Thompson is the former Vice President and General
Manager of Chiron Informatics at Chiron Corporation and held
various executive positions at Becton Dickinson, including Vice
President, Research and Technology Department of BD Bioscience.
Dr. Thompson is a co-founder of iMetrikus, a clinical
decision support company, where he served as CEO and Chairman.
He is the founder and Managing Director of Strategicon Partners,
an investment and management services company. Dr. Thompson
is an Ernst & Young Entrepreneur of the Year awardee,
an inventor on numerous patents, a board-certified internist and
oncologist, and was on staff at the National Cancer Institute
following his internal medicine training at Yale University.
Dr. Thompson served on the Board of Directors of Trubion
Pharmaceuticals from 2006 through 2009 and currently serves on
the Board of Directors for Response Biomedical and CoDa
Therapuetics.
Based on Dr. Thompsons extensive industry experience,
the Board of Directors has determined that Dr. Thompson
would be a valuable member of our Board.
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Continuing
Directors
Class I:
Currently Serving Until the 2013 Annual Meeting
Donald J. Santel. Mr. Santel has served
as a member of our Board of Directors since October 2007. From
February 2000 until January 2007, Mr. Santel held various
positions in and was a member of the board of directors of
CoTherix, Inc., a pharmaceutical company he co-founded. From
October 2003 to August 2004, Mr. Santel served as President
and Chief Operating Officer of CoTherix and from August 2004
until January 2007, Mr. Santel served as Chief Executive
Officer. From June 2008 through June 2009, Mr. Santel
served as a consultant and from June 2009 until the present,
Mr. Santel has served as the Chief Executive Officer of
Hyperion Therapeutics, Inc., a pharmaceutical company.
Mr. Santel holds a B.S.E. in biomedical engineering from
Purdue University and an M.S. in electrical engineering
from the University of Minnesota.
Based on Mr. Santels executive experience and service
on other boards of directors in the biotechnology and
pharmaceutical industries, the Board of Directors believes
Mr. Santel has the appropriate set of skills to serve as a
member of our Board.
David E. Thompson. Mr. Thompson has
served as a member of our Board of Directors since November
2005. Mr. Thompson served as Vice President of Corporate
Strategy Business Development for Eli Lilly and Company from
January 2001 until his retirement in July 2005. Thereafter, he
was a partner at VantagePoint Venture Partners from 2006 through
2008. Mr. Thompson holds a B.S. and an M.B.A. from Michigan
State University.
The Board of Directors believes Mr. Thompson is suited to
serve on our Board due to his substantial investing experience
and prior experience working in the pharmaceutical industry.
Class III:
Currently Serving Until the 2012 Annual Meeting
Paul F. Truex. Mr. Truex has served as
our President and Chief Executive Officer since our inception in
September 2004 and as a member of our Board of Directors since
November 2004. Prior to founding Anthera, Mr. Truex served
as a Director, President and Chief Executive Officer of
Peninsula Pharmaceuticals, Inc., a biopharmaceutical company,
from the commencement of its operations in October 2001. Prior
to Peninsula, Mr. Truex was Vice President of Commercial
Development for Vicuron, Inc. from April 2000 to September 2001.
From July 1997 to April 2000, Mr. Truex held various
positions at Eli Lilly and Company. Mr. Truex holds an
M.B.A. in marketing and finance from Indiana University and a
B.A. in economics from the University of Waterloo.
Mr. Truex is a director of Trius Therapeutics, Inc.
The Board of Directors has concluded that Mr. Truex should
serve on our Board based on his deep knowledge of our Company
gained from his positions as President and Chief Executive
Officer, as well as his substantial experience in the
pharmaceutical industry.
Christopher S.
Henney, Ph.D. Dr. Henney has served as
the Chairman of our Board of Directors since August 2008 and has
been a member of our Board of Directors since April 2005.
Dr. Henney served as Chairman and Chief Executive Officer
of Dendreon Corporation, a biotechnology company he co-founded,
from 1995 until his retirement in July 2004. Dr. Henney was
previously a founder of Immunex Corp. and Icos Corp.
Dr. Henney holds a B.Sc. with honors in medical
biochemistry, a Ph.D. in experimental pathology and a D.Sc. for
contributions to the field of immunology, all from the
University of Birmingham, England. Dr. Henney served as a
director of AVI BioPharma Inc. from March 2009 until June
2010 and is currently the Chairman and a director of
Oncothyreon, Inc. and is vice-chairman and a director of
Cyclacel Pharmaceuticals, Inc.
The Board of Directors has determined that Dr. Henney is a
valuable addition to our Board based upon his long history with
the Company and his extensive experience in the biotechnology
industry.
Daniel K. Spiegelman. Mr. Spiegelman has
served as a member of our Board of Directors since February
2010. Currently, Mr. Spiegelman provides management and
financial consulting services to biotechnology companies. From
January 1998 to May 2009, Mr. Spiegelman served as Senior
Vice President and Chief Financial Officer of CV Therapeutics,
Inc., a biopharmaceutical company that was acquired by Gilead
Sciences, Inc. in April 2009. From July 1991 to January
1998, Mr. Spiegelman served at Genentech, Inc., most
recently as Treasurer. Mr. Spiegelman also serves on the
board of directors of Affymax, Inc., Cyclacel Pharmaceuticals,
Inc., Omeros
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Corporation and Oncothyreon, Inc., all of which are
publicly-traded biopharmaceutical companies. Mr. Spiegelman
also previously served on the board of directors of Xcyte
Therapies, Inc. from 2003 through 2006, a publicly-traded
company, until Cyclacel acquired Xcyte via reverse merger in
2006. Mr. Spiegelman holds a B.A. in economics from
Stanford University and an M.B.A. from the Stanford Graduate
School of Business.
Due to Mr. Spiegelmans experience in serving as a
director of multiple publicly-traded biopharmaceutical
companies, as well as his prior employment at various
pharmaceutical companies, our Board of Directors has concluded
that Mr. Spiegelman possesses the necessary attributes to
serve on our Board.
There are no family relationships between any of our directors
or executive officers.
Board of
Directors Role in Risk Management
The Board of Directors has overall responsibility for the
oversight of the Companys risk management process, which
is designed to support the achievement of organizational
objectives, including strategic objectives, to improve long-term
organizational performance and enhance shareholder value. Risk
management includes not only understanding company specific
risks and the steps management implements to manage those risks,
but also what level of risk is acceptable and appropriate for
the Company. Management is responsible for establishing our
business strategy, identifying and assessing the related risks
and implementing appropriate risk management practices. The
Board of Directors reviews our business strategy and
managements assessment of the related risk, and discusses
with management the appropriate level of risk for the Company.
For example, the Board of Directors meets with management at
least quarterly to review, advise and direct management with
respect to strategic business risks, litigation risks and risks
related to the Companys acquisition strategy, among
others. The Board also delegates oversight to Board committees
to oversee selected elements of risk as set forth below.
The Board of Directors has delegated
day-to-day
responsibility for administering and interpreting the
Companys Code of Business Conduct and Ethics to the
Companys Chief Financial Officer as compliance officer.
As part of its oversight of the Companys financial
reporting process and audits of the Companys financial
statements, our Audit Committee is responsible for reviewing
financial risk exposures, including monitoring the quality and
integrity of the Companys financial statements, the
effectiveness of internal controls over financial reporting,
compliance with legal or regulatory requirements, the
performance of the internal audit function and the performance
and independence of the Companys independent registered
public accounting firm, among other responsibilities as set
forth in the Audit Committee Charter. The Audit Committee
receives periodic internal controls and related assessments from
the Companys finance department and an annual attestation
report on internal control over financial reporting from the
Companys independent registered public accounting firm. In
addition, our Audit Committee ensures that the Companys
business is conducted with the highest standards of ethical
conduct in compliance with applicable laws and regulations by
monitoring our Code of Business Conduct and Ethics Policy and
our Employee Feedback Hotline, and the Audit Committee discusses
other risk assessment and risk management policies of the
Company periodically with management.
Our Compensation Committee participates in the design of
compensation structures that create incentives that encourage a
level of risk-taking behavior consistent with the Companys
business strategy.
Our Nominating and Corporate Governance Committee oversees
governance-related risks by developing and recommending to the
Board working with management to establish corporate governance
guidelines applicable to the Company, making recommendations
regarding director nominees and membership on Board committees
and overseeing the annual evaluation of the Board and management.
Board of
Directors and Committees of the Board
During 2010, the Board of Directors held a total of 11 meetings.
All directors attended at least 75% of the total number of Board
meetings and meetings of Board committees on which the director
served during the time he or she served on the Board or such
committees.
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The Board of Directors has determined each of the following
current and former directors is an independent
director as such term is defined in NASDAQ Marketplace
Rule 5605(a)(2) and Section 10A of the Exchange Act:
Messrs. Santel, Spiegelman and Thompson, Ms. Bianchi
and Drs. Henney, Healy, Rachel A. Leheny and Thompson.
The Board of Directors has a standing Audit Committee,
Compensation Committee, and Nominating and Corporate Governance
Committee. Each of our Audit Committee, Compensation Committee
and Nominating and Corporate Governance Committee is composed
entirely of independent directors in accordance with current
Nasdaq listing standards. Furthermore, our Audit Committee meets
the enhanced independence standards established by the
Sarbanes-Oxley Act of 2002 and related rulemaking of the
Securities and Exchange Commission (the SEC). The Board of
Directors has further determined that Daniel K. Spiegelman, a
member of the Audit Committee of the Board of Directors, is an
Audit Committee Financial Expert, as such term is
defined in Item 407(d)(5) of
Regulation S-K
promulgated by the SEC. Copies of our Audit Committee,
Nominating and Corporate Governance Committee and Compensation
Committee charters and our corporate governance guidelines are
available, free of charge, on our website at
http://www.anthera.com.
Audit Committee. The Audit Committee appoints,
approves the compensation of, and assesses the independence of
our independent registered public accounting firm and
pre-approves auditing and permissible non-audit services, and
the terms of such services, to be provided by our independent
registered public accounting firm. The Audit Committee is also
responsible for reviewing and discussing with management and the
independent registered public accounting firm our annual and
quarterly financial statements and related disclosures and
preparing the report required by the rules of the SEC to be
included in our annual proxy statement. The Audit Committee also
coordinates the oversight and reviews the adequacy of our
internal controls over financial reporting and establishes
policies and procedures for the receipt and retention of
accounting-related complaints and concerns. Currently, the Audit
Committee is comprised of Mr. Spiegelman (Chair),
Mr. Santel and Dr. Thompson. During 2010, the Audit
Committee held five meetings.
Compensation Committee. The Compensation
Committee annually reviews and approves our goals and objectives
relevant to compensation of our Chief Executive Officer,
evaluates our Chief Executive Officer in light of such goals and
determines the compensation of our Chief Executive Officer. The
Compensation Committee also reviews and approves the
compensation of all of our other officers, oversees and
administers our incentive-based compensation and equity plans
and reviews and makes recommendations to our Board of Directors
with respect to director compensation. The Compensation
Committee also produces an annual report on executive
compensation for inclusion in our proxy statement. Currently,
the Compensation Committee is comprised of Mr. Thompson
(Chair) and Mr. Santel and Dr. Thompson. During 2010,
the Compensation Committee held three meetings.
Nominating and Corporate Governance
Committee. The Nominating and Corporate
Governance Committee is responsible for developing and
recommending to our Board of Directors individuals to be
nominated as directors and committee members. This includes
establishing procedures for identifying and evaluating director
candidates (including nominees recommended by stockholders). The
Nominating and Corporate Governance Committee is also
responsible for developing and recommending to our Board of
Directors corporate governance guidelines, as well as overseeing
the evaluation of our Board of Directors, committees of the
Board and management. Currently, the Nominating and Corporate
Governance Committee is comprised of Dr. Henney (Chair),
Ms. Bianchi, and Mr. Thompson. During 2010, the
Nominating and Corporate Governance Committee held one meeting.
Board
Leadership
The positions of Chairman of the Board and Chief Executive
Officer are presently separated and have historically been
separated at Anthera. Separating these positions allows our
Chief Executive Officer to focus on our
day-to-day
business, while allowing the Chairman of the Board to lead the
Board of Directors in its fundamental role of providing advice
to and independent oversight of management. Our Board of
Directors recognizes the time, effort, and energy that the Chief
Executive Officer is required to devote to his position in the
current business environment, as well as the commitment required
to serve as our Chairman, particularly as the Board of
Directors oversight responsibilities continue to grow. Our
Board of Directors also believes that this structure ensures a
greater role for the independent directors in the oversight of
our Company and active participation of the independent
7
directors in setting agendas and establishing priorities and
procedures for the work of our Board of Directors. Our Board of
Directors believes its administration of its risk oversight
function has not affected its leadership structure.
While our bylaws and corporate governance guidelines do not
require that our Chairman and Chief Executive Officer positions
be separate, our Board of Directors believes that having
separate positions and having an independent outside director
serve as Chairman is the appropriate leadership structure for us
at this time and demonstrates our commitment to good corporate
governance. Our separated Chairman and Chief Executive Officer
positions are augmented by the independence of seven of our
eight directors, and our three fully independent Board
committees that provide appropriate oversight in the areas
described above. At executive sessions of independent directors,
these directors speak candidly on any matter of interest,
without the Chief Executive Officer or other executives present.
The independent directors met four times in 2010 without
management present. We believe this structure provides
consistent and effective oversight of our management and the
Company.
Director
Nominations
The director qualifications developed to date focus on what our
Board believes to be essential competencies to effectively serve
on the Board of Directors. The Nominating and Corporate
Governance Committee must reassess such criteria annually and
submit any proposed changes to the Board of Directors for
approval. Presently, at a minimum, the Nominating and Corporate
Governance Committee must be satisfied that each nominee it
recommends has the highest personal and professional integrity,
demonstrates exceptional ability and judgment and shall be most
effective, in conjunction with the other nominees to the Board
of Directors, in collectively serving the long-term interests of
the stockholders.
In addition to those minimum qualifications, the Nominating and
Corporate Governance Committee shall recommend that our Board of
Directors select persons for nomination to help ensure that:
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a majority of our Board is independent in accordance
with Nasdaq standards;
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each of the Audit Committee, Compensation Committee and
Nominating and Corporate Governance Committee be comprised
entirely of independent directors; and
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at least one member of the Audit Committee shall have the
experience, education and other qualifications necessary to
qualify as an audit committee financial expert as
defined by the rules of the SEC.
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In addition to other standards the Nominating and Corporate
Governance Committee may deem appropriate from time to time for
the overall structure and compensation of the Board of
Directors, the Nominating and Corporate Governance Committee may
consider the following factors when recommending that our Board
select persons for nomination:
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whether a nominee has direct experience in the pharmaceuticals
industry or in the markets in which the Company operates;
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whether the nominee, if elected, assists in achieving a mix of
Board members that represents a diversity of background and
experience.
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Although the Nominating and Corporate Governance Committee may
consider whether nominees assist in achieving a mix of Board
members that represents a diversity of background and
experience, which is not only limited to race, gender or
national origin, we have no formal policy regarding board
diversity.
The Nominating and Corporate Governance Committee adheres to the
following process for identifying and evaluating nominees for
the Board of Directors. First, it solicits recommendations for
nominees from non-employee directors, our Chief Executive
Officer, other executive officers, third-party search firms or
any other source it deems appropriate. The Nominating and
Corporate Governance Committee then reviews and evaluates the
qualifications of proposed nominees and conducts inquiries it
deems appropriate; all proposed nominees are evaluated in the
same manner, regardless of who initially recommended such
nominee. In reviewing and evaluating proposed nominees, the
Nominating and Corporate Governance Committee may consider, in
addition to the minimum qualifications and other criteria for
Board membership approved by our Board from time to time, all
facts and circumstances that it deems appropriate or advisable,
including, among other things, the skills of the proposed
nominee, his or her depth
8
and breadth of business experience or other background
characteristics, his or her independence and the needs of the
Board.
If the Nominating and Corporate Governance Committee decides to
retain a third-party search firm to identify proposed nominees,
it has sole authority to retain and terminate such firm and to
approve any such firms fees and other retention terms.
Each of the nominees for election as director at the 2011 Annual
Meeting is recommended by the Nominating and Corporate
Governance Committee and each nominee is presently a director
and stands for re-election by the stockholders. From time to
time, the Company may pay fees to third-party search firms to
assist in identifying and evaluating potential nominees,
although no such fees have been paid in connection with
nominations to be acted upon at the 2011 Annual Meeting.
Pursuant to our bylaws, stockholders who wish to nominate
persons for election to the Board of Directors at an annual
meeting must be a stockholder of record at the time of giving
the notice, entitled to vote at the meeting, present (in person
or by proxy) at the meeting and must comply with the notice
procedures in our bylaws. A stockholders notice of
nomination to be made at an annual meeting must be delivered to
our principal executive offices not less than 90 days nor
more than 120 days before the anniversary date of the
immediately preceding annual meeting. However, if an annual
meeting is more than 30 days before or more than
60 days after such anniversary date, the notice must be
delivered no later than the 90th day prior to such annual
meeting or, if later, the 10th day following the day on
which the first public announcement of the date of such annual
meeting was made. A stockholders notice of nomination may
not be made at a special meeting unless such special meeting is
held in lieu of an annual meeting. The stockholders notice
must include the following information for the person making the
nomination:
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name and address;
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the class and number of shares of the Company owned beneficially
or of record;
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disclosure regarding any derivative, swap or other transactions
which give the nominating person economic risk similar to
ownership of shares of the Company or provide the opportunity to
profit from an increase in the price of value of shares of the
Company;
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any proxy, agreement, arrangement, understanding or relationship
that confers a right to vote any shares of the Company;
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any agreement, arrangement, understanding or relationship
engaged in for the purpose of acquiring, holding, disposing or
voting of any shares of any class or series of capital stock of
the Company;
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any rights to dividends on the shares that are separate from the
underlying shares;
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any performance related fees that the nominating person is
entitled to based on any increase or decrease in the value of
any shares of the Company;
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a description of all agreements, arrangements or understandings
by and between the proposing stockholder and another person
relating to the proposed business (including an identification
of each party to such agreement, arrangement or understanding
and the names, addresses and class and number of shares owned
beneficially or of record of other stockholders known by the
proposing stockholder support such proposed business;
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a statement whether or not the proposing stockholder will
deliver a proxy statement and form of proxy to holders of, in
the case of a business proposal, at least the percentage of
voting power of all shares of capital stock required to approve
the proposal or, in the case of director nominations, at least
the percentage of voting power of all of the shares of capital
stock reasonably believed by the proposing stockholder to be
sufficient to elect the nominee; and
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any other information relating to the nominating person that
would be required to be disclosed in a proxy statement filed
with the SEC.
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9
With respect to proposed director nominees, the
stockholders notice must include all information required
to be disclosed in a proxy statement in connection with a
contested election of directors or otherwise required pursuant
to Regulation 14A under the Exchange Act (including such
persons written consent to being named in the proxy
statement as a nominee and to serving as a director if elected).
For matters other than the election of directors, the
stockholders notice must also include a brief description
of the business desired to be brought before the meeting, the
reasons for conducting such business at the meeting and any
material interest in such business of the stockholder(s)
proposing the business.
The stockholders notice must be updated and supplemented,
if necessary, so that the information required to be provided in
the notice is true and correct as of the record date for the
meeting and as of the date that is ten business days prior to
the meeting.
The Board of Directors, a designated committee thereof or the
chairman of the meeting will determine if the procedures in the
bylaws have been followed, and if not, declare that the proposal
or nomination be disregarded. The nominee must be willing to
provide any other information reasonably requested by the
Nominating and Corporate Governance Committee in connection with
its evaluation of the nominees independence.
Stockholder
Communications with the Board of Directors
Stockholders may send correspondence to the Board of Directors
c/o the
Secretary at our principal executive offices at the address set
forth above. The Secretary will review all correspondence
addressed to the Board, or any individual Board member, for any
inappropriate correspondence and correspondence more suitably
directed to management. However, the Secretary will summarize
all correspondence not forwarded to the Board and make the
correspondence available to the Board for its review at the
Boards request. The Secretary will forward stockholder
communications to the Board prior to the next regularly
scheduled meeting of the Board of Directors following the
receipt of the communication.
Director
Attendance at Annual Meetings
Directors are encouraged to attend the Annual Meeting of
Stockholders. 7 of the 8 members of the Board of Directors
attended our 2010 Annual Meeting.
Compensation
Committee Interlocks and Insider Participation
None of the members of the Compensation Committee is or has at
any time during the past fiscal year been an officer or employee
of the Company. None of the members of the Compensation
Committee has formerly been an officer of the Company. None of
our executive officers serve or in the past fiscal year has
served as a member of the board of directors or compensation
committee of any other entity that has one or more executive
officers serving as a member of our Board of Directors or
Compensation Committee.
Director
Compensation
Each of our non-employee directors receives a $40,000 annual
retainer fee instead of per-meeting fees. In consideration for
their services, the Chairman of our Board of Directors receives
an additional $40,000, the chairman of our Audit Committee
receives an additional $15,000 and the chairman of our
Compensation Committee receives an additional $10,000, each on
an annual basis.
In addition, since the completion of our initial public offering
(IPO), each new non-employee director receives a
non-qualified stock option to purchase 25,000 shares of our
common stock upon joining the Board, which vests over a
four-year period from the date of grant. In addition, each
non-employee director receives a non-qualified stock option to
purchase 12,000 shares of our common stock each year, which
vests over a one-year period from the date of grant. Any new
Chairman of our Board of Directors would receive a non-qualified
stock option to purchase 45,000 shares of our common stock
upon election to the Board, which would vest over a four-year
period from the date of grant. Our Chairman also receives a
non-qualified stock option to purchase 15,000 shares of our
common stock each year, which vests over a one-year period from
the date of grant.
10
All members of our Board of Directors are eligible to receive
full reimbursement for travel expenses arising from their
attendance of our board meetings.
Director
Compensation Table 2010
The following table sets forth information with respect to the
compensation earned by our non-employee directors during the
fiscal year ended December 31, 2010.
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Fees Earned or
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Option
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Name
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Paid in Cash ($)
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Awards ($)(1)
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Total ($)
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Christopher S. Henney, Ph.D. (Chairman)
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$
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80,000
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$
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37,089
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(2)
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$
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117,089
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Annette Bianchi
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$
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40,000
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$
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29,671
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(3)
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$
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69,671
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James I. Healy, M.D., Ph.D.
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$
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40,000
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$
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29,671
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$
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69,671
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A. Rachel Leheny, Ph.D(4)
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$
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40,000
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$
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29,671
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(5)
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$
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69,671
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Donald J. Santel
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$
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41,250
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$
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29,671
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(6)
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$
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70,921
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Daniel K. Spiegelman(7)
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$
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50,417
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$
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29,671
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(7)
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$
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80,088
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David E. Thompson
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$
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50,000
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$
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29,671
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(8)
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$
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79,671
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Peter A. Thompson(9)
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(1) |
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This column reflects the aggregate grant date fair value of
equity awards granted in 2010 and calculated in accordance with
FASB ASC 718, excluding the effect of estimated
forfeitures. See Note 11 to our financial statements
included in our Annual Report on
Form 10-K
for the year ended December 31, 2010 for a discussion of
the assumptions made in determining the valuation of option
awards. |
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(2) |
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Dr. Henney held 15,000 shares underlying stock options
as of December 31, 2010. |
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(3) |
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Ms. Bianchi held 32,443 shares underlying stock
options as of December 31, 2010. |
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(4) |
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Dr. Leheny resigned from our Board of Directors on
February 1, 2011. |
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(5) |
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Dr. Leheny held 26,602 shares underlying stock options
as of December 31, 2010. |
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(6) |
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Mr. Santel held 32,443 shares underlying stock options
as of December 31, 2010. |
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(7) |
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Mr. Spiegelman joined our Board of Directors on
February 2, 2010. He held 37,000 shares underlying
stock options as of December 31, 2010. |
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(8) |
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Mr. Thompson held 29,523 shares underlying stock
options as of December 31, 2010. |
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(9) |
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Dr. Thompson joined our Board of Directors on
February 1, 2011. |
Required
Vote
The two nominees receiving the highest number of affirmative
votes of all the votes properly cast shall be elected as
directors to serve until the 2014 Annual Meeting of Stockholders
or until their successors have been duly elected and qualified.
Recommendation
of the Board of Directors
The Board of Directors recommends that the stockholders vote FOR
the election of each of the nominees listed above.
PROPOSAL 2
RATIFICATION
OF AUDITORS
The Audit Committee has appointed Deloitte & Touche
LLP as the Companys independent registered public
accounting firm for 2011. Representatives of
Deloitte & Touche LLP will attend the Annual Meeting
of Stockholders and will have the opportunity to make a
statement if they desire to do so. They will also be available
to respond to appropriate questions.
11
The following is a summary of fees billed by
Deloitte & Touche LLP for fiscal years ended December
2010 and 2009:
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2010
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2009
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Audit Fees(1)
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$
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486,575
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$
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362,316
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Audit Related Fees(2)
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Tax Fees(3)
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$
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65,000
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All Other Fees(4)
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$
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2,200
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Total
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$
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553,775
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$
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362,316
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(1) |
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Includes fees associated with the annual audit of our financial
statements, the reviews of our interim financial statements and
the issuance of consent and comfort letters in connection with
registration statements, including filing our registration
statement on
Form S-1
for our initial public offering. |
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(2) |
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We did not incur any audit related fees. |
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(3) |
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Includes fees associated with tax advice and tax planning. |
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(4) |
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Includes fees associated with our subscription to an online
library of accounting literatures. |
Audit
Committee Pre-Approval Policies
The Audit Committee is directly responsible for the appointment,
retention and termination, and for determining the compensation,
of the Companys independent registered public accounting
firm. The Audit Committee shall pre-approve all auditing
services and the terms thereof and non-audit services (other
than non-audit services prohibited under Section 10A(g) of
the Exchange Act or the applicable rules of the SEC or the
Public Company Accounting Oversight Board), except that
pre-approval is not required for the provision of non-audit
services if the de minimus provisions of
Section 10A(i)(1)(B) of the Exchange Act are satisfied. The
Audit Committee may delegate to one or more designated members
of the Audit Committee the authority to grant pre-approvals for
non-audit services, provided such approvals are presented to the
Audit Committee at a subsequent meeting. All services provided
by Deloitte & Touche LLP during fiscal years 2010 and
2009 were pre-approved by the Audit Committee in accordance with
the pre-approval policy described above.
Required
Vote
The ratification of the selection of Deloitte & Touche
LLP requires the affirmative vote of a majority of the votes
cast on the proposal at the Annual Meeting.
Recommendation
of the Board of Directors
The Board of Directors recommends that the stockholders vote
FOR the ratification of the appointment of Deloitte &
Touche LLP as the independent registered public accounting firm
of the Company for its fiscal year ending December 31,
2011.
12
EXECUTIVE
OFFICERS
The names of the executive officers of the Company, their ages
as of March 1, 2011, and certain other information about
them are set forth below (unless set forth elsewhere in this
proxy statement).
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Name
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Age
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Position
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Paul F. Truex
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42
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Chief Executive Officer, President and Director
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Christopher P. Lowe
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43
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Chief Business Officer and Chief Financial Officer
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Colin Hislop, M.D.
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53
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Senior Vice President and Chief Medical Officer
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Debra Odink, Ph.D.
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47
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Senior Vice President, Pharmaceutical Research and Development
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Georgina Kilfoil
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42
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Senior Vice President, Product Development and Clinical
Operations
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The biographies of our executive officers, other than
Mr. Truex, whose biography is set forth above, appear below.
Christopher P. Lowe. Mr. Lowe has served
as our Chief Business Officer and Chief Financial Officer since
February 2011. Prior to that time and since November 2007, he
served as our Chief Financial Officer and Vice President of
Administration. Beginning in September 2005 and up until he
joined the company, Mr. Lowe served as Vice President of
Finance & Administration and, beginning in January
2006, as Chief Financial Officer of Asthmatx, Inc., a medical
technology company. Previously, Mr. Lowe was with Peninsula
Pharmaceuticals, Inc., as Corporate Controller from June 2004 to
October 2004 and Chief Accounting Officer from October 2004
until June 2005. Mr. Lowe holds a B.S. in business
administration from California Polytechnic State University,
San Luis Obispo and an M.B.A. from Saint Marys
University, Texas. Mr. Lowe is a director of Hansen Medical
Corporation, a medical device company.
Colin Hislop, M.D. Dr. Hislop has
served as our Senior Vice President and Chief Medical Officer
since June 2010. Prior to that, he served as our Senior Vice
President of Cardiovascular Products since November 2005 and
also served as a consultant to the company from July 2005
through November 2005. From October 2004 until June 2005,
Dr. Hislop was Vice President, Clinical Development for
Peninsula Pharmaceuticals, Inc. where he oversaw three global
development programs for Peninsulas anti-infective product
portfolio. From September 2001 until September 2004,
Dr. Hislop served as Vice President of Clinical Development
at CV Therapeutics, Inc., a biopharmaceutical company.
Dr. Hislop holds a B.Sc. in medical biochemistry from the
University of Surrey, and a degree in medicine from the
University of London.
Debra Odink, Ph.D. Dr. Odink was
promoted to Senior Vice President of Pharmaceutical Research and
Development in June 2010. Prior to that, she served as our Vice
President of Pharmaceutical Research and Development since
December 2005. From September 2002 until July 2005,
Dr. Odink served as Vice President of Pharmaceutical
Chemistry and Product Development at Peninsula Pharmaceuticals,
Inc., a biopharmaceutical company, where she was responsible for
manufacturing and product development strategies for assets
licensed to Peninsula. Dr. Odink holds a B.S. in chemistry
from California State University, Stanislaus and a Ph.D. in
inorganic chemistry from the University of California at Davis.
Georgina Kilfoil. Ms. Kilfoil has served
as our Senior Vice President, Product Development and Clinical
Operations since March 23, 2010. Prior to joining us,
Ms. Kilfoil was the Vice President, Alliances and Project
Management of Peninsula Pharmaceuticals, Inc. from 2004 to 2005.
From August 2000 to December 2003, Ms. Kilfoil was a
project management consultant with InClin, Inc., a consulting
company. Ms. Kilfoil holds a B.S. in pharmacology from the
University of Bristol, United Kingdom and an M.B.A. from the
Australian Graduate School of Management, Sydney, Australia.
COMPENSATION
DISCUSSION AND ANALYSIS
This section discusses our executive compensation policies and
arrangements as they relate to our named executive officers who
are listed in the compensation tables set forth below. The
following discussion should be read together with the
compensation tables and related disclosures set forth below.
13
Background
and Objectives
We are a biopharmaceutical company focused on developing and
commercializing products to treat serious diseases associated
with inflammation, including cardiovascular and autoimmune
diseases. The success of development companies is significantly
influenced by the quality and motivation of their work forces.
As a result, we face significant competition for executives and
other talented employees from numerous pharmaceutical research
and development companies in the San Francisco Bay Area.
With this in mind, we strive to provide what we believe is a
competitive total compensation package to our executive officers
through a combination of base salary, short-term cash incentives
and long-term equity compensation, in addition to broad-based
employee benefits programs, in order to closely align the
interests of our executive officers with those of our
stockholders, to attract talented individuals to manage and
operate all aspects of our business, to reward these individuals
fairly and to retain those individuals who meet our high
expectations and support the achievement of our business
objectives.
Role of
Compensation Committee and Executive Officers
Our executive compensation program is administered by our board
of directors upon recommendation of our compensation committee.
Our compensation committee is responsible for overseeing our
executive compensation policies, plans and programs, reviewing
our achievements as a company and the achievements of our
individual officers, and recommending to our board of directors
the type and level of compensation for our named executive
officers and our directors. The primary goal of our compensation
committee is to closely align the interests of our named
executive officers with those of our stockholders. To achieve
this goal, our compensation committee relies on compensation
that is designed to attract and retain executives whose
abilities are critical to our long term success, that motivates
individuals to perform at their highest level and that rewards
achievement.
The annual responsibilities of our compensation committee
include the following:
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reviewing and recommending corporate goals and objectives
relevant to the compensation of our Chief Executive Officer and
named executive officers;
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evaluating the performance of our Chief Executive Officer and
named executive officers in light of such corporate goals and
objectives and determining the compensation of our Chief
Executive Officer; and
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reviewing and approving the level of equity awards, annual
salary and bonuses for our named executive officers and other
employees.
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In reviewing and approving these matters, our compensation
committee considers such matters as it deems appropriate,
including our financial and operating performance, the alignment
of interests of our executive officers and our stockholders and
our ability to attract and retain qualified individuals. For
executive compensation decisions, including decisions relating
to the grant of equity awards to our named executive officers,
our compensation committee typically considers the
recommendations of Mr. Truex, our Chief Executive Officer.
Mr. Truex also generally participates in our compensation
committees deliberations about executive compensation
matters. However, Mr. Truex does not participate in the
deliberation or determination of his own compensation.
Our compensation committee has not established any formal
policies or guidelines for allocating compensation between
current and long-term equity compensation, or between cash and
non-cash compensation. In determining the amount and mix of
compensation elements and whether each element provides the
correct incentives and rewards for performance consistent with
our short-term and long-term goals and objectives, our
compensation committee relies on its judgment about each
individuals performance in a rapidly changing business
environment rather than adopting a formulaic approach to
compensatory decisions that are too narrowly responsive to
short-term changes in business performance. In making
determinations about performance, our compensation committee
does not solely rely on formal goals or metrics, but rather
takes into account input from appropriate members of management
with respect to an individuals performance, as well as its
own observations.
Role of
Compensation Consultant
Our compensation committee has the authority under its charter
to engage the services of any consulting firm or other outside
advisor to assist it. Prior to our IPO, in September 2009, our
compensation committee engaged
14
J. Thelander Consulting, an independent consulting firm
selected by our compensation committee, to review and provide
comparative data on the base salary, bonus and equity
compensation of (i) chief executive officers of private
biotechnology companies with funding levels between $50 to
$70 million and (ii) chief executive officers and
other executive officers of publicly traded biotechnology
companies with a market capitalization between $220 to
$375 million. J. Thelander Consulting also provided a
review of the board compensation of such publicly traded
biotechnology companies. Our compensation committee reviewed the
report by J. Thelander Consulting, and in April 2010, made
certain changes to our executive compensation as detailed below
based, in part, on such report.
In December 2010, our compensation committee engaged Remedy
Compensation Consulting (which has since merged with Compensia),
an independent consulting firm specializing in the life sciences
and technology industries, to review and provide comparative
data on the base salary, bonus, equity compensation and total
direct compensation of our executive officers as compared
against 22 similar peer group public biotechnology companies as
well as Northern Californian companies with
50-149 employees
participating in the Radford Life Sciences survey. Our
compensation committee reviewed the report by Remedy
Compensation Consulting and made certain changes to our
executive compensation as detailed below, based in part, on such
report.
The companies in the peer group were as follows:
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Affymax, Inc.
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Neurogesx Inc.
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Alexza Pharmaceuticals, Inc.
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Omeros Corp.
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Amarin Corp.
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Optimer Pharmaceuticals Inc.
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Avanir Pharmaceuticals
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Orexigen Therapeutics, Inc.
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AVI BioPharma Inc.
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Pain Therapeutics Inc.
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Cell Therapeutics, Inc.
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Pharmacyclics Inc.
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Cytokinetics, Inc.
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Sunesis Pharmaceuticals Inc.
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Depomed Inc.
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Supergen Inc.
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DURECT Corporation
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Transcept Pharmaceuticals Inc.
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Ligand Pharmaceuticals Inc.
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Vical, Inc.
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Map Pharmaceuticals Inc.
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Xenoport, Inc.
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J. Thelander Consulting and Remedy Compensation Consulting
were retained by and reported directly to our compensation
committee and do not provide any other services to the Company.
Compensation
Elements
Base Salary. The base salaries of our named
executive officers are primarily established based on the scope
of their responsibilities and performance, taking into account
comparable company data from our compensation consultants and
based upon our compensation committees understanding of
compensation paid to similarly situated executives, and adjusted
as necessary to recruit or retain specific individuals. We
typically review the base salaries of our named executive
officers annually. We may increase the base salary of an
executive officer at other times if a change in the scope of the
executives responsibilities, such as promotion, justifies
such consideration. We believe that a competitive base salary
relative to the companies with which we compete for executives
is a necessary element of any compensation program that is
designed to attract and retain talented and experienced
executives. We also believe that attractive base salaries can
motivate and reward executives for their overall performance.
Base salaries are established in part based on experience,
skills and expected contributions of our executives and our
executives performance during the prior year. In making
determinations about the performance of our named executive
officers, our compensation committee takes into account the
achievement of corporate goals, which are set annually by our
compensation committee and generally include milestones related
to our preclinical and clinical studies and fundraising, as well
as informal individual goals, which are position-specific and
are communicated to the named executive officer over the course
of the year.
After our IPO and taking into consideration the comparative
compensation data from J. Thelander Consulting as mentioned
above, in April 2010, as part of its annual review of
compensation, the board of directors, upon the recommendation of
the compensation committee, approved annual base salary
adjustments for Company
15
employees, including certain of the Companys named
executive officers, which became effective on May 1, 2010.
The adjusted base salaries for such named executive officers
(and their titles at the time) are as follows:
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Annual Base
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Annual Base
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Salary Prior
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Salary Effective
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Named Executive Officer
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to May 1, 2010
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May 1, 2010
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Paul F. Truex,
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$
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300,000
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$
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425,000
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President and Chief Executive Officer
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Christopher P. Lowe,
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$
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250,000
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$
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300,000
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Chief Business Officer and Chief Financial Officer
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Colin Hislop, M.D.,
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$
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270,000
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$
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320,000
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Senior Vice President and Chief Medical Officer
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Debra Odink, Ph.D.,
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$
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200,000
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$
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225,000
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Senior Vice President, Pharmaceutical Research and Development
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In connection with Dr. Odinks promotion to Senior
Vice President, Pharmaceutical Research and Development in June
2010, her annual base salary was increased from $225,000 to
$250,000.
As part of its annual review of compensation and taking into
consideration the comparative compensation data from Remedy
Compensation Consulting as mentioned above, effective
February 1, 2011, our board of directors, upon the
recommendation of the compensation committee, approved annual
base salary adjustments for certain of our employees, including
certain of our named executive officers. Such adjustments were
targeted towards the 50th percentile of base compensation
in our peer group, based on the Remedy Compensation Consulting
data, taking into consideration adjustments for promotions
(including Mr. Lowe to Chief Business Officer). The
adjusted salaries for such named executive officers are as
follows:
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Annual Base
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|
Current Annual
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Salary Effective
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Named Executive Officer
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Base Salary
|
|
February 1, 2011
|
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Paul F. Truex,
|
|
$
|
425,000
|
|
|
$
|
500,000
|
|
President and Chief Executive Officer
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|
|
|
|
|
|
|
|
Christopher P. Lowe,
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|
$
|
300,000
|
|
|
$
|
340,000
|
|
Chief Business Officer and Chief Financial Officer
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|
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|
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|
Colin Hislop, M.D.,
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$
|
320,000
|
|
|
$
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340,000
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Senior Vice President and Chief Medical Officer
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|
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Debra Odink, Ph.D.,
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$
|
250,000
|
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$
|
270,000
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Senior Vice President, Pharmaceutical Research and Development
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Cash Bonuses. Prior to our IPO, we did not
have a formal cash incentive program, although we have paid cash
bonuses based on the achievement of approved operational
milestones in the past. In March 2010, the board of directors
adopted the Companys Executive Incentive Bonus Plan, or
the Bonus Plan, which applies to certain key executives, or the
Executives, that are recommended by the compensation committee
and selected by the board. The Bonus Plan provides for bonus
payments based upon the attainment of performance targets
established by the board and related to financial and
operational metrics with respect to the Company or any of its
subsidiaries, or the Performance Goals, which would include the
achievement of clinical study or operational milestones, results
of clinical studies and achievement of specified financial
metrics or objectives. Any bonuses paid under the Bonus Plan
shall be based upon objectively determinable bonus formulas that
tie such bonuses to one or more performance targets relating to
the Performance Goals. The bonus formulas shall be adopted in
each performance period by the Board and communicated to each
Executive. No bonuses shall be paid under the Bonus Plan unless
and until the Board makes a determination with respect to the
attainment of the performance objectives. Notwithstanding the
foregoing, the Company may adjust bonuses payable under the
Bonus Plan based on achievement of individual performance goals
or pay bonuses (including, without limitation, discretionary
bonuses) to Executives under the Bonus Plan based upon such
other terms and conditions as the Board may in its discretion
determine.
Each Executive is given a targeted bonus opportunity set for
each performance period. The maximum bonus payable to an
Executive under the Bonus Plan is 125% of the Executives
bonus opportunity. The Performance
16
Goals will be measured at the end of each fiscal year after the
Companys financial reports have been published or such
other appropriate time as the board shall determine. If the
Performance Goals are met, payments will be made within
30 days thereafter, and if met for the previous fiscal
year, not later than March 31. An Executive must be
employed by the Company as of the payment date in order to
receive a bonus payment, provided that the board may make
exceptions to this requirement, in its sole discretion,
including, without limitation, in the case of an
Executives termination of employment, retirement, death or
disability.
In April 2010, our board of directors, upon recommendation of
the compensation committee, approved performance bonus awards
under the Bonus Plan based upon certain operational performance,
including successful negotiation and completion of the SPA with
the FDA, reactivation of the IND for
A-623
including submission and acceptance of the Phase II
protocol, completion of equity financings with proceeds to the
Company in excess of $50 million and completion and
submission of our FRANCIS study including a six-month
follow-up
evaluation. Such cash bonus awards were subject to a six-month
lapsing right of repayment in the event of termination or
employment. Our named executive officers received the following
performance cash bonus awards: Mr. Truex ($250,000),
Mr. Lowe ($100,000), Dr. Hislop ($65,000) and
Dr. Odink ($25,000).
In December 2010, our board of directors, upon recommendation of
the compensation committee, approved annual cash bonuses under
the Bonus Plan for performance in 2010. The annual target bonus
opportunities for 2010 (expressed as a percentage of base salary
and targeted towards the 50th percentile of our peer group)
for our named executive officers were as follows: Mr. Truex
(50%), Mr. Lowe (35%), Dr. Hislop (30%),
Dr. Odink (30%) and Ms. Kilfoil (30%). These bonus
payments were based upon the achievement of the following
corporate goals, which were equally weighted:
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continued development of our product candidates, including
initiating enrollment of our VISTA-16 clinical study for
varespladib and obtaining at least a certain level of enrollment
by the end of the year,
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|
initiating Phase 2 enrollment for
A-623 and
completing enrollment by the end of the year,
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|
|
considering strategic partnership opportunities for our product
candidates, and
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|
opportunistically supporting our corporate development
objectives with appropriate financing and budgeting efforts.
|
In determining cash bonuses under the Bonus Plan, our board
determined that 70% of the 2010 corporate goals had been
achieved. Each individuals target bonus was then adjusted
for personal performance. The following cash bonus amounts for
2010 performance were approved for our named executive officers:
Mr. Truex ($148,000), Mr. Lowe ($84,000),
Dr. Hislop ($67,000), Dr. Odink ($55,000) and
Ms. Kilfoil ($37,000).
Equity Incentive Compensation. We generally
grant stock options to our employees, including our named
executive officers, in connection with their initial employment
with us. We also typically grant stock options on an annual
basis as part of annual performance reviews of our employees.
Our compensation committee had previously established grant
guidelines for our employees, other than our Chief Executive
Officer (whose grants were made at the discretion of the board
of directors), based on an employees position, which
guidelines specify a range of equity grant amounts expressed as
a percentage of our common stock outstanding on a fully-diluted
basis, which range from 0.02% to 2.75%, depending on position.
We grant equity incentive compensation to our executive officers
because we believe doing so will motivate our executives by
aligning their interests more closely with the interests of our
stockholders. In the past, we granted restricted stock to
certain initial employees, including Mr. Truex, as we
believed that it was appropriate for our initial key employees
to have an immediate equity stake, and because we believed
owning restricted stock would more closely align the interests
of the recipient with those of our stockholders. Now that we are
a more mature company, we believe it is generally more
appropriate to grant stock options or restricted stock units to
employees, as is the general practice at other companies with
which we compete for talent, although we may continue to grant
restricted stock or grant other types of equity awards when we
deem it appropriate and in our stockholders best interests.
Prior to our IPO, equity incentive grants to our named executive
officers and other employees were made at the discretion of our
board of directors with the recommendation of our compensation
committee out of our 2005
17
Equity Incentive Plan, (the 2005 Plan). In
determining equity incentive grants, the compensation committee
considered the grant guidelines it had established for each
position, along with the equity incentives already provided to
an employee. Our compensation committee also considered
individual performance, based on an informal evaluation of the
individuals contribution to our corporate goals (which
generally include milestones related to our preclinical and
clinical studies and fundraising) and input received from
management. Following our IPO, all stock options continue to be
granted with an exercise price equal to the fair market value of
our common stock on the date of grant, which is defined as the
closing market price of a share of our common stock on the date
of grant. We do not currently have any program, plan or practice
of setting the exercise price based on a date or price other
than the fair value of our common stock on the grant date.
In 2010, our board of directors granted 333,000 restricted stock
units to our employees and options to purchase a total of
112,000 shares of common stock to our directors, including
213,500 restricted stock units to our named executive officers.
In exercising its discretion to determine the amount of each
grant for recommendation to our board of directors, the
compensation committee generally took into account each
individuals contributions towards the achievement of our
annual corporate goals. In March 2010, our board of directors,
upon the compensation committees recommendation, approved
grants of restricted stock units to certain of our employees,
including Mr. Truex, Mr. Lowe, Dr. Hislop and
Dr. Odink, based upon the management teams
contributions to our 2009 and first quarter 2010 operational
performance on a relative scale dependent on such named
executive officers job function and responsibility. The
amount of each grant was based upon industry data as well as
such named executive officers current level of equity
awards. All of these grants were made to further motivate the
recipients by aligning their interests more closely with our
stockholders over the next several years by providing them with
an equity interest in the company. In December 2010, based upon
the Remedy Compensation Consulting data, our board of directors,
upon recommendation of the compensation committee, approved
annual grants of stock options, effective as of January 1,
2011, to certain of our employees, including our named executive
officers, which were intended to target the 50th percentile
of equity awards of our peer group, after giving effect to the
annual grants. Our named executive officers received grants of
stock options to purchase the following shares: Mr. Truex
(260,000 shares), Mr. Lowe (160,000 shares),
Dr. Hislop (170,000 shares), Dr. Odink
(95,000 shares) and Ms. Kilfoil (100,000 shares).
Stock option awards provide our named executive officers and
other employees with the right to purchase shares of our common
stock at a fixed exercise price, subject to their continued
employment. Stock options are earned on the basis of continued
service and generally vest over four years, beginning with
vesting as to 25% of the award on the one-year anniversary of
the date of grant, and pro-rata vesting monthly thereafter.
Stock options granted under the 2010 Plan may not be exercised
prior to the award vesting in full. previously granted under the
2005 Plan may be exercised prior to the award vesting in full,
subject to our right of repurchase. In addition, in the past, we
have also granted options to purchase smaller amounts of stock,
typically fewer than 10,000 shares, which are immediately
vested to recognize employee contributions, including those of
our named executive officers. Furthermore, we generally grant
incentive stock options to employees up to the statutory limit,
then non-statutory options thereafter and non-statutory options
to non-employees. See the section entitled
Potential Payments Upon Termination or Change
in Control for a discussion of the change in control
provisions related to stock options.
Restricted stock units provide our executive officers and other
employees to receive shares of stock upon the vesting of the
restricted stock units, subject to their continued employment.
Restricted stock units generally vest in equal annual
installments over four years. However, we also have granted
restricted stock units that vest in full after one year as a
short-term incentive after our successful IPO. See the section
below entitled Potential Payments Upon Change
in Control and Termination for a discussion of the change
in control provisions related to restricted stock.
After our IPO, we adopted an equity award grant policy that
formalized how we grant equity-based awards to officers and
employees. Under our equity award grant policy, all grants must
be approved by our board of directors or compensation committee.
All stock options will be awarded with an exercise price equal
to the fair value of our common stock and calculated based on
our closing market price on the last trading day of the quarter
in which the grant is approved.
18
Other Compensation. We currently maintain
broad-based benefits that are provided to all employees,
including health insurance, life and disability insurance,
dental insurance and a 401(k) plan.
As discussed below in Severance and Change in
Control Agreements and in Potential
Payments Upon Change in Control and Termination, we have,
for all named executive officers, agreements providing certain
benefits upon termination of their employment in relation to a
change in control, including the acceleration of vesting of
restricted stock and options. Our goal in providing severance
and change in control benefits is to offer sufficient cash
continuity protection such that our executives will focus their
full time and attention on the requirements of the business
rather than the potential implications for their respective
positions. We prefer to have certainty regarding the potential
severance amounts payable to the named executive officers under
certain circumstances, rather than negotiating severance at the
time that a named executive officers employment
terminates. We have also determined that accelerated vesting
provisions in connection with a termination following a change
of control are appropriate because they will encourage our
restricted stock and option holders, including our named
executive officers, to stay focused in such circumstances,
rather than the potential implications for them.
All of our named executive officers are party to severance
agreements that provide benefits upon termination of employment
in connection with a change of control.
Tax and Accounting Treatment of
Compensation. Section 162(m) of the Internal
Revenue Code places a limit of $1.0 million per person on
the amount of compensation that we may deduct in any one year
with respect to each of our named executive officers other than
the chief financial officer. There is an exemption from the
$1.0 million limitation for performance-based compensation
that meets certain requirements. Grants of stock options and
stock appreciation rights under our 2010 Plan are intended to
qualify for the exemption. Restricted stock awards and
restricted stock unit awards under our 2010 Plan, as well as
performance cash awards, may qualify for the exemption if
certain additional requirements are satisfied. To maintain
flexibility in compensating officers in a manner designed to
promote varying corporate goals, our compensation committee has
not adopted a policy requiring all compensation to be
deductible. Although tax deductions for some amounts that we pay
to our named executive officers as compensation may be limited
by section 162(m), that limitation does not result in the
current payment of increased federal income taxes by us due to
our significant net operating loss carry-forwards. Our
compensation committee may approve compensation or changes to
plans, programs or awards that may cause the compensation or
awards to exceed the limitation under section 162(m) if it
determines that such action is appropriate and in our best
interests.
We account for equity compensation paid to our employees under
the rules of FASB ASC 718, which requires us to estimate
and record an expense for each award of equity compensation over
the service period of the award. Accounting rules also require
us to record cash compensation as an expense at the time the
obligation is incurred.
19
COMPENSATION
OF EXECUTIVE OFFICERS
Summary
Compensation Table
The following table summarizes the compensation that we paid to
our Chief Executive Officer, Chief Financial Officer and each of
our three other most highly compensated executive officers
during the years ended December 31, 2010, 2009 and 2008. We
refer to these officers in this proxy statement as our named
executive officers.
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Non-Equity
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Incentive
|
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|
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Stock
|
|
Plan
|
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|
Name and Principal Position as of
|
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|
Salary
|
|
Bonus
|
|
Awards
|
|
Compensation
|
|
|
December 31, 2010
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Year
|
|
($)
|
|
($)
|
|
($)(1)
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|
($)(2)
|
|
Total ($)
|
|
Paul F. Truex
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|
|
2010
|
|
|
$
|
383,333
|
|
|
|
|
|
|
$
|
460,960
|
|
|
$
|
398,000
|
|
|
$
|
1,242,293
|
|
President, Chief Executive Officer
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|
|
2009
|
|
|
$
|
281,837
|
|
|
|
|
|
|
$
|
88,125
|
|
|
|
|
|
|
$
|
369,962
|
|
and Director
|
|
|
2008
|
|
|
$
|
300,000
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
$
|
300,000
|
|
Christopher P. Lowe
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|
|
2010
|
|
|
$
|
283,333
|
|
|
|
|
|
|
$
|
214,400
|
|
|
$
|
184,000
|
|
|
$
|
681,733
|
|
Chief Business Officer and
|
|
|
2009
|
|
|
$
|
241,174
|
|
|
|
|
|
|
$
|
23,500
|
|
|
|
|
|
|
$
|
264,674
|
|
Chief Financial Officer
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|
|
2008
|
|
|
$
|
250,000
|
|
|
|
|
|
|
$
|
117,411
|
|
|
|
|
|
|
$
|
367,411
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|
Colin Hislop, M.D.
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|
|
2010
|
|
|
$
|
303,333
|
|
|
|
|
|
|
$
|
214,400
|
|
|
$
|
132,000
|
|
|
$
|
649,733
|
|
Senior Vice President,
|
|
|
2009
|
|
|
$
|
259,621
|
|
|
$
|
1,247
|
|
|
$
|
28,795
|
|
|
|
|
|
|
$
|
289,663
|
|
Cardiovascular Products
|
|
|
2008
|
|
|
$
|
270,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
270,000
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|
Debra Odink, Ph.D.
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|
|
2010
|
|
|
$
|
232,179
|
|
|
|
|
|
|
$
|
134,000
|
|
|
$
|
80,000
|
|
|
$
|
446,179
|
|
Senior Vice President, Pharmaceutical
|
|
|
2009
|
|
|
$
|
158,580
|
|
|
$
|
3,996
|
|
|
$
|
29,375
|
|
|
|
|
|
|
$
|
191,951
|
|
Research and Development
|
|
|
2008
|
|
|
$
|
200,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
200,000
|
|
Georgina Kilfoil(3)
|
|
|
2010
|
|
|
$
|
197,917
|
|
|
|
|
|
|
$
|
120,600
|
|
|
$
|
37,000
|
|
|
$
|
355,517
|
|
Senior Vice President, Development
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
And Clinical Operations
|
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
This column reflects the aggregate grant date fair value of
equity awards granted in 2010, 2009 and 2008. During 2010, we
granted restricted stock units to our executive officers and the
grant date fair value is calculated based on the closing sales
price of our common stock on the grant date and in accordance
with FASB ASC 718. During 2009 and 2008, we granted
stock options to our executive officers and the grant date fair
value is calculated in accordance with FASB ASC 718,
excluding the effect of estimated forfeitures. See Note 11
to our financial statements included in our Annual Report on
Form 10-K
for the year ended December 31, 2010 for a discussion of
the assumptions made in determining the valuation of option
awards. |
|
(2) |
|
Includes performance cash bonus awards paid following our
initial public offering and annual cash performance bonus awards
paid in 2011 for 2010 performance. |
|
(3) |
|
Ms. Kilfoil joined us on March 16, 2010. |
20
Grants of
Plan-Based Awards
The following table sets forth certain information with respect
to awards under our equity and non-equity incentive plans made
by us to our named executive officers and stock options awarded
to our named executive officers for the year ended
December 31, 2010.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other
|
|
|
|
|
|
|
Estimated Future Payouts
|
|
Stock Awards:
|
|
|
|
|
|
|
Under Non-Equity Incentive
|
|
Number of
|
|
Grant Date
|
|
|
|
|
Plan Awards(4)
|
|
Shares of
|
|
Fair Value of
|
|
|
Grant
|
|
Target
|
|
Maximum
|
|
Stock or
|
|
Stock Awards
|
Name
|
|
Date
|
|
($)
|
|
($)(5)
|
|
Units (#)
|
|
($)(3)
|
|
Paul F. Truex
|
|
|
6/30/2010(1
|
)
|
|
|
|
|
|
|
|
|
|
|
50,000
|
|
|
$
|
268,000
|
|
|
|
|
6/30/2010(2
|
)
|
|
|
|
|
|
|
|
|
|
|
36,000
|
|
|
$
|
192,960
|
|
|
|
|
|
|
|
$
|
212,500
|
|
|
$
|
531,250
|
|
|
|
|
|
|
|
|
|
Christopher P. Lowe
|
|
|
6/30/2010(1
|
)
|
|
|
|
|
|
|
|
|
|
|
22,000
|
|
|
$
|
117,920
|
|
|
|
|
6/30/2010(2
|
)
|
|
|
|
|
|
|
|
|
|
|
18,000
|
|
|
$
|
96,480
|
|
|
|
|
|
|
|
$
|
105,000
|
|
|
$
|
375,000
|
|
|
|
|
|
|
|
|
|
Colin Hislop, M.D.
|
|
|
6/30/2010(1
|
)
|
|
|
|
|
|
|
|
|
|
|
30,000
|
|
|
$
|
160,800
|
|
|
|
|
6/30/2010(2
|
)
|
|
|
|
|
|
|
|
|
|
|
10,000
|
|
|
$
|
53,600
|
|
|
|
|
|
|
|
$
|
96,000
|
|
|
$
|
400,000
|
|
|
|
|
|
|
|
|
|
Debra Odink, Ph.D.
|
|
|
6/30/2010(1
|
)
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
|
$
|
107,200
|
|
|
|
|
6/30/2010(2
|
)
|
|
|
|
|
|
|
|
|
|
|
5,000
|
|
|
$
|
26,800
|
|
|
|
|
|
|
|
$
|
75,000
|
|
|
$
|
312,500
|
|
|
|
|
|
|
|
|
|
Georgina Kilfoil
|
|
|
6/30/2010(1
|
)
|
|
|
|
|
|
|
|
|
|
|
22,500
|
|
|
$
|
120,600
|
|
|
|
|
|
|
|
$
|
59,400
|
(6)
|
|
$
|
247,396
|
(6)
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
These restricted stock units vest in equal annual installments
over four years. The vesting commencement date of these grants
is June 30, 2010. |
|
(2) |
|
These restricted stock units vest in one annual installment. The
vesting commencement date of these grants is June 30, 2010. |
|
(3) |
|
The grant date fair value of each equity award is calculated
based on the closing sales price of our common stock on the date
of grant in accordance with FASB ASC 718, excluding the
effect of estimated forfeitures. |
|
(4) |
|
The plan does not have a threshold. |
|
(5) |
|
The plan allows for a bonus payment of up to 125% of the
executive officers salary. |
|
(6) |
|
Ms. Kilfoil joined us on March 16, 2010. This number
is prorated based on her service for the year. |
21
Outstanding
Equity Awards at Fiscal Year-End
The following table sets forth certain information with respect
to outstanding equity awards as of December 31, 2010 with
respect to our named executive officers.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
|
|
Number of
|
|
Number of
|
|
|
|
|
|
Number of
|
|
Market Value
|
|
|
Securities
|
|
Securities
|
|
|
|
|
|
Shares or
|
|
of Shares
|
|
|
Underlying
|
|
Underlying
|
|
|
|
|
|
Units of
|
|
or Units
|
|
|
Unexercised
|
|
Unexercised
|
|
Option
|
|
|
|
Stock
|
|
of Stock
|
|
|
Options
|
|
Options
|
|
Exercise
|
|
Option
|
|
That Have
|
|
That Have
|
|
|
Exercisable
|
|
Unexercisable
|
|
Price
|
|
Expiration
|
|
Not Vested
|
|
Not Vested
|
Name
|
|
(#)
|
|
(#)*
|
|
($)
|
|
Date
|
|
(#)
|
|
($)
|
|
Paul F. Truex
|
|
|
362,826
|
|
|
|
|
|
|
$
|
0.26
|
|
|
|
1/23/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
52,548
|
|
|
|
13,828
|
(2)
|
|
$
|
1.51
|
|
|
|
2/18/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
16,815
|
|
|
|
4,425
|
(3)
|
|
$
|
1.51
|
|
|
|
2/18/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
(7)
|
|
$
|
244,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36,000
|
(8)
|
|
$
|
175,680
|
|
Christopher P. Lowe
|
|
|
2,920
|
(4)
|
|
|
|
|
|
$
|
0.14
|
|
|
|
3/6/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
57,725
|
|
|
|
17,161
|
(5)
|
|
$
|
1.34
|
|
|
|
2/21/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
36,828
|
|
|
|
10,949
|
(6)
|
|
$
|
1.34
|
|
|
|
2/21/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
18,497
|
|
|
|
4,867
|
(2)
|
|
$
|
1.51
|
|
|
|
2/18/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,000
|
(7)
|
|
$
|
107,360
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,000
|
(8)
|
|
$
|
87,840
|
|
Colin Hislop, M.D.
|
|
|
130,447
|
|
|
|
|
|
|
$
|
0.26
|
|
|
|
1/23/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
18,497
|
|
|
|
4,867
|
(2)
|
|
$
|
1.51
|
|
|
|
2/18/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
5,257
|
|
|
|
|
|
|
$
|
1.51
|
|
|
|
4/15/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,000
|
(7)
|
|
$
|
146,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,000
|
(8)
|
|
$
|
48,800
|
|
Debra Odink, Ph.D.
|
|
|
23,121
|
|
|
|
6,084
|
(2)
|
|
$
|
1.51
|
|
|
|
2/18/2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
(7)
|
|
$
|
97,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,000
|
(8)
|
|
$
|
24,400
|
|
Georgina Kilfoil
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,500
|
(7)
|
|
$
|
109,800
|
|
|
|
|
* |
|
Unless otherwise noted in the footnotes, these options vest over
four years as follows: 25% of the shares vest one year following
the vesting commencement date, with the remaining 75% vesting in
equal monthly installments over the next three years. All
unvested options, pursuant to the 2005 Equity Plan, contain an
early exercise feature subject to the Companys right of
repurchase. |
|
(1) |
|
Represents the closing market price of our common stock as of
December 31, 2010 ($4.88) multiplied by the number of
restricted stock units. |
|
(2) |
|
This incentive stock option vests in equal monthly installments
over four years commencing on August 12, 2008. |
|
(3) |
|
This non-statutory stock option vests in equal monthly
installments over four years commencing on August 12, 2008. |
|
(4) |
|
These options were granted to Mr. Lowe on March 6,
2006 in his capacity as a consultant to the Company and vested
immediately on the grant date. |
|
(5) |
|
The vesting commencement date of this incentive stock option is
November 26, 2007. |
|
(6) |
|
The vesting commencement date of this non-statutory stock option
is November 26, 2007. |
|
(7) |
|
These restricted stock units vest in equal annual installments
over four years. The vesting commencement date of these grants
is June 30, 2010. |
|
(8) |
|
These restricted stock units vest in one annual installment. The
vesting commencement date of these grants is June 30, 2010. |
22
Option
Exercises and Stock Vested
Options
Exercised 2010
The following table sets forth certain information with respect
to the options exercised during the year ended December 31,
2010 with respect to our named executive officers. There was no
vesting of stock awards during the year ended December 31,
2010 with respect to our named executive officers.
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
Number of
|
|
Value
|
|
|
Shares
|
|
Realized on
|
|
|
Acquired on
|
|
Exercise
|
Name
|
|
Exercise (#)
|
|
($)(1)
|
|
Paul F. Truex
|
|
|
23,364
|
|
|
$
|
158,642
|
|
Christopher P. Lowe
|
|
|
|
|
|
|
|
|
Colin Hislop, M.D.
|
|
|
14,683
|
|
|
$
|
43,021
|
|
Debra Odink, Ph.D.
|
|
|
|
|
|
|
|
|
Georgina Kilfoil
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
This column reflects the value realized for vested options
exercised in 2010, which represents the difference between the
market price of our common stock on the date of exercise and the
exercise price of the stock option. |
Stock and
Benefit Plans
2005
Equity Incentive Plan
Our 2005 Plan was adopted by our board of directors and approved
by our stockholders in April 2005. We have reserved
2,175,817 shares of our common stock for the issuance of
awards under the 2005 Plan.
Our 2005 Plan is administered by our board of directors, which
has the authority to delegate full power and authority to a
committee of the board. Our board of directors or any committee
delegated by our board of directors has the power to select the
individuals to whom awards will be granted, to make any
combination of awards to participants, to accelerate the
exercisability or vesting of any award, to provide substitute
awards and to determine the specific terms and conditions of
each award, subject to the provisions of the 2005 Plan.
The 2005 Plan permits us to make grants of incentive stock
options, non-qualified stock options, restricted stock awards
and stock appreciation rights to employees, directors and
consultants. Stock options granted under the 2005 Plan have a
maximum term of 10 years from the date of grant and
incentive stock options have an exercise price of no less than
the fair market value of our common stock on the date of grant.
Upon a sale event in which all awards are not assumed or
substituted by the successor entity, the vesting of awards under
the 2005 Plan shall be accelerated in full prior to the sale
event and all stock options issued thereunder will terminate.
All stock option awards that are granted to our named executive
officers are covered by a stock option agreement. Except as
noted above, under the stock option agreements, 25% of the
shares vest on the first anniversary of the grant date and the
remaining shares vest monthly over the following three years.
Our board of directors may accelerate the vesting schedule in
its discretion. We did not engage in any option repricing or
other modification to any of our outstanding equity awards
during the fiscal year ended December 31, 2010.
Our board of directors has determined not to grant any further
awards under the 2005 Plan after the completion of our IPO. We
have adopted the 2010 Plan effective upon the consummation of
our IPO in March 2010.
Amended
and Restated 2010 Stock Option and Incentive Plan
In February 2010, our board of directors, upon the
recommendation of our compensation committee, approved the 2010
Plan, which was also approved by our stockholders. Our board of
directors subsequently approved the amendment and restatement of
our 2010 Plan, which was approved by our stockholders at our
annual stockholders meeting held in July 2010. The 2010
Plan became effective upon the consummation of our IPO and
replaced the 2005 Plan, as our board of directors determined not
to make additional awards under that plan once the 2010 Plan
23
became effective. The 2010 Plan provides flexibility to our
compensation committee to use various equity-based incentive
awards as compensation tools to motivate our workforce.
We initially reserved 233,644 shares of our common stock
for the issuance of awards under the 2010 Plan plus an
additional 35,670 shares of common stock available for
grant under our 2005 Plan, which shares were added to the shares
reserved under our 2010 Plan, and an additional
200,000 shares that were added by the amendment and
restatement approved at our 2010 annual stockholders
meeting. The 2010 Plan provides that the number of shares
reserved and available for issuance under the plan will
automatically increase each January 1, beginning in 2011,
by 4% of the outstanding number of shares of common stock on the
immediately preceding December 31. This number is subject
to adjustment in the event of a stock split, stock dividend or
other change in our capitalization.
The shares we issue under the 2010 Plan are authorized but
unissued shares or shares that we reacquire. The shares of
common stock underlying any awards that are forfeited, canceled,
held back upon exercise or settlement of an award to satisfy the
exercise price or tax withholding, reacquired by us prior to
vesting, satisfied without any issuance of stock, expire or are
otherwise terminated (other than by exercise) under the 2010
Plan are added back to the shares of common stock available for
issuance under the 2010 Plan.
The 2010 Plan is administered by our board of directors under
recommendation by our compensation committee. Our board of
directors has full power to select, from among the individuals
eligible for awards, the individuals to whom awards will be
granted, to make any combination of awards to participants and
to determine the specific terms and conditions of each award,
subject to the provisions of the 2010 Plan. The board of
directors may delegate to our compensation committee or our
Chief Executive Officer the authority to grant options to
certain individuals. Persons eligible to participate in the 2010
Plan will be those of our full or part-time officers, employees,
non-employee directors and other key persons (including
consultants and prospective employees) as selected from time to
time by our board of directors in its discretion.
The 2010 Plan permits the granting of (i) options to
purchase common stock intended to qualify as incentive stock
options under Section 422 of the Internal Revenue Code of
1986, as amended, and the regulations thereunder, or the Code,
and (ii) options that do not so qualify. The option
exercise price of each option will be determined by our
compensation committee but may not be less than 100% of the fair
market value of the common stock on the date of grant. The term
of each option will be fixed by our compensation committee and
may not exceed 10 years from the date of grant. Our
compensation committee will determine at what time or times each
option may be exercised.
Our board of directors may award stock appreciation rights
subject to such conditions and restrictions as our compensation
board of directors may determine. Stock appreciation rights
entitle the recipient to shares of common stock equal to the
value of the appreciation in the stock price over the exercise
price. The exercise price shall not be less than the fair market
value of the common stock on the date of grant.
Our board of directors may award restricted shares of common
stock to participants subject to such conditions and
restrictions as our compensation committee may determine. These
conditions and restrictions may include the achievement of
certain performance goals
and/or
continued employment with us through a specified restricted
period. Our compensation committee may award restricted stock
units to any participants. Restricted stock units are ultimately
payable in the form of shares of common stock and may be subject
to such conditions and restrictions as our compensation
committee may determine. These conditions and restrictions may
include the achievement of certain performance goals
and/or
continued employment through a specified vesting period. Our
board of directors may also grant shares of common stock which
are free from any restrictions under the 2010 Plan. Unrestricted
stock may be granted to any participant in recognition of past
services or other valid consideration and may be issued in lieu
of cash compensation due to such participant.
Our board of directors may grant performance share awards to any
participant which entitles the recipient to receive shares of
common stock upon the achievement of certain performance goals
and such other conditions as our compensation committee shall
determine.
Our board of directors may grant dividend equivalent rights to
participants which entitle the recipient to receive credits for
dividends that would be paid if the recipient had held specified
shares of common stock.
24
Our board of directors may grant cash bonuses under the 2010
Plan to participants. The cash bonuses may be subject to the
achievement of certain performance goals.
The 2010 Plan also provides that upon the effectiveness of a
sale event as defined in the 2010 Plan, except as
otherwise provided by our compensation committee in the award
agreement, all awards will automatically terminate, unless the
parties to the sale event agree that such awards will be assumed
or continued by the successor entity. Awards with conditions and
restrictions relating to the attainment of performance goals may
become vested and non-forfeitable in connection with a sale
event in the compensation committees discretion. In
addition, in the case of a sale event in which our stockholders
will receive cash consideration, we may make or provide for a
cash payment to participants holding options and stock
appreciation rights equal to the difference between the per
share cash consideration and the exercise price of the options
or stock appreciation rights.
No awards may be granted under the 2010 Plan after the date that
is 10 years from the date of stockholder approval.
2010
Employee Stock Purchase Plan
Our board of directors adopted the Anthera Pharmaceuticals, Inc.
2010 Employee Stock Purchase Plan (the ESPP), and
our stockholders approved the ESPP at our 2010 annual
stockholders meeting. Our Board of Directors subsequently
amended the ESPP on December 15, 2010. Our Board of
Directors subsequently amended the ESPP on December 15,
2010. We have reserved 100,000 shares of common stock for
issuance thereunder plus on January 1, 2011 and each
January 1 thereafter, the number of shares of stock reserved and
available for issuance under the Plan shall be cumulatively
increased by the lesser of (i) one percent (1%) of the
number of shares of common stock issued and outstanding on the
immediately preceding December 31 or
(ii) 250,000 shares of common stock. Under the ESPP,
eligible employees of the Company and certain designated
subsidiaries of the Company may authorize the Company to deduct
amounts from their compensation, which amounts are used to
enable the employees to purchase shares of the Companys
common stock. The purpose of the ESPP is to attract and retain
key personnel, and encourage stock ownership by the
Companys employees.
The ESPP is a broad-based employee stock purchase plan under
Section 423 of the Code.
The shares that are reserved under the ESPP have an aggregate
value of approximately $0.5 million based on the closing
price of the common stock as reported on The NASDAQ Global
Market on December 31, 2010.
The ESPP is administered by the person or persons appointed by
the Companys board of directors. The ESPP provides that
all employees of the Company and any designated subsidiaries of
the Company who work at least 20 hours per week are
eligible to participate in the ESPP, except for persons who are
deemed under Section 423(b)(3) of the Code to own five
percent (5%) or more of the voting stock of the Company.
Participation by any eligible employee is voluntary. The number
of employees potentially eligible to participate in the ESPP is
approximately 20 persons.
The ESPP provides for two offering periods within
each year, and the first commenced on September 1, 2010 and
ended on December 31, 2010. Thereafter, the first offering
period in a year will commence on the first business day
occurring on or after each January 1 and ending on the last
business day occurring on or before the following June 30,
and the second will commence on the first business day occurring
on or after each July 1 and ending on the last business day
occurring on or before the following December 31. Eligible
employees may elect to become participants in the ESPP by
enrolling prior to each semi-annual date to purchase shares
under the ESPP. Shares are purchased through the accumulation of
payroll deductions of not less than one percent (1%) nor more
than ten percent (10%) of each participants compensation.
The maximum number of shares of common stock that can be
purchased under the ESPP during any one calendar year is that
number having a fair market value of $25,000 on the first day of
the purchase period pursuant to which the shares are purchased.
The number of shares to be purchased with respect to any
purchase period will be the lesser of (a) the number of
shares determined by dividing the participants balance in
the plan account on the last day of the purchase period by the
purchase price per share for the stock,
(b) 10,000 shares, and (c) such other lesser
maximum number of shares as shall have been established by the
administrator in advance of the offering. The purchase price per
share will be 85% of the fair market value of the common stock
as of the first date or the ending date of the applicable
semi-annual purchase period, whichever is less.
25
A participants right to purchase shares during a purchase
period under the ESPP is not transferable by the participant
except by will or by the laws of descent and distribution.
Employees may cease their participation in the offering at any
time during the offering period, and participation automatically
ceases on termination of employment with the Company.
The number of shares that are reserved for issuance under the
ESPP is subject to adjustment for stock splits and similar
events. The proceeds received by the Company from exercise under
the ESPP will be used for the general purposes of the Company.
Shares issued under the ESPP may be authorized but unissued
shares or shares reacquired by the Company and held in its
treasury.
The ESPP shall remain in full force and effect until suspended
or discontinued by our board of directors. Our board of
directors may, at any time, terminate the ESPP; provided, that
the ESPP shall automatically terminate in accordance with its
terms as of the tenth anniversary of its adoption by the board
of directors. Our board of directors may at any time, and from
time to time, amend the ESPP in any respect, except that without
the approval within 12 months of such board action by the
stockholders, no amendment may be made increasing the number of
shares approved for the ESPP or making any other change that
would require stockholder approval in order for the ESPP, as
amended, to qualify as an employee stock purchase
plan under Section 423(b) of the Code.
401(k)
Savings Plan
We have established a 401(k) plan to allow our employees to save
on a tax-favorable basis for their retirement. We do not match
any contributions made by any employees, including our named
executive officers, pursuant to the plan.
Pension
Benefits
None of our named executive officers participate in or have
account balances in pension benefit plans sponsored by us.
Nonqualified
Defined Contribution and Other Nonqualified Defined Compensation
Plans
None of our named executive officers participate in or have
account balances in non-qualified defined contribution plans or
other deferred compensation plans maintained by us.
Severance
and Change in Control Arrangements
We consider it essential to the best interests of our
stockholders to foster the continuous employment of our key
management personnel. In this regard, we recognize that the
possibility of a change in control may exist and that the
uncertainty and questions that it may raise among management
could result in the departure or distraction of management
personnel to the detriment of the Company and our stockholders.
In order to reinforce and encourage the continued attention and
dedication of certain key members of management, we have entered
into several change in control agreements and severance
agreements with certain of our executive officers.
In these agreements, the definition of change in
control generally means the occurrence, in a single
transaction or in a series of related transactions of any one or
more of the following events, subject to specified events:
(a) any Exchange Act Person (defined in the change in
control agreements generally as any natural person, entity, or
group not including the Company or any subsidiaries) becomes the
owner of securities representing more than 50% of the combined
voting power of our then outstanding securities; (b) a
merger, consolidation or similar transaction involving the
Company is consummated and immediately after the consummation of
such merger, consolidation, or similar transaction, our
stockholders immediately prior thereto do not own either
outstanding voting securities representing more than 50% of the
combined outstanding voting power of the surviving entity or
more than 50% of the combined outstanding voting power of the
parent of the surviving entity in such merger, consolidation, or
similar transaction; or (c) a sale, lease, license or other
disposition of all or substantially all of our consolidated
assets is consummated.
In these agreements, cause means: (a) gross
negligence or willful misconduct in the performance of duties
that is not cured within 30 days of written notice, where
such gross negligence or willful misconduct has resulted or
26
is likely to result in substantial and material damage to the
Company; (b) repeated unexplained or unjustified absence;
(c) a material and willful violation of any federal or
state law; (d) commission of any act of fraud with respect
to the Company; or (e) commission of an act of moral
turpitude or conviction of or entry of a plea of nolo contendere
to a felony.
Constructive termination means an
officers resignation within 180 days of the
occurrence of any of the following events without the
officers prior written consent, provided the officer
provides notice within 90 days of the first occurrence of
such event and such event remains uncured 30 days after
delivery of the written notice: (a) a material diminution
of such officers duties, responsibilities or authority;
(b) a material diminution of base compensation; or
(c) a material change in the geographic location at which
the officer provides services to us.
Paul
F. Truex
On October 15, 2009, we entered into an amended and
restated change in control agreement with Mr. Truex. Upon
the occurrence of a change in control or within 12 months
thereafter, if we terminate Mr. Truexs employment for
any reason other than for cause or if there is a constructive
termination, in either case, Mr. Truex is entitled to
receive as severance compensation 100% of his then-current base
salary for a period of up to 12 months and payment of
continuation coverage premiums for health, dental, and vision
benefits for Mr. Truex and his covered dependents, if any,
for a period of 12 months pursuant to COBRA. In addition,
Mr. Truex is entitled to receive
(i) 12 months accelerated vesting of any
unvested options to purchase our common stock and (ii) the
immediate lapsing of any vesting restrictions on any restricted
stock awards as of the date of termination.
Christopher
P. Lowe
On October 12, 2009, we entered into an amended and
restated change in control agreement with Mr. Lowe. Upon
the occurrence of a change in control or within 12 months
thereafter, if we terminate Mr. Lowes employment for
any reason other than for cause or if there is a constructive
termination, in either case, Mr. Lowe is entitled to
receive as severance compensation 100% of his then-current base
salary for a period of up to 12 months and payment of
continuation coverage premiums for health, dental, and vision
benefits for Mr. Lowe and his covered dependents, if any,
for a period of 12 months pursuant to COBRA. In addition,
Mr. Lowe is entitled to receive
(i) 12 months accelerated vesting of any
unvested options to purchase our common stock and (ii) the
immediate lapsing of any vesting restrictions on any restricted
stock awards as of the date of termination.
Colin
Hislop, M.D.
On October 15, 2009, we entered into an amended and
restated change in control agreement with Dr. Hislop. Upon
the occurrence of a change in control or within 12 months
thereafter, if we terminate Dr. Hislops employment
for any reason other than for cause or if there is a
constructive termination, in either case, Dr. Hislop is
entitled to receive as severance compensation 100% of his
then-current base salary for a period of up to six months and
payment of continuation coverage premiums for health, dental,
and vision benefits for Dr. Hislop and his covered
dependents, if any, for a period of six months pursuant to
COBRA. In addition, Dr. Hislop is entitled to receive
(i) six months accelerated vesting of any unvested
options to purchase our common stock and (ii) the immediate
lapsing of any vesting restrictions on any restricted stock
awards as of the date of termination.
Debra
Odink, Ph.D.
On October 15, 2009, we entered into an amended and
restated change in control agreement with Dr. Odink. Upon
the occurrence of a change in control or within 12 months
thereafter, if we terminate Dr. Odinks employment for
any reason other than for cause or if there is a constructive
termination, in either case, Dr. Odink is entitled to
receive as severance compensation 100% of her then-current base
salary for a period of up to six months and payment of
continuation coverage premiums for health, dental, and vision
benefits for Dr. Odink and her covered dependents, if any,
for a period of six months pursuant to COBRA. In addition,
Dr. Odink is entitled to receive (i) six months
accelerated vesting of any unvested options to purchase our
common stock and (ii) the immediate lapsing of any vesting
restrictions on any restricted stock awards as of the date of
termination.
27
Georgina
Kilfoil
On July 7, 2010, we entered into a change in control
agreement with Ms. Kilfoil. Upon the occurrence of a change
in control or within 12 months thereafter, if we terminate
Ms. Kilfoils employment for any reason other than for
cause or if there is a constructive termination, in either case,
Ms. Kilfoil is entitled to receive as severance
compensation 100% of her then-current base salary for a period
of up to twelve months and payment of continuation coverage
premiums for health, dental, and vision benefits for
Ms. Kilfoil and her covered dependents, if any, for a
period of twelve months pursuant to COBRA. In addition,
Ms. Kilfoil is entitled to receive (i) twelve
months accelerated vesting of any unvested options to
purchase our common stock and (ii) the immediate lapsing of
any vesting restrictions on any restricted stock awards as of
the date of termination.
All payments and benefits are conditioned on the
executives execution and non-revocation of a general
release agreement at the time of termination. All payments due
upon termination (as discussed in this entire section) may be
delayed up to six months from the termination date if necessary
to avoid adverse tax treatment under Section 409A of the
Internal Revenue Code.
Potential
Payments Upon Change in Control and Termination
The tables below reflect potential payments and benefits
available for each of our named executive officers upon
termination in connection with a change in control or
termination, assuming the date of occurrence is
December 31, 2010. See section entitled
Severance and Change in Control
Agreements above.
Named
Executive Officer Benefits and Payments Upon
Termination(1)
|
|
|
|
|
|
|
Involuntary
|
|
|
Termination within
|
|
|
One Year of Change
|
Name
|
|
in Control(2)
|
|
Paul F. Truex
|
|
$
|
431,704
|
|
Christopher P. Lowe
|
|
$
|
305,847
|
|
Colin Hislop, M.D.
|
|
$
|
163,261
|
|
Debra Odink, Ph.D.
|
|
$
|
127,878
|
|
Georgina Kilfoil
|
|
$
|
256,265
|
|
|
|
|
(1) |
|
Assumes triggering event effective as of December 31, 2010.
Upon a voluntary termination or termination for cause, each
named executive officer would receive any earned but unpaid base
salary until December 31, 2010. These payments would be
available to all employees upon termination. |
|
(2) |
|
Includes continuation of base salary determined as of
December 31, 2010 and health, dental and vision benefits
for 12 months for Mr. Truex, Mr. Lowe and
Ms. Kilfoil. All other named executive officers receive six
months continuation of base salary and benefits. |
Acceleration
of Vesting of Options and Stock upon
Termination(1)
|
|
|
|
|
|
|
Number of Shares of
|
|
|
Accelerated Stock and Value
|
|
|
Upon Involuntary
|
|
|
Termination and in
|
|
|
Connection with a
|
Name
|
|
Change in Control(2)
|
|
Paul F. Truex
|
|
$
|
456,588
|
(3)
|
Christopher P. Lowe
|
|
$
|
304,550
|
(4)
|
Colin Hislop, M.D.
|
|
$
|
200,120
|
(5)
|
Debra Odink, Ph.D.
|
|
$
|
128,150
|
(6)
|
Georgina Kilfoil
|
|
$
|
109,800
|
(7)
|
|
|
|
(1) |
|
Assumes triggering event effective as of December 31, 2010
and excludes vested stock held as of such date. The market value
of the accelerated option shares is based on the difference
between our closing price of $4.88 per |
28
|
|
|
|
|
share on December 31, 2010 and the exercise price of such
accelerated options. The market value of the accelerated
restricted stock units is based on the closing price of $4.88
per share on December 31, 2010. |
|
(2) |
|
Includes acceleration of options for 12 months for
Mr. Truex, Mr. Lowe and Ms. Kilfoil. All other
named executive officers have six months acceleration of
options. |
|
(3) |
|
10,952 of Mr. Truexs options and 86,000 shares
of Mr. Truexs restricted stock units would accelerate
upon involuntary termination and in connection with a change of
control. |
|
(4) |
|
31,030 of Mr. Lowes options and 40,000 shares of
Mr. Lowes restricted stock units would accelerate
upon involuntary termination and in connection with a change of
control. |
|
(5) |
|
1,460 of Dr. Hislops options and 40,000 shares
of Dr. Hislops restricted stock units would
accelerate upon involuntary termination and in connection with a
change of control. |
|
(6) |
|
1,825 of Dr. Odinks options and 25,000 shares of
Dr. Odinks restricted stock units would accelerate
upon involuntary termination and in connection with a change of
control. |
|
(7) |
|
22,500 shares of Ms. Kilfoils restricted stock
units would accelerate upon involuntary termination and in
connection with a change of control. |
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Since January 1, 2010, we have engaged in the following
transactions with our directors, executive officers, holders of
more than 5% of our voting securities, each of whom we refer to
as a Beneficial Owner, or any member of the immediate family of
any of the foregoing persons.
Private
Placements of Securities
2009
Equity Financing and 2010 Amendments
On September 25, 2009, we entered into a stock purchase
agreement, as amended to add an additional purchaser on
November 3, 2009, with certain existing holders of our
preferred stock for the sale of shares of our common stock equal
to $20.5 million divided by the price per share at which
shares of our common stock were sold to the public in our IPO,
minus any per-share underwriting discounts, commissions or fees.
We refer to this transaction as the 2009 equity financing.
Pursuant to the terms of the stock purchase agreement, the
investors deposited $20.5 million into an escrow account
for the purchase of the shares. On December 11, 2009, we
entered into a note purchase agreement and amended escrow
agreement with the investors to release $3.4 million of the
$20.5 million held in the escrow account and issued such
investors convertible promissory notes for the released amount,
which notes we refer to as the escrow notes and which are more
fully described below. The balance of the funds, or
$17.1 million, held in the escrow account would be released
simultaneously with the closing of an IPO in which the aggregate
net proceeds to us (after underwriting discounts, commissions
and fees) were at least $50.0 million. On February 24,
2010, we amended the stock purchase agreement and escrow
agreement with such holders to provide that the funds held in
the escrow account would be released simultaneously with the
closing of an IPO in which the aggregate net proceeds to us
(after underwriting discounts, commissions and fees) were at
least $20.0 million. The funds held in the escrow account
were released in connection with the closing of our IPO on
March 4, 2010.
29
The following table summarizes commitments made to participate
in the 2009 equity financing by any of our current directors,
executive officers, Beneficial Owners or any member of the
immediate family of any of the foregoing:
|
|
|
|
|
|
|
|
|
|
|
Aggregate
|
|
|
|
|
|
|
Consideration
|
|
|
Shares
|
|
|
|
to be Paid
|
|
|
Issued Upon
|
|
|
|
Upon Closing of
|
|
|
Release of
|
|
|
|
the 2009 Equity
|
|
|
Escrow
|
|
Name
|
|
Financing
|
|
|
Account(a)
|
|
|
VantagePoint Venture Partners IV, L.P. and affiliated entities,
or Vantage Point
|
|
$
|
7,586,035
|
(1)
|
|
|
1,152,891
|
|
Sofinnova Venture Partners VI, L.P. and affiliated entities, or
Sofinnova
|
|
$
|
4,898,784
|
|
|
|
744,496
|
|
A.M. Pappas Life Sciences Ventures III, L.P. and affiliated
entities, or Pappas
|
|
$
|
1,279,265
|
(2)
|
|
|
194,416
|
|
HBM BioCapital, L.P. and affiliated entities, or HBM BioCapital
|
|
$
|
1,417,958
|
(3)
|
|
|
215,495
|
|
|
|
|
|
|
|
|
|
|
TOTAL:
|
|
$
|
15,182,042
|
|
|
|
2,307,298
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
|
Numbers in this column calculated by dividing the
Aggregate Consideration to be Paid upon Closing of the
2009 Equity Financing by $6.58 (which equals the price per
share to the public in our initial public offering less the
underwriting discounts, commissions and fees). |
|
(1) |
|
Includes approximately $6,872,948 to be paid by VantagePoint
Ventures IV (Q), L.P., approximately $688,053 to be paid by
VantagePoint Venture Partners IV, L.P. and approximately $25,034
to be paid by VantagePoint Venture Partners IV Principals
Fund, L.P. |
|
(2) |
|
Includes approximately $1,204,428 to be paid by A.M. Pappas
Life Science Ventures III, L.P. and approximately $74,837 to be
paid by PV III CEO Fund, L.P. |
|
(3) |
|
Includes approximately $1,205,264 to be paid by HBM BioCapital
(EUR) L.P. and approximately $212,694 to be paid by HBM
BioCapital (USD) L.P. |
One additional purchaser, Shionogi & Co., Ltd., who is
not a current director, executive officer, Beneficial Owner or a
member of the immediate family of any of the foregoing, had also
committed $0.5 million to our 2009 equity financing,
and thus received 75,987 shares upon release of the escrow
account.
2009
Escrow Notes and 2010 Amendments
On December 11, 2009, we sold convertible promissory notes,
or the escrow notes, that were secured by a first priority
security interest in all of our assets to purchase shares of our
equity securities to certain of our existing investors for an
aggregate purchase price of $3.4 million. The escrow notes
accrued interest at a rate of 8% per annum and had a maturity
date of the earlier of (i) July 17, 2010 or
(ii) an event of default pursuant to the terms of the
escrow notes. The escrow notes were automatically convertible
into common stock upon the consummation of an IPO in which the
aggregate net proceeds to us (after underwriting discounts,
commissions and fees) were at least $50.0 million, at the
price per share in which shares were sold to the public, minus
any per-share underwriting discounts, commissions or fees.
However, if an IPO was not consummated by January 31, 2010,
the escrow notes became exchangeable for exchange notes in the
same principal amount plus any accrued interest thereon, which
would be automatically convertible into the securities that were
sold in our next equity financing at a 25% discount to the price
in which such securities were sold to other investors, or they
were alternatively convertible into shares of our
Series B-2
convertible preferred stock in connection with a change of
control of the Company. In addition, each exchange note that
would be issued would be accompanied by a warrant, which would
be exercisable for the security into which the accompanying
exchange note, if any, was converted, at the price at which that
security was sold to other investors. Depending on when the
exchange notes are converted, each warrant may be exercisable
for a number of shares equal to the quotient obtained by
dividing (x) (i) 25% of the principal amount of the
accompanying exchange notes, in the event the conversion
occurred prior to April 1, 2010, or (ii) 50% of the
principal amount of the accompanying exchange notes, in the
event the conversion occurred on or after April 1, 2010, by
(y) the
30
purchase price of the securities into which the exchange note
was ultimately converted. Furthermore, if a sale of all or
substantially all of our equity interests or assets occurred
prior to our next equity financing and any exchange note had not
converted, we were obligated to pay such exchange note holder an
amount equal to the accrued interest and two times the
outstanding principal amount on such note in conjunction with
the closing of such sale. On February 24, 2010, the note
holders waived their right to exchange the escrow notes for
exchange notes and warrants unless our IPO was not consummated
by March 31, 2010. In addition, on February 24, 2010,
we amended the note purchase agreement relating to the escrow
notes to provide that the escrow notes were automatically
convertible into common stock upon the consummation of an IPO in
which the aggregate net proceeds to us (after underwriting
discounts, commissions and fees) were at least
$20.0 million. The escrow notes automatically converted
into common stock upon the closing of our IPO on March 4,
2010, and thus no principal or interest payments were ever made
on the notes and no amounts remain due under such notes.
Moreover, because the escrow notes were not exchanged, no
warrants were ever issued in connection with such notes.
The following table summarizes the participation in the 2009
escrow notes by any of our current directors, executive
officers, Beneficial Owners or any member of the immediate
family of any of the foregoing persons:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
|
|
|
|
|
|
|
Issued Upon
|
|
|
|
Aggregate
|
|
|
Conversion of
|
|
|
|
Consideration
|
|
|
Escrow
|
|
Name
|
|
Paid
|
|
|
Account(a)
|
|
|
VantagePoint
|
|
$
|
1,553,766
|
(1)
|
|
|
240,222
|
|
Sofinnova
|
|
$
|
1,003,366
|
|
|
|
155,127
|
|
Pappas
|
|
$
|
262,018
|
(2)
|
|
|
40,509
|
|
HBM BioCapital
|
|
$
|
290,425
|
(3)
|
|
|
44,901
|
|
|
|
|
|
|
|
|
|
|
TOTAL:
|
|
$
|
3,109,575
|
|
|
|
480,759
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
|
Calculated by dividing (x) the sum of
(i) Aggregate Consideration to be Paid and
(ii) accrued interest by (y) $6.58 (which equals the
price per share to the public in our initial public offering
less the underwriting discounts, commissions and fees). |
|
|
|
(1) |
|
Consists of (i) a convertible promissory note with a
principal amount of $1,407,712 purchased by VantagePoint Venture
Partners IV (Q), L.P., (ii) a convertible promissory
note with a principal amount of $140,927 purchased by
VantagePoint Venture Partners IV, L.P. and (iii) a
convertible promissory note with a principal amount of $5,127
purchased by VantagePoint Venture Partners IV Principals
Fund, L.P. |
|
|
|
(2) |
|
Consists of (i) a convertible promissory note with a
principal amount of $246,690 purchased by A.M. Pappas Life
Science Ventures III, L.P. and (ii) a convertible
promissory note with a principal amount of $15,328 purchased by
PV III CEO Fund, L.P. |
|
(3) |
|
Consists of (i) a convertible promissory note with a
principal amount of $246,861 purchased by HBM BioCapital
(EUR) L.P. and (ii) a convertible promissory note with a
principal amount of $43,564 purchased by HBM BioCapital (USD)
L.P. |
September
2010 Private Placement
On September 20, 2010, we entered into a securities
purchase agreement with certain accredited investors pursuant to
which we sold, on September 24, 2010, an aggregate of
10,500,000 units, with each unit consisting of one share of
our common stock and a Warrant to purchase 0.40 shares of
our common stock. The purchase price per unit was $3.00. Piper
Jaffray & Co. served as our lead placement agent and
Wedbush PacGrow Life Sciences served as co-placement agent in
the private placement. Each Warrant is exercisable in whole or
in party at any time until September 24, 2015 at a per
share exercise price of $3.30, subject to certain adjustments as
specified in the Warrant.
31
The following table summarizes the participation in the private
placement by any of our current directors, executive officers,
Beneficial Owners or any member of the immediate family of any
of the foregoing persons:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares
|
|
|
|
|
|
|
|
|
|
of Common
|
|
|
|
|
|
|
Shares
|
|
|
Stock
|
|
|
|
Aggregate
|
|
|
of Common
|
|
|
Underlying
|
|
|
|
Consideration
|
|
|
Stock
|
|
|
Outstanding
|
|
Name
|
|
Paid
|
|
|
Issued
|
|
|
Warrants
|
|
|
HBM BioCapital(1)
|
|
$
|
999,999
|
|
|
|
333,333
|
|
|
|
133,333
|
|
Pappas(2)
|
|
$
|
1,400,001
|
|
|
|
466,667
|
|
|
|
186,667
|
|
Caduceus Private Investments IV, LP
|
|
$
|
10,000,002
|
|
|
|
3,333,334
|
|
|
|
1,333,334
|
|
Visium Balanced Master Fund, Ltd.
|
|
$
|
3,750,000
|
|
|
|
1,250,000
|
|
|
|
500,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL:
|
|
$
|
16,150,002
|
|
|
|
5,383,334
|
|
|
|
2,153,334
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Includes 283,333 shares of common stock and a Warrant to
purchase 113,333 shares of common stock issued to HBM
BioCapital (EUR), L.P. and 50,000 shares of common stock
and a warrant to purchase 20,000 shares of common stock
issued to HBM BioCapital (USD), L.P. |
|
(2) |
|
Includes 439,352 shares of common stock and a Warrant to
purchase 175,741 shares of common stock issued to
A.M. Pappas Life Science Ventures III, L.P. and
27,315 shares of common stock and a Warrant to purchase
10,926 shares of common stock issued to PV III CEO Fund,
L.P. |
Other
Related-Party Transaction
The spouse of Georgina Kilfoil, our Senior Vice President,
Product Development and Clinical Operations, is the Chief
Executive Officer of InClin, Inc., or InClin. Ms. Kilfoil
was a consultant for InClin until joining us in March 2010. We
use InClins clinical research organization services to
supplement the clinical research organization services we
receive from other providers. For the period from
September 9, 2004 (Date of Inception) to December 31,
2010, we paid Inclin $665,191 for the clinical research
organization services it provides to us.
Indemnification
Agreements
We have entered into indemnification agreements with each of our
directors and certain of our executive officers. As permitted by
the Delaware General Corporation Law, we have adopted provisions
in our amended and restated certificate of incorporation that
limit or eliminate the personal liability of our directors to us
for monetary damages for a breach of their fiduciary duty as a
director, except for liability for:
|
|
|
|
|
any breach of the directors duty of loyalty to us or our
stockholders;
|
|
|
|
any act or omission not in good faith or that involves
intentional misconduct or a knowing violation of law;
|
|
|
|
any unlawful payments related to dividends or unlawful stock
repurchases, redemptions or other distributions; or
|
|
|
|
any transaction from which the director derived an improper
personal benefit.
|
Pursuant to our amended and restated certificate of
incorporation and amended and restated bylaws, we are obligated,
to the maximum extent permitted by Delaware law, to indemnify
each of our directors and officers against expenses (including
attorneys fees), judgments, fines, settlements and other
amounts actually and reasonably incurred in connection with any
proceeding, arising by reason of the fact that such person is or
was an agent of the corporation. A director or
officer includes any person who is or was a director
or officer of us or as a director, partner, trustee, officer,
employee or agent of any other corporation, partnership, limited
liability company, joint venture, trust, employee benefit plan,
foundation, association, organization or other legal entity
which such person is or was serving at our request, but does not
include the status of a person who is serving or has served as a
director, officer, employee or agent of a constituent
corporation absorbed in a merger or consolidation transaction
with the Company with respect to such persons activities
prior to said transaction unless specifically authorized by our
board of directors or our stockholders. Pursuant to our amended
and restated bylaws, we also have
32
the power to indemnify our employees to the extent permitted
under Delaware law. Our amended and restated bylaws provide that
we shall advance expenses to directors in connection with any
proceeding in which such director is involved because of his or
her status as a director and we may, at the discretion of our
board of directors, advance expenses to officers and employees
in connection with any proceeding in which such officer or
employee is involved because of his or her status as such. Our
amended and restated bylaws permit us to purchase and maintain
insurance on behalf of any person who is or was a director,
officer, employee or agent of us or, at our request, served in
such a capacity for another enterprise.
We have entered into indemnification agreements with each of our
directors and certain of our executive officers that are, in
some cases, broader than the specific indemnification provisions
permitted by Delaware law, and that may provide additional
procedural protection. The indemnification agreements require
us, among other things, to:
|
|
|
|
|
indemnify officers and directors against certain liabilities
that may arise because of their status as officers or
directors; and
|
|
|
|
advance expenses, as incurred, to officers and directors in
connection with a legal proceeding, subject to limited
exceptions.
|
At present, there is no pending litigation or proceeding
involving any of our directors, officers or employees in which
indemnification is sought, nor are we aware of any threatened
litigation or proceeding that may result in claims for
indemnification.
Procedures
for Approval of Related Person Transactions
The Audit Committee shall conduct an appropriate review of all
related party transactions for potential conflict of interest
situations on an ongoing basis, and the approval of the Audit
Committee shall be required for all such transactions. The Audit
Committee may establish such policies and procedures as it deems
appropriate to facilitate such review.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information with respect to the
beneficial ownership of shares of our common stock by
(i) each director, (ii) each named executive officer,
(iii) all directors and executive officers as a group, and
(iv) each person who we know beneficially owns more than 5%
of our common stock as of January 31, 2011, unless
otherwise indicated below.
Beneficial ownership is determined in accordance with the rules
of the SEC. These rules generally attribute beneficial ownership
of securities to persons who possess sole or shared voting power
or investment power with respect to those securities and include
shares of common stock issuable upon the exercise of stock
options that are immediately exercisable or exercisable within
60 days after January 31, 2011, but excludes unvested
stock options, which contain an early exercise feature. Except
as otherwise indicated, all of the shares reflected in the table
are shares of common stock and all persons listed below have
sole voting and investment power with respect to the shares
beneficially owned by them, subject to applicable community
property laws. The information is not necessarily indicative of
beneficial ownership for any other purpose.
In computing the number of shares of common stock beneficially
owned by a person and the percentage ownership of that person,
we deemed outstanding shares of common stock subject to options
or warrants held by that person that are currently exercisable
or exercisable within 60 days of January 31, 2011. We
did not deem these shares outstanding, however, for the purpose
of computing the percentage ownership of any other person.
33
Percentage ownership calculations for beneficial ownership for
each person or entity are based on 32,906,412 shares
outstanding as of January 31, 2011. Except as otherwise
indicated in the table below, addresses of named beneficial
owners are in care of Anthera Pharmaceuticals, Inc., 25801
Industrial Blvd., Suite B, Hayward, California 94545.
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
Name of Beneficial Owner
|
|
Beneficially Owned
|
|
Percent of Class
|
|
5% or Greater Stockholders:
|
|
|
|
|
|
|
|
|
VantagePoint Venture Partners IV, L.P. and affiliated entities,
or VantagePoint(1)
|
|
|
6,472,646
|
|
|
|
19.56
|
%
|
Caduceus Private Investments IV, LP(2)
|
|
|
4,783,068
|
|
|
|
13.97
|
%
|
Sofinnova Venture Partners VI, L.P. and affiliated entities, or
Sofinnova(3)
|
|
|
4,177,621
|
|
|
|
12.65
|
%
|
FRM LLC(4)
|
|
|
2,926,000
|
|
|
|
8.89
|
%
|
Visium Balanced Master Fund, Ltd.(5)
|
|
|
2,599,197
|
|
|
|
7.78
|
%
|
Columbia Wanger Asset Management, LLC(6)
|
|
|
1,823,600
|
|
|
|
5.54
|
%
|
A.M. Pappas Life Science Ventures III, L.P. and affiliated
entities(7)
|
|
|
1,813,140
|
|
|
|
5.47
|
%
|
HBM BioCapital, L.P. and affiliated entities(8)
|
|
|
1,702,471
|
|
|
|
5.15
|
%
|
All 5% or greater stockholders as a group
|
|
|
26,297,743
|
|
|
|
74.27
|
%
|
Named Executive Officers and Directors:
|
|
|
|
|
|
|
|
|
Paul F. Truex(9)
|
|
|
1,133,302
|
|
|
|
3.40
|
%
|
Christopher P. Lowe(10)
|
|
|
161,648
|
|
|
|
*
|
|
Colin Hislop, M.D.(11)
|
|
|
179,676
|
|
|
|
*
|
|
Debra Odink, Ph.D.(12)
|
|
|
120,961
|
|
|
|
*
|
|
Georgina Kilfoil(13)
|
|
|
87,616
|
|
|
|
*
|
|
Christopher S. Henney, Ph.D.(14)
|
|
|
122,408
|
|
|
|
*
|
|
Annette Bianchi(15)
|
|
|
23,332
|
|
|
|
*
|
|
James I. Healy, M.D., Ph.D.(16)
|
|
|
4,211,175
|
|
|
|
12.75
|
%
|
Donald J. Santel(17)
|
|
|
24,244
|
|
|
|
*
|
|
Daniel K. Spiegelman(18)
|
|
|
14,250
|
|
|
|
*
|
|
David E. Thompson(19)
|
|
|
37,690
|
|
|
|
*
|
|
Peter A. Thompson
|
|
|
|
|
|
|
|
|
All named executive officers and directors as a group
(12 persons)
|
|
|
6,116,302
|
|
|
|
17.64
|
%
|
|
|
|
* |
|
Represents beneficial ownership of less than 1% of the shares of
common stock. |
|
(1) |
|
Includes (i) 5,695,228 shares of common stock and
147,861 shares of common stock issuable upon exercise of
warrants, all owned of record by VantagePoint Venture
Partners IV (Q), L.P., (ii) 570,147 shares of
common stock and 14,801 shares of common stock issuable
upon exercise of warrants, all owned of record by VantagePoint
Venture Partners IV, L.P., (iii) 20,739 shares of
common stock and 538 shares of common stock issuable upon
exercise of warrants, all owned of record by VantagePoint
Venture Partners IV Principals Fund, L.P., and
(iv) options to purchase an additional 23,332 shares
of common stock that are exercisable within 60 days of
January 31, 2011 that are owned of record by Annette
Bianchi, over which VantagePoint has sole voting and investment
power. Ms. Bianchi, a director of Anthera, is a Managing
Director at VantagePoint. Alan E. Salzman, through his authority
to cause the general partner of the limited partnerships that
directly hold such shares to act, may be deemed to have voting
and investment power with respect to such shares.
Mr. Salzman disclaims beneficial ownership with respect to
such shares except to the extent of his pecuniary interest
therein. The address for VantagePoint Venture Partners is 1001
Bayhill Drive, Suite 300, San Bruno, CA 94066. |
|
(2) |
|
Includes 3,449,734 shares of common stock and
1,333,334 shares of common stock issuable upon exercise of
warrants, all owned of record by Caduceus Private Investments,
LP. OrbiMed Advisors LLC, a registered investment adviser under
the Investment Advisers Act of 1940, as amended, is the sole
managing member of OrbiMed Capital GP IV LLC, which is the sole
general partner of Caduceus Private Investments IV, LP. Samuel
D. Isaly is the owner of a controlling interesting in OrbiMed
Advisors LLC. As such, OrbiMed |
34
|
|
|
|
|
Advisors LLC, OrbiMed Capital GP IV LLC and Mr. Isaly may
be deemed to have voting and investment power with respect to
such shares. The address for OrbiMed Advisors LLC is 767 Third
Avenue, 30th Floor, New York, New York 10017. |
|
(3) |
|
Includes: (i) 3,360,574 shares of common stock and
86,996 shares of common stock issuable upon exercise of
warrants all owned of record by Sofinnova Venture Partners VI,
L.P.; (ii) 665,820 shares of common stock and
17,237 shares of common stock issuable upon exercise of
warrants all owned of record by Sofinnova Venture Partners VI
GmbH & Co. KG; and (iii) 45,809 shares of
common stock and 1,185 shares of common stock issuable upon
the exercise of warrants all owned of record by Sofinnova
Venture Affiliates VI, L.P. Alain Azan, Eric Buatois, Michael
Powell and Dr. James I. Healy are the managing members of
the general partner of the limited partnerships, that directly
hold such shares, and as such, may be deemed to share voting and
investment power with respect to such shares. Dr. Healy is
a director of Anthera. Messrs. Azan, Buatois and Powell and
Dr. Healy disclaim beneficial ownership, except to the
extent of their proportionate pecuniary interest in Sofinnova.
The address for Sofinnova Ventures is 2800 Sand Hill Road,
Suite 150, Menlo Park, CA 94025. |
|
(4) |
|
Based on Schedule 13G filed on February 14, 2011 filed
on behalf of FMR LLC and Edward C. Johnson 3d, Chairman of FMR
LLC. Reported holdings consist of 2,926,000 shares of
common stock beneficially owned by Fidelity
Management & Research Company (Fidelity),
a wholly-owned subsidiary of FMR LLC. Edward C. Johnson 3d and
FMR LLC, through its control of Fidelity, and the funds each has
sole power to dispose of the 2,926,000 shares owned by the
funds. |
Members of the family of Edward C. Johnson 3d, Chairman of FMR
LLC, are the predominant owners, directly or through trusts, of
Series B voting common shares of FMR LLC, representing 49%
of the voting power of FMR LLC. The Johnson family group and all
other Series B shareholders have entered into a
shareholders voting agreement under which all
Series B voting common shares will be voted in accordance
with the majority vote of Series B voting common shares.
Accordingly, through their ownership of voting common shares and
the execution of the shareholders voting agreement,
members of the Johnson family may be deemed, under the
Investment Company Act of 1940, to form a controlling group with
respect to FMR LLC. Neither FMR LLC nor Edward C. Johnson 3d,
Chairman of FMR LLC, has the sole power to vote or direct the
voting of the shares owned directly by the Fidelity Funds, which
power resides with the Funds Boards of Trustees. Fidelity
carries out the voting of the shares under written guidelines
established by the Funds Boards of Trustees. The address
for Fidelity is 82 Devonshire Street, Boston, Massachusetts
02109.
|
|
|
(5) |
|
Based on Schedule 13G/A filed February 10, 2011 on
behalf of the following persons: Visium Balanced Master Fund,
LTD, a Cayman Islands corporation (VBMF),Visium
Asset Management, LP, a Delaware limited partnership
(VAM), JG Asset, LLC, a Delaware limited liability
company (JG Asset), and Jacob Gottlieb. Reported
holdings consist of 2,099,197 shares of common stock and
500,000 shares of commons stock issuable upon exercise of
warrants, all owned of record by VBMF. Jacob Gottlieb, Managing
Member of JG Asset, which is the General Partner of VAM, which
is the investment manager to pooled investment funds, may be
deemed to have voting and investment power with respect to such
shares. The address for Visium Balanced Master Fund, Ltd. is 950
Third Avenue, New York, NY 10022. |
|
(6) |
|
Based on Schedule 13G filed on February 10, 2011 on
behalf of Columbia Wanger Asset Management, LLC. |
|
(7) |
|
Based on Schedule 13G/A filed February 10, 2011 on
behalf of the following persons: A.M. Pappas Life Science
Ventures III, LP, a Delaware limited partnership (Pappas
Ventures III), PV III CEO Fund, LP, a Delaware limited
partnership (the CEO Fund), AMP&A Management
III, LLC, a Delaware limited liability company (AMP&A
Management), and Arthur M. Pappas
(Mr. Pappas). Reported holdings consist of
(i) 1,505,394 shares of common stock and
201,638 shares of common stock issuable upon exercise of
warrants, all owned of record by Pappas Ventures III and
(ii) 93,572 shares of common stock and
12,536 shares of common stock issuable upon exercise of
warrants, all owned of record by the CEO Fund. Mr. Pappas,
in his role as chairman of the investment committee of
AMP&A Management, the general partner of Pappas
Ventures III and CEO Fund, has voting and investment
authority over these shares. Mr. Pappas disclaims
beneficial ownership of these shares except to the extent of his
pecuniary interest arising therein. The address for both Pappas
Ventures III and CEO Fund is 2520 Meridian Parkway, Suite
400, Durham, NC 27713. |
35
|
|
|
(8) |
|
Based on Schedule 13G/A filed February 14, 2011 on
behalf of the following persons: HBM BioCapital (EUR) L.P., a
Cayman Islands limited partnership (BioCapital EUR),
HBM BioCapital (USD) L.P., a Cayman Islands limited partnership
( BioCapital USD) and HBM BioCapital Ltd., a Cayman
Islands limited company (BioCapital Ltd.). Reporting
holdings consist of (i) 1,307,840 shares of common
stock and 139,263 shares of common stock issuable upon
exercise of warrants, all owned of record by BioCapital (EUR)
and (ii) 230,793 shares of common stock and
24,575 shares of common stock issuable upon exercise of
warrants, all owned of record by BioCapital (USD), together with
Biocapital (EUR), the HBM BioCapital Funds. The board of
directors of BioCapital Ltd., the general partner of the HBM
BioCapital Funds, has sole voting and dispositive power with
respect to such shares. The board of directors of BioCapital
Ltd. consists of John Arnold, Sophia Harris, Richard Coles,
Dr. Andreas Wicki and John Urquhart, none of whom has
individual voting or investment power with respect to the
shares. The address for the HBM BioCapital Funds is
c/o HBM
BioCapital Ltd., Centennial Towers, 3rd Floor, 2454 West
Bay Road, Grand Cayman, Cayman Islands. |
|
(9) |
|
Includes 698,375 shares of common stock and options to
purchase an additional 434,927 shares of common stock that
are exercisable within 60 days of January 31, 2011,
owned of record by Paul F. Truex. |
|
(10) |
|
Includes (i) 9,637 shares of common stock owned of
recorded by Dina Gonzalez, Mr. Lowes spouse,
(ii) 27,645 shares of common stock and
(iii) options to purchase 124,366 shares of common
stock that are exercisable within 60 days of
January 31, 2011, owned of record by Mr. Lowe. On
February 11, 2011, Mr. Lowe transferred his position
as manager of BioVest III for no consideration and
transferred 80,997 shares of common stock owned of record
by BioVest III. The address for BioVest III is 25801
Industrial Blvd., Suite B, Hayward, CA 94545. |
|
(11) |
|
Includes (i) 20,851 shares of common stock,
(ii) 3,894 shares received by Dr. Hislop on
February 11, 2011 in a pro rata distribution to the
partners in Biovest III for no additional consideration,
and (iii) options to purchase an additional
154,931 shares of common stock that are exercisable within
60 days of January 31, 2011, owned of record by
Dr. Hislop. |
|
(12) |
|
Includes 96,928 shares of common stock and options to
purchase an additional 24,033 shares of common stock that
are exercisable within 60 days of January 31, 2011,
all owned of record by the Debra A. Odink Living Trust, for
which Dr. Odink serves as trustee. |
|
(13) |
|
Includes 87,616 shares of common stock held by certain
family members and for which Ms. Kilfoil is the beneficial
owner. |
|
(14) |
|
Includes 112,408 shares of common stock, 9,979 shares
of which are subject to the Companys right of repurchase
and options to purchase an additional 10,000 shares of
common stock that are exercisable within 60 days of
January 31, 2011, owned of record by Dr. Henney. |
|
(15) |
|
Includes options to purchase 23,332 shares of common stock
that are exercisable within 60 days of January 31,
2011, owned of record by Ms. Bianchi. VantagePoint has sole
voting and investment power with respect to these shares, and
Ms. Bianchi disclaims beneficial ownership thereof except
to the extent of her pecuniary interest in the shares of common
stock issuable upon exercise of the option. |
|
(16) |
|
Includes 20,443 shares of common stock owned of record by
Dr. Healy, 5,111 shares of which are subject to the
Companys right of repurchase and options to purchase an
additional 8,000 shares of common stock that are
exercisable within 60 days of January 31, 2011, owned
of record by Dr. Healy. |
|
(17) |
|
Includes options to purchase 24,244 shares of common stock
that are exercisable within 60 days of January 31,
2011, owned of record by the Donald J. Santel and Kelly L.
McGinnis Revocable Living Trust. |
|
(18) |
|
Includes options to purchase 14,250 shares of common stock
that are exercisable within 60 days of January 31,
2011, owned of record by Mr. Spiegelman. |
|
(19) |
|
Includes 28,594 shares of common stock and options to
purchase an additional 9,096 shares of common stock that
are exercisable within 60 days of January 31, 2011,
owned of record by Mr. Thompson. |
36
SECTION 16(a)
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires our officers and
directors, and persons who own more than 10% of a registered
class of our equity securities, to file reports of ownership and
changes in ownership (Forms 3, 4 and 5) with the SEC.
Officers, directors and greater than 10% stockholders are
required to furnish us with copies of all such forms which they
file.
To our knowledge, based solely on our review of such reports or
written representations from certain reporting persons, we
believe that all of the filing requirements applicable to our
officers, directors, greater than 10% beneficial owners and
other persons subject to Section 16 of the Exchange Act
were complied with during the year ended December 31, 2010.
The following Compensation Committee Report and Audit
Committee Report are not considered proxy solicitation materials
and are not deemed filed with the Securities and Exchange
Commission. Notwithstanding anything to the contrary set forth
in any of the Companys filings made under the Securities
Act of 1933 or the Exchange Act that might incorporate filings
made by the Company under those statutes, the Compensation
Committee Report and Audit Committee Report shall not be
incorporated by reference into any prior filings or into any
future filings made by the Company under those statutes.
COMPENSATION
COMMITTEE REPORT
The Compensation Committee of the Board of Directors (the
Compensation Committee) has furnished this report on
executive compensation. None of the members of the Compensation
Committee is currently an officer or employee of the Company and
all are non-employee directors for purposes of
Rule 16b-3
under the Exchange Act and outside directors for
purposes of Section 162(m) of the Internal Revenue Code.
The Compensation Committee is responsible for designing,
recommending to the Board of Directors for approval and
evaluating the compensation plans, policies and programs of the
Company and reviewing and approving the compensation of the
Chief Executive Officer and other officers and directors.
This report, filed in accordance with Item 407(e)(5) of
Regulation S-K,
should be read in conjunction with the other information
relating to executive compensation which is contained elsewhere
in this proxy statement and is not repeated here.
In this context, the Compensation Committee hereby reports as
follows:
1. The Compensation Committee has reviewed and discussed
the Compensation Discussion and Analysis section contained
herein with management.
2. Based on the review and discussions referred to in
paragraph (1) above, the Compensation Committee recommended
to the Board of Directors, and the Board of Directors has
approved, that the Compensation Discussion and Analysis be
included in this proxy statement on Schedule 14A for filing
with the SEC.
COMPENSATION COMMITTEE
David E. Thompson,
Chairman
Donald J. Santel
Peter A.
Thompson, M.D.
37
AUDIT
COMMITTEE REPORT
The Audit Committee of the Board of Directors (the Audit
Committee) has furnished this report concerning the
independent audit of the Companys financial statements.
Each member of the Audit Committee meets the enhanced
independence standards established by the Sarbanes-Oxley Act of
2002 and rulemaking of the Securities and Exchange Commission
(the SEC) and the NASDAQ Stock Market regulations. A
copy of the Audit Committee Charter is available on the
Companys website at
http://www.anthera.com.
The Audit Committees responsibilities include assisting
the Board of Directors regarding the oversight of the integrity
of the Companys financial statements, the Companys
compliance with legal and regulatory requirements, the
independent registered public accounting firms
qualifications and independence, and the performance of the
Companys internal audit function and the independent
registered public accounting firm.
In fulfilling its oversight responsibilities, the Audit
Committee reviewed and discussed the Companys financial
statements for the fiscal year ended December 31, 2010 with
the Companys management and Deloitte & Touche
LLP, the Companys independent registered public accounting
firm. In addition, the Audit Committee has discussed with
Deloitte & Touche LLP, with and without management
present, their evaluation of the Companys internal
accounting controls and overall quality of the Companys
financial reporting. The Audit Committee also discussed with
Deloitte & Touche LLP the matters required to be
discussed by statement on Auditing Standards No. 114
(formerly SAS 61), as amended (AICPA, Professional
Standards, Vol. 1 AU section 380), as adopted by the
Public Company Accounting Oversight Board in Rule 3200T.
The Audit Committee also received the written disclosures and
the letter from Deloitte & Touche LLP required by the
Public Company Accounting Oversight Board Rule 3526 and the
Audit Committee discussed the independence of
Deloitte & Touche LLP with that firm.
Based on the Audit Committees review and discussions noted
above, the Audit Committee recommended to the Board of
Directors, and the Board of Directors approved, that the audited
financial statements be included in the Companys Annual
Report for the fiscal year ended December 31, 2010.
The Audit Committee and the Board of Directors have recommended
the selection of Deloitte & Touche LLP as the
Companys independent registered public accounting firm for
the year ending December 31, 2011.
AUDIT COMMITTEE
Daniel K. Spiegelman,
Chairman
Donald J. Santel
Peter A.
Thompson, M.D.
38
HOUSEHOLDING
OF PROXY MATERIALS
We have adopted a procedure approved by the SEC known as
householding. This procedure allows multiple
stockholders residing at the same address the convenience of
receiving a single copy of our Notice, annual report on
Form 10-K
and proxy materials, as applicable. This allows us to save money
by reducing the number of documents we must print and mail, and
helps protect the environment as well.
Householding is available to both registered stockholders (i.e.,
those stockholders with certificates registered in their name)
and streetname holders (i.e., those stockholders who hold their
shares through a brokerage).
Registered
Stockholders
If you are a registered stockholder and have consented to our
mailing of proxy materials and other stockholder information
only to one account in your household, as identified by you, we
will deliver or mail a single copy of our annual report and
proxy materials for all registered stockholders residing at the
same address. Your consent will be perpetual unless you revoke
it, which you may do at any time by contacting the Householding
Department of Broadridge Financial Solutions, Inc., at 51
Mercedes Way, Edgewood, NY 11717, or by calling
1-800-542-1061.
If you revoke your consent, we will begin sending you individual
copies of future mailings of these documents within 30 days
after we receive your revocation notice. If you received a
householded mailing this year, and you would like to receive
additional copies of our annual report and proxy materials,
please submit your request to Investor Relations who will
promptly deliver the requested copy.
Registered stockholders who have not consented to householding
will continue to receive copies of annual reports and proxy
materials for each registered stockholder residing at the same
address. As a registered stockholder, you may elect to
participate in householding and receive only a single copy of
annual reports or proxy statements for all registered
stockholders residing at the same address by contacting
Broadridge as outlined above.
Streetname
Holders
Stockholders who hold their shares through a brokerage may elect
to participate in householding or revoke their consent to
participate in householding by contacting their respective
brokers.
OTHER
MATTERS
We are not aware of any matters that may come before the meeting
other than those referred to in the Notice of Annual Meeting of
Stockholders. If any other matter shall properly come before the
Annual Meeting, however, the persons named in the accompanying
proxy intend to vote all proxies in accordance with their best
judgment.
Accompanying this proxy statement is our Annual Report for the
fiscal year ended December 31, 2010. Copies of our Annual
Report for the fiscal year ended December 31, 2010 are
available free of charge on our website at www.anthera.com or
you can request a copy free of charge by calling Investor
Relations at
510-856-5600
or sending an
e-mail
request to Investor Relations by accessing our website
(www.anthera.com), selecting the Investors tab and
then selecting Investor Contact. Please include your
contact information with the request.
By Order of the Board of Directors
Anthera Pharmaceuticals, Inc.
Sincerely,
Bradley A. Bugdanowitz
Secretary
Hayward, California
March 16, 2011
39
ANTHERA PHARMACEUTICALS, INC.
ATTN: MAY LIU
25801 INDUSTRIAL BLVD.
SUITE B
HAYWARD, CA 94545
VOTE BY INTERNET - www.proxyvote.com
Use the Internet to transmit your voting instructions
and for electronic delivery of information up until
11:59 P.M. Eastern Time the day before the meeting
date. Have your proxy card in hand when you access the
web site and follow the instructions to obtain your
records and to create an electronic voting instruction
form.
Electronic Delivery of Future PROXY MATERIALS
If you would like to reduce the costs incurred by our
company in mailing proxy materials, you can consent to
receiving all future proxy statements, proxy cards and
annual reports electronically via e-mail or the
Internet. To sign up for electronic delivery, please
follow the instructions above to vote using the Internet
and, when prompted, indicate that you agree to receive
or access proxy materials electronically in future
years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting
instructions up until 11:59 P.M. Eastern Time the day
before the meeting date. Have your proxy card in hand
when you call and then follow the instructions.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the
postage-paid envelope we have provided or return it to
Vote Processing, c/o Broadridge, 51 Mercedes Way,
Edgewood, NY 11717.
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TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: |
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KEEP THIS PORTION FOR YOUR RECORDS |
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DETACH AND RETURN THIS PORTION ONLY |
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. |
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For
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Withhold
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For All
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To withhold authority to vote for any individual nominee(s), mark For All Except and write the number(s) of the nominee(s) on the line below. |
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All
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All
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Except
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The Board of Directors recommends you vote |
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FOR the following: |
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1.
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Election of Directors |
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Nominees |
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01
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James I Healy, MD, PhD 02 Peter A. Thompson, M.D. |
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The Board of Directors recommends you vote FOR proposal 2: |
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To ratify the appointment of Deloitte & Touche, LLP as the independent registered public accounting firm of the Company for
its fiscal year ending December 31, 2011. |
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For address change/comments, mark here.
(see reverse for instructions) |
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Please sign exactly as your name(s) appear(s) hereon. When
signing as attorney, executor, administrator, or other
fiduciary, please give full title as such. Joint owners should
each sign personally. All holders must sign. If a corporation
or partnership, please sign in full corporate or partnership
name, by authorized officer. |
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Signature [PLEASE SIGN WITHIN BOX]
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Date
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Signature (Joint Owners)
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Date |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The
Notice & Proxy Statement, Annual Report is/are available at www.proxyvote.com.
ANTHERA PHARMACEUTICALS, INC.
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Paul F. Truex and Christopher P. Lowe proxies, and hereby
authorizes each of them to represent and vote as designated on the other side (each with the power
to act without the other and with the power of substitution), all the shares of stock of Anthera
Pharmaceuticals, Inc. (the Company) standing in the name of the undersigned with all powers which
the undersigned would possess if present at the Annual Meeting of Stockholders of the Company to be
held on April 19, 2011 or any adjournment or postponement thereof.
This proxy, when properly executed, will be voted in the manner you direct. If no direction is
made, your proxy will be voted FOR the proposals described in the enclosed proxy statement and in
the discretion of the proxy holders on all other matters that may come before the meeting.
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Address change / comments: |
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(If you noted any Address Changes and / or Comments above, please mark corresponding box on the reverse side.)
(Continued, and to be marked, dated and signed, on the other side)