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 (AMENDMENT NO.)
Filed by the Registrant ☒
Filed by a Party other than the Registrant ☐
Check the appropriate box:
| ☐ | Preliminary Proxy Statement |
| ☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
| ☒ | Definitive Proxy Statement |
| ☐ | Definitive Additional Materials |
| ☐ | Soliciting Material under 240.14a-12 |
ARCTURUS THERAPEUTICS HOLDINGS INC.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
| ☒ | No fee required. |
| ☐ | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
| 1) |
Title of each class of securities to which transaction applies: |
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Aggregate number of securities to which transaction applies: |
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| 3) |
Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11
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| ☐ | Fee paid previously with preliminary materials. |
| ☐ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| 1) |
Amount Previously Paid: |
| 2) |
Form, Schedule or Registration Statement No.: |
| 3) |
Filing Party: |
| 4) |
Date Filed: |
10628 Science Center Drive, Suite 250,
San Diego, California 92121
To our Stockholders:
We are pleased to invite you to attend the 2025 annual meeting of stockholders (the Annual Meeting) of Arcturus Therapeutics Holdings Inc. (the Company or Arcturus), to be held on June 6, 2025 at 9:00 a.m. Pacific Time, at https://www.cstproxy.com/arcturusrx/2025. The Annual Meeting will be a completely virtual meeting of stockholders, which will be conducted exclusively on the internet. No physical meeting will be held.
Details regarding how to attend the entirely virtual Annual Meeting and the business to be conducted at the Annual Meeting are more fully described in the accompanying notice of annual meeting of stockholders and proxy statement.
Your vote is important. Regardless of whether you plan to attend the virtual Annual Meeting, it is important that your shares be represented and voted at the Annual Meeting, and we hope you will vote as soon as possible. You may vote by proxy over the Internet or by mail by following the instructions on the proxy card or voting instruction card. Voting over the Internet, written proxy or voting instruction card will ensure your representation at the Annual Meeting regardless of whether you attend the Annual Meeting.
Thank you for your ongoing support of, and continued interest in, Arcturus.
Sincerely,
| /s/ Dr. Peter Farrell | /s/ Joseph E. Payne |
|
Dr. Peter Farrell Chairman of the Board |
Joseph E. Payne President and Chief Executive Officer |
San Diego, California
April 25, 2025
ARCTURUS THERAPEUTICS HOLDINGS INC.
10628 Science Center Drive, Suite 250,
San Diego, California 92121
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
| Time and Date | 9:00 a.m. Pacific Time, on June 6, 2025. | |
| Place | Virtually via the Internet at https://www.cstproxy.com/arcturusrx/2025. No physical meeting will be held. | |
| Items of Business |
(1) To elect Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet, Dr. Jing L. Marantz, Dr. John Markels, and Dr. Moncef Slaoui to the Board of Directors (the Board), to serve until our next annual meeting of stockholders. (2) To approve, on a non-binding advisory basis, the resolution approving named executive officer compensation. (3) To ratify the appointment of Deloitte Touche LLP (Deloitte), as our independent registered public accounting firm for the fiscal year ending December 31, 2025. (4) To transact other business that may properly come before the annual meeting. |
| Adjournments and Postponements | Any action on the items of business described above may be considered at the annual meeting at the time and on the date specified above or at any time and date to which the annual meeting may be properly adjourned or postponed. | |
| Record Date | April 14, 2025. Only stockholders of record of our common stock as of April 14, 2025 are entitled to notice of and to vote at the annual meeting. | |
| Meeting Admission | You are invited to virtually attend the annual meeting if you are a stockholder of record or a beneficial owner of shares of our common stock, in each case, as of April 14, 2025. You may attend the Annual Meeting and vote during the Annual Meeting by visiting https://www.cstproxy.com/arcturusrx/2025 and using your control number to enter the virtual Annual Meeting. If you are not a stockholder of record but hold shares as a beneficial owner in street name, you may be required to provide proof of beneficial ownership. | |
| Voting |
Your vote is very important. You may vote by proxy over the Internet or by mail by following the instructions on the proxy card or voting instruction card. For specific instructions on how to vote your shares, please refer to the section entitled Questions and Answers About the Proxy Materials and Annual Meeting in the accompanying proxy statement. |
By order of the Board of Directors,
/s/ Dr. Peter Farrell
Dr. Peter Farrell
Chairman of the Board
San Diego, California
April 25, 2025
TABLE OF CONTENTS
Page
| QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND ANNUAL MEETING | 1 |
| Board of directors and corporate governance | 7 |
| Proposal number 1. election of directors | 17 |
| PROPOSAL NUMBER 2. TO APPROVE BY NON-BINDING ADVISORY VOTE, THE RESOLUTION APPROVING THE COMPANYS NAMED EXECUTIVE OFFICER COMPENSATION | 18 |
| proposal number 3. ratification of appointment of independent registered public accounting firm | 19 |
| report of the audit committee | 22 |
| executive officers | 23 |
| executive compensation | 24 |
| related party transactions | 48 |
| security ownership | 49 |
| other matters | 52 |
| proposals of stockholders for 2026 annual meeting | 53 |
ARCTURUS
THERAPEUTICS HOLDINGS INC. PROXY STATEMENT
The information provided in the Questions
and Answers format below is for your convenience only and is merely a summary of the information contained in this proxy statement.
You should read the entire proxy statement carefully. In this proxy statement, we refer to Arcturus Therapeutics Holdings Inc., a Delaware
corporation, as Arcturus, the Company, we, us, our and other similar pronouns.
QUESTIONS AND ANSWERS
Why am I receiving these materials?
This proxy statement and the enclosed form of
proxy are furnished in connection with the solicitation of proxies by our Board for use at the 2025 annual meeting of stockholders of
Arcturus Therapeutics Holdings Inc., a Delaware corporation, and any postponements or adjournments thereof.
The annual meeting will be held on June 6, 2025
at 9:00 a.m. Pacific Time, at https://www.cstproxy.com/arcturusrx/2025. The Annual Meeting will be a completely virtual meeting of stockholders.
Stockholders are invited to attend the virtual
annual meeting and are requested to vote on the items of business described in this proxy statement. The proxy statement is being mailed
on or about April 28, 2025 to all stockholders entitled to vote at the annual meeting.
Who may vote at the annual meeting?
Only stockholders of record as
of the close of business on April 14, 2025, the record date, are entitled to vote at the annual meeting. As of the record date, there
were 27,120,603 shares of our common stock issued and outstanding, held by nine holders of record. We do not have cumulative voting rights
for the election of directors.
Stockholder of Record: Shares Registered in
Your Name
. If, at the close of business on the record date for the annual meeting, your shares were registered directly in your name
with our transfer agent, Continental Stock Transfer Trust Company (Continental), then you are a stockholder of record.
As a stockholder of record, you have the right to grant your voting proxy directly to the individuals listed on the proxy card or to vote
online, by mail, or in person at the annual meeting.
Beneficial Owner: Shares Registered in the
Name of a Broker, Bank, or Other Nominee
. If, at the close of business on the record date for the annual meeting, your shares were
held, not in your name, but rather in an account at a brokerage firm, bank, or other nominee, then you are the beneficial owner of shares
held in street name and these proxy materials are being forwarded to you by that organization. The organization holding
your account is considered the stockholder of record for purposes of voting at the annual meeting. As a beneficial owner, you have the
right to direct your broker, bank or other nominee regarding how to vote the shares in your account by following the voting instructions
your broker, bank or other nominee provides. You are also invited to attend the annual meeting. However, since you are not the stockholder
of record, you may not vote your shares in person at the annual meeting unless you obtain a valid proxy from your broker, bank or other
nominee.
How do I gain admission to the virtual annual
meeting or vote my shares at the virtual annual meeting?
You are entitled to attend the virtual Annual Meeting only if you were
a stockholder of record as of the record date for the Annual Meeting, which was April 14, 2025, or you hold a valid proxy for the Annual
Meeting.
1
Registered Stockholders
If your shares are registered in your name with Arcturus transfer
agent and you wish to attend the online-only virtual meeting, go to https://www.cstproxy.com/arcturusrx/2025, enter the control number
you received on your proxy card or notice of the meeting and click on the Click here to preregister for the online meeting
link at the top of the page. Just prior to the start of the meeting you will need to log back into the meeting site using your control
number. Pre-registration is recommended but is not required in order to attend.
Beneficial Owner: Shares Registered in the Name of a Broker, Bank
or Other Nominee
Beneficial stockholders who wish to attend the online-only virtual
meeting must obtain a legal proxy by contacting their account representative at the bank, broker, or other nominee that holds their shares
and e-mail a copy (a legible photograph is sufficient) of their legal proxy to our transfer agent, Continental Stock Transfer (Continental),
proxy@continentalstock.com. Beneficial stockholders who e-mail a valid legal proxy will be issued a meeting control number that will allow
them to register to attend and participate in the online-only meeting. After contacting Continental, a beneficial holder will receive
an e-mail prior to the meeting with a link and instructions for entering the virtual meeting. Beneficial stockholders should contact Continental
at least five business days prior to the meeting date.
How do I ask questions at the virtual Annual Meeting?
Stockholders have multiple opportunities to submit questions to the
Company for the virtual Annual Meeting. Stockholders who wish to submit a question in advance may do so at https://www.cstproxy.com/arcturusrx/2025.
Stockholders may also submit questions online during the meeting at https://www.cstproxy.com/arcturusrx/2025. Given time constraints,
some questions may not be addressed during the virtual Annual Meeting.
How can I vote my shares?
Stockholder of Record: Shares Registered in Your Name
If you are a stockholder of record, you may vote in one of the following
ways:
If you are a beneficial owner of shares held of record by a broker,
bank or other nominee, you will receive voting instructions from your broker, bank or other nominee. You must follow the voting instructions
provided by your broker, bank or other nominee in order to instruct your broker, bank or other nominee on how to vote your shares.
What am I voting on?
You are being asked to vote on three proposals:
2
What if other matters are properly brought before the annual meeting?
As of the date of this proxy statement, we are
not aware of any other matters that will be presented for consideration at the annual meeting. If any other matters are properly brought
before the annual meeting, the persons named as proxies will be authorized to vote or otherwise act on those matters in accordance with
their judgment. If for any reason any of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda
Marquet, Dr. Jing L. Marantz, Dr. John Markels, or Dr. Moncef Slaoui is not available as a candidate for director, the persons named as
proxy holders will vote your proxy for such other candidate as may be nominated by our Board.
How does the Board recommend that I vote?
Our Board recommends that you vote your shares:
Can I change my vote or revoke my proxy?
Stockholder of Record: Shares Registered in Your Name.
If you are a stockholder of record, you can
change your vote or revoke your proxy at any time before the annual meeting by:
Beneficial Owner: Shares Registered in the
Name of a Broker, Bank or Other Nominee
. If you are the beneficial owner of your shares, you must contact the broker, bank or other
nominee holding your shares and follow their instructions to change your vote or revoke your proxy.
What is the effect of giving a proxy?
Proxies are solicited by, and on behalf of,
our Board. Joseph E. Payne, our President and Chief Executive Officer, and Andy Sassine, our Chief Financial Officer, have been designated
as proxies for the annual meeting by our Board. When proxies are properly dated, executed and returned, the shares represented by such
proxies will be voted at the annual meeting in accordance with the instruction of the stockholder. If no specific instructions are given,
however, the shares will be voted in accordance with the recommendations of our Board as described above and, if any other matters are
properly brought before the annual meeting, the shares will be voted in accordance with the proxies judgment.
How many votes do I have?
On each matter to be voted upon at the annual
meeting, each stockholder will be entitled to one vote for each share of our common stock held by them on the record date.
3
What is the quorum requirement for the annual meeting?
A quorum is the minimum number of shares required to be present or
represented at the annual meeting for the meeting to be properly held under our bylaws and Delaware law. Holders of at least 33.33% of
the voting power of our outstanding common stock entitled to vote at the annual meeting must be present in person (including virtually)
or represented by proxy for us to hold and transact business at the annual meeting. On the record date, there were 27,120,603 shares outstanding
and entitled to vote. Thus, the holders of at least 9,040,201 shares must be present in person (including virtually) or represented by
proxy at the annual meeting to have a quorum.
Abstentions, WITHHOLD votes, and
broker non-votes (as explained below) are counted as present and entitled to vote for purposes of determining a quorum.
If there is no quorum, the meeting may be adjourned to another date by the chairman of the meeting or the holders of a majority of the
voting power present in person (including virtually) or represented by proxy at the annual meeting and entitled to vote.
What are broker non-votes?
Broker non-votes occur when a beneficial owner
of shares held in street name does not give instructions to the broker holding the shares as to how to vote on matters deemed
non-routine and there is at least one routine matter to be voted upon at the meeting. Generally, if shares
are held in street name, the beneficial owner of the shares is entitled to give voting instructions to the broker holding the shares.
If the beneficial owner does not provide voting instructions, the broker can still vote the shares with respect to matters that are considered
to be routine, but not with respect to non-routine, matters. In the event that a broker votes shares on the
routine matters, but does not vote shares on the non-routine matters, those shares will be treated as broker
non-votes with respect to the non-routine proposals. Accordingly, if you own shares through a nominee, such as a broker
or bank, please be sure to instruct your nominee how to vote to ensure that your vote is counted on each of the proposals.
What matters are considered routine and non-routine?
The ratification of the appointment of Deloitte
as our independent registered public accounting firm for our fiscal year ending December 31, 2025 (Proposal No. 3) is considered routine
under the rules of the Nasdaq Stock Market LLC (Nasdaq). All other proposals are considered non-routine under
applicable federal securities rules and the rules of The Nasdaq Stock Market LLC.
What are the effects of abstentions and broker non-votes?
Abstentions (i.e. shares present at the annual meeting and marked
abstain) are deemed to be shares presented or represented by proxy and entitled to vote, and are counted for purposes of
determining whether a quorum is present. However, abstentions are not counted as a vote either for or against a proposal, and have no
effect on the outcome of the matters voted upon.
A broker non-vote occurs when the beneficial owner of shares fails
to provide the broker, bank or other nominee that holds the shares with specific instructions on how to vote on any non-routine
matters brought to a vote at the annual meeting. In this situation, the broker, bank or other nominee will not vote on the non-routine
matter. Broker non-votes are counted for purposes of determining whether a quorum is present and have no effect on the outcome of the
matters voted upon.
Note that if you are a beneficial holder, brokers
and other nominees will be entitled to vote your shares on routine matters without instructions from you. The only proposal
that would be considered routine in such event is the proposal for the ratification of the appointment of Deloitte as our
independent registered public accounting firm for the fiscal year ending December 31, 2025 (Proposal No. 3). A broker or other nominee
will not be entitled to vote your shares on any non-routine matters, absent instructions from you. Non-routine
matters include all proposals other than Proposal No. 4, including the election of directors. Accordingly, we encourage you to provide
voting instructions to your broker or other nominee whether or not you plan to attend the meeting.
4
What is the voting requirement to approve each of the proposals?
Proposal No. 1: Election of Directors.
The election of each of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet, Dr. Jing
L. Marantz, Dr. John H. Markels, and Dr. Moncef Slaoui to the Board requires a plurality of the votes cast by the holders of shares present
in person or represented by proxy at the annual meeting and entitled to vote on the election of a director. This means that if each of
the nominees receives one or more votes, he or she will be elected as a director. You may vote FOR or WITHHOLD
for each of the nominees. Because the outcome of this proposal will be determined by a plurality vote, shares voted WITHHOLD
will not generally prevent each of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet,
Dr. Jing L. Marantz, Dr. John H. Markels, and Dr. Moncef Slaoui from being elected as a director. Shares voted WITHHOLD
will count towards the quorum requirement for the annual meeting.
Proposal No. 2
:
Say on Pay
. The
approval, on an advisory basis, of the Say on Pay Proposal requires the affirmative vote of a majority of the votes cast on the proposal
at the annual meeting. You may vote FOR, AGAINST, or ABSTAIN on this proposal. Abstentions will
count towards the quorum requirement for the annual meeting but will not count as a vote for or against the proposal.
Proposal No. 3: Ratification of Appointment
of Deloitte.
The ratification of the appointment of Deloitte requires the affirmative vote of a majority of the votes cast on the
proposal at the annual meeting. You may vote FOR, AGAINST, or ABSTAIN on this proposal. Abstentions
will count towards the quorum requirement for the annual meeting but will not count as a vote for or against the proposal.
Who will count the votes?
A representative of Continental will tabulate
the votes and may act as inspector of elections.
What if I do not specify how my shares are to be voted or fail
to provide timely directions to my broker, bank or other nominee?
Stockholder of Record: Shares Registered
in Your Name
. If you are a stockholder of record and you submit a proxy but you do not provide voting instructions, your shares will
be voted:
In addition, if any other matters are properly
brought before the annual meeting, the persons named as proxies will be authorized to vote or otherwise act on those matters in accordance
with their judgment.
Beneficial Owner: Shares Registered in the
Name of a Broker, Bank or Other Nominee
. Brokers, banks and other nominees holding shares of common stock in street name for customers
are generally required to vote such shares in the manner directed by their customers. In the absence of timely directions, your broker,
bank or other nominee will have discretion to vote your shares on our sole routine matter - Proposal No. 3 relating to ratifying
the appointment of Deloitte. Absent direction from you, however, your broker, bank or other nominee will
not
have the discretion
to vote on Proposal No. 1 or 2.
How can I contact Arcturus transfer
agent?
You may contact our transfer agent by writing
Continental Stock Transfer Trust Company, 1 State Street, 30
th
Floor, New York, NY 10014. You may also contact our transfer
agent via email at cstmail@continentalstock.com or by telephone at (212) 509-4000.
5
How are proxies solicited for the annual meeting, and who is paying
for such solicitation?
Our Board is soliciting proxies for use at the
annual meeting by means of the proxy materials. We will bear the entire cost of proxy solicitation, including the preparation, assembly,
printing, mailing and distribution of the proxy materials. Copies of solicitation materials will also be made available upon request to
brokers, banks and other nominees to forward to the beneficial owners of the shares held of record by such brokers, banks or other nominees.
The original solicitation of proxies may be supplemented by solicitation by telephone, electronic communication, or other means by our
directors, officers or employees. No additional compensation will be paid to these individuals for any such services, although we may
reimburse such individuals for their reasonable out-of-pocket expenses in connection with such solicitation. We do not plan to retain
a proxy solicitor to assist in the solicitation of proxies, although we may engage a proxy solicitor in the future.
If you choose to access the proxy materials
and/or vote over the Internet, or attend the annual meeting virtually, you are responsible for any Internet access charges you may incur.
Where can I find the voting results of the annual meeting?
We will announce preliminary voting results
at the annual meeting. We will also disclose voting results on a Current Report on Form 8-K filed with the Securities and Exchange Commission
(SEC), within four business days after the annual meeting. If final voting results are not available to us in time to file
a Current Report on Form 8-K within four business days after the annual meeting, we will file a Current Report on Form 8-K to publish
preliminary results and, within four business days after final results are known, file an additional Current Report on Form 8-K to publish
the final results.
What does it mean if I receive more than one set of printed materials?
If you receive more than one set of printed
materials, your shares may be registered in more than one name and/or are registered in different accounts. Please follow the voting instructions
on each set of printed materials to ensure that all of your shares are voted.
I share an address with another stockholder, and we received only
one printed copy of the proxy materials. How may I obtain an additional copy of the proxy materials?
We have adopted an SEC-approved procedure called
householding, under which we can deliver a single copy of the proxy materials and annual report to multiple stockholders
who share the same address unless we receive contrary instructions from one or more of the stockholders. This procedure reduces our printing
and mailing costs. Stockholders who participate in householding will continue to be able to access and receive separate proxy cards. Upon
written or oral request, we will undertake to promptly deliver a separate copy of the proxy materials and annual report to any stockholder
at a shared address to which we delivered a single copy of any of these documents. To receive a separate copy, or, if you are receiving
multiple copies, to request that we only send a single copy of next years proxy materials and annual report, you may contact us
at the address below, or call us at 858-900-2660:
Arcturus Therapeutics Holdings Inc.
Stockholders who hold shares in street name
may contact their brokerage firm, bank, broker-dealer or other nominee to request information about householding.
When are stockholder proposals due for next years annual
meeting?
Please see the section entitled
Proposals
of Stockholders for 2026 Annual Meeting
in this proxy statement for more information regarding the deadlines for the submission
of stockholder proposals for our 2026 annual meeting.
6
BOARD OF DIRECTORS AND CORPORATE GOVERNANCE
Composition of the Board
Our Board is currently composed of nine members.
The following table sets forth the names, ages, and certain other information for our directors.
Dr. Peter Farrell
is the Chairman of
our Board, a position he has held since May 2018. In addition, Dr. Farrell is the founder, former long-term CEO and current Chairman of
ResMed Inc. (NYSE:RMD). Dr. Farrell has been Chairman and a director of ResMed since 1989, when the company began as a management buyout
of sleep technology from Baxter Healthcare. Peter was previously Foundation Director of the University of New South Wales (UNSW) Graduate
School for Biomedical Engineering (1978-89) while simultaneously serving as Vice President of Research Development for Baxter Healthcare
in Tokyo (1984-89). Dr. Farrell served on the board of directors of NuVasive, Inc., a company focused on the surgical treatment of spine
disorders. Dr. Farrell serves on the board of trustees of The Scripps Research Institute in La Jolla and is Chairman of the Boston-based
POC NMR diagnostic company, WaveGuide. Since July 2019, Dr. Farrell has been a director of Evolus, Inc. (EOLS). Dr. Farrell is a fellow
or honorary fellow of several professional bodies, including the US National Academy of Engineering. He was inducted as 1998 San Diego
Entrepreneur of the Year for Health Sciences, 2001 Australian Entrepreneur of the Year and 2005 US National Entrepreneur of the Year for
Health Sciences. Dr. Farrell was appointed to the Executive Council of the division of Sleep Medicine at Harvard Medical School in 1998,
was appointed Vice Chairman in 2000 (2000-2010), became Chairman in 2010 and served in that capacity for three years. He is on various
academic advisory boards including UCSDs Jacobs School of Engineering, where he was named the 2012 Gordon Fellow, UCSDs
Rady Business School and the MIT Dean of Engineerings Advisory Council. Dr. Farrell holds a B.E. with honors in chemical engineering
from the University of Sydney, an SM in chemical engineering from MIT, a PhD in bioengineering from the University of Washington, Seattle,
and a DSc from UNSW for research which resulted in improved treatment for both hemodialysis and peritoneal dialysis patients. Dr. Farrell
is nominated for re-election on our Board because of his significant experience as an executive and director of a number of companies
in the healthcare sector.
Effective July 1, 2025, Dr. Farrell will no longer be Chairman of the
Board and will continue as a director.
Joseph E. Payne
is our President and
Chief Executive Officer, positions he has held since March 2013. Mr. Payne served on our predecessors board since March 2013. He
brings with him an exceptional track record of ushering novel therapeutics to the clinic including targeted RNA medicines utilizing lipid-mediated
delivery technologies. Mr. Paynes background includes over 20 years of successful drug discovery experience at Merck Research Labs,
DuPont Pharmaceuticals, Bristol-Myers Squibb, Kalypsys, and Nitto Denko Corporation as evidenced by over 40 publications and patents,
and several investigational new drug (IND) clinical candidates. His academic training includes a Bachelors Degree in Chemistry,
magna cum laude from Brigham Young University, a Master of Science in Synthetic Organic Chemistry from the University of Calgary and Executive
Training Certification from MIT Sloan School of Management. He served on the board of directors of Vallon Pharmaceuticals Inc., a public
clinical-stage company focused on the development and commercialization of novel abuse-deterrent medications for CNS disorders, until
April 2023. Mr. Payne is nominated for re-election on our Board because of his position as our President and Chief Executive Officer and
his significant experience in the pharmaceutical sector. As a member of our executive team, Mr. Payne serves a vital function in the link
between management and our Board, enabling the Board to perform its oversight function with the benefits of managements perspective
on the business.
7
Andy Sassine
has served as our Chief
Financial Officer since January 2019. Mr. Sassine served as one of our directors from May 2018 until June 2019, and was reelected as a
director in September 2019. Mr. Sassine serves on the board of directors of iCAD Inc. (NASDAQ:ICAD), a leading provider of advanced image
analysis, workflow solutions and radiation therapy for early detection and treatment of cancer. Mr. Sassine served in various positions
at Fidelity Investments from 1999 to 2012, including, most recently as Portfolio Manager. Between 2004 and 2011, he managed the Fidelity
Small Cap Stock Fund, the Fidelity International Small Cap Opportunities Fund and the Fidelity Advisor International Small Cap Opportunities
Fund. Mr. Sassine joined Fidelity as a high yield research analyst, covering the Telecommunications, Satellite, Technology, Defense and
Aerospace, and Restaurant Industries and in 2001, joined the international group as a research analyst covering small and mid-cap international
stocks. Mr. Sassine earned a Bachelor of Arts degree at the University of Iowa in 1987 and an MBA from the Wharton School at the University
of Pennsylvania in 1993. Mr. Sassine is nominated for re-election on our Board because of his position as our Chief Financial Officer
and his extensive knowledge and experience as a fund manager and board member of other similarly-sized companies.
James Barlow
is a member of the board
of directors of NAHS Holding, Inc., an Employee Stock Ownership Plan company, whose affiliates provide post-acute care, subacute care,
short and long-term rehabilitation, and skilled nursing in the United States. Mr. Barlow is a C-level financial executive with more than
30 years of experience leading teams in the successful strategic achievement of financial and operational goals, and expertise in domestic
and international operations, financial planning, forecasting and reporting, restructurings, business development and integrations, treasury
and investor relations. As an Executive Officer (Principal Accounting Officer) at Allergan, Inc. from January 2002 to March 2015, he oversaw
financial due diligence, integration and structuring for all significant asset purchases, sales, business combinations and licensing transactions,
the spin-off of Advanced Medical Optics, the $3.3 billion acquisition of Inamed Corporation and more than $4.5 billion in other transactions.
He ensured consistent application of corporate policies and procedures and alignment with global reporting and corporate compliance requirements,
made recommendations globally to improve financial operations and participated in robust financial planning/forecasting activities. Prior
to joining Allergan, Mr. Barlow served as Chief Financial Officer of Wynn Oil Company, a division of Parker Hannifin Corporation, during
2001, Treasurer and Controller of Wynns International, Inc. from 1990 to 2000 and Vice President and Controller of Ford Equipment
Leasing Company from 1986 to 1990. From 1983 to 1985 Mr. Barlow worked for the accounting firm Deloitte Haskins and Sells. Mr. Barlow
received a Bachelor of Science degree in Accounting, graduating magna cum laude, from Brigham Young University and a Master of Accountancy,
graduating with honorshigh distinction, from Brigham Young University. He is a certified public accountant (inactive). Mr. Barlow
is nominated for re-election on our Board of Directors because of his significant experience as an executive and director of a number
of companies in the healthcare sector, and because of his financial and accounting expertise.
Dr. Edward W. Holmes
has served as a
member of our Board of Directors since September 2019. Dr. Holmes is currently a Distinguished Professor of Medicine at the University
of California, Vice Chancellor/Dean of Health Sciences Emeritus at the University of California, San Diego, and CEO/President of the Sanford
Consortium for Regenerative Medicine. Dr. Holmes has served as Chair of the Department of Medicine at the University of Pennsylvania,
Vice President for Translational Medicine at Stanford University, and Vice Chancellor/Dean of Duke University School of Medicine. Dr.
Holmes was the Executive Deputy Chairman of the Biomedical Research Council and the Executive Chairman of the National Medical Research
Council in Singapore; he was a Senior Fellow in A*STAR and Advisor to the National Research Council of Singapore. He holds an appointment
as the Lien Ying Chow Professor of Medicine at the Yong Loo Lin School of Medicine, National University of Singapore. For his contributions
to the Singapore government, Dr. Holmes was made an Honorary Citizen in 2011, and he was awarded the Presidents Science and Technology
Medal in 2017. Dr. Holmes also served on the Council of Advisors for the National Institute for Diabetes, Digestive, and Kidney Diseases
of the National Institutes of Health. He served as Chair of the Research Advisory Board of GlaxoSmithKline, on the scientific advisory
board of Ajinomoto and on the board of directors of Tularik, Inc. He also served on the Grand Challenges Explorations Innovation Review
Panel for the Gates Foundation. He has been elected to membership in the American Society for Clinical Investigation, the Association
of American Physicians, Fellow of the American Association for the Advancement of Science, and a member of the United States National
Academy of Medicine. Dr. Holmes holds a Doctor of Medicine degree from the University of Pennsylvania. Dr. Holmes is nominated for re-election
on our Board because of his significant experience in research, medicine and genetics.
8
Dr. Magda Marquet, Ph.D.
, joined our
Board of Directors in 2018. Dr. Marquet has served as co-founder and co-chief executive officer of ALMA Life Sciences LLC, an early-stage
healthcare investment firm, since 2013. Dr. Marquet also has been a co-founder of AltheaDx, a biotechnology company, since 2009. Dr. Marquet
previously served as the co-founder and chairman of Althea Technologies from 2009 to 2019, and previously served as its co-president and
co-chief executive officer from 1998 to 2009. Prior to starting Althea Technologies, Dr. Marquet held several positions in product development
and pharmaceutical development in companies such as Vical and Amylin Pharmaceuticals. Dr. Marquet served on the board of directors of
Pfenex from 2019 until its acquisition by Ligand Pharmaceuticals in October 2020 and now serves on the board of directors of AnaptysBio
since January 2021 as well as several private company boards. Dr. Marquet holds a Ph.D. in biochemical engineering from INSA/University
of Toulouse, France. Dr. Marquet is nominated for re-election on our Board because of her significant experience as an executive and director
of a number of companies in the life sciences sector, and because of her management and clinical expertise.
Dr. Jing L. Marantz, M.D., Ph.D.
, joined
our Board of Directors in December 2021. Dr. Marantz has served as Chief Medical Officer of Scholar Rock Holding Corporation, a clinical
stage biopharmaceutical company, since November 2022. From January 2022 to August 2022, Dr. Marantz served as Chief Business Officer of
Krystal Biotech, Inc. after serving on its board for a year. From October 2020 to January 2022, Dr. Marantz served as Senior Vice President
of Medical Affairs of Acceleron Pharma Inc. until its acquisition by Merck Co., Inc. From June 2018 to September 2020, Dr. Marantz
served as Senior Vice President of Medical Affairs at Alnylam Pharmaceuticals. Prior to Alnylam, Dr. Marantz has held leadership positions
at Alexion, Biogen, ARIAD, and Millennium Pharmaceuticals across development, medical affairs, and business development. Previously Dr.
Marantz was a management consultant with Strategic Decisions Group and briefly affiliated with Massachusetts General Hospital following
a post-doctoral fellowship at the Dana-Farber Cancer Institute. Dr. Marantz received her medical training from Tongji Medical College,
a Ph.D. in Biochemistry and Molecular Biology from Medical University of South Carolina, and an MBA from the University of California
at Berkeley. Dr. Marantz is nominated for re-election on our Board because of her significant experience as an executive and director
of a number of companies in the life sciences sector, and because of her management and clinical expertise.
Dr. John H. Markels, Ph.D.
, joined our
Board of Directors in December 2022. Dr. Markels serves on the board of directors of Sangamo Therapeutics and chairs and serves on the
advisory boards for the University of California, Berkeley College of Chemistry and University of Delaware Department of Chemical and
Biomolecular Engineering, respectively. Dr. Markels retired from Merck Co., Inc. (Merck) in March 2022, most recently
as President of Global Vaccines, where he led an integrated team dedicated to discovery and development, supply and access, and global
marketing and long-term strategy for the vaccines portfolio. Earlier roles at Merck included President, Latin America from January 2018
to January 2019, SVP, Global Human Health Business Strategy from January 2017 to December 2017, Managing Director, Mexico from November
2013 to January 2017. Prior to his commercial roles, he had a long career in senior leadership positions in global manufacturing, including
operations leadership for Europe, Middle East and Africa, Asia Pacific and emerging markets as well as manufacturing technology and product
development roles in active pharmaceutical ingredients (API) and vaccines. Dr. Markels received his Ph.D. in chemical engineering from
the University of California, Berkeley and his B.S. in chemical engineering from the University of Delaware. Dr. Markels is nominated
for re-election on our Board because of his significant experience as an executive and director of a number of companies in the life sciences
sector, and because of his management and expertise in the pharmaceutical, manufacturing, and technology sectors.
Dr.
Moncef Slaoui, Ph.D.
, joined our Board of Directors in June 2024. Dr. Slaoui served as a Partner at Medicxi, a venture capital firm,
from July 2017 to March 2021. In May 2020, Dr. Slaoui was appointed as chief advisor to the White Houses Operation Warp Speed initiative,
the administrations national program to accelerate the development, manufacturing, and distribution of COVID-19 vaccines, therapeutics,
and diagnostics, where he served until January 2021. Dr. Slaoui served on the board of directors of Vaxcyte, Inc., a publicly traded biotechnology
company (NASDAQ: PCVX), from July 2017 to March 2021 and served as the Chairman from May 2018 to March 2021. From September 1988 to July
2017, Dr Slaoui was employed at GlaxoSmithKline plc (
GSK
), a multinational
pharmaceutical company (NYSE: GSK). Between 1988 and 2003, he served in various RD leadership roles in GSKs vaccine division.
From June 2009 to June 2017, Dr. Slaoui served as the Chairman of Vaccines at GSK, and from June 2003 to June 2006, he served as head
of Worldwide Business Development at GSK. From March 2006 to July 2017, he served as Chairman of GSK Pharmaceutical RD. Dr. Slaoui
currently serves on the boards of directors of private biotechnology companies, including ALTESA Biosciences and ZephyrAI. From July 2017
to May 2020, Dr. Slaoui served on the board of directors of Moderna, Inc., a biotechnology company, and from April 2020 to May 2020, Dr.
Slaoui served on the board of directors of Lonza Group Ltd. From 2016 to March 2021, Dr. Slaoui served as Chairman of the board of directors
of Galvani Bioelectronics, a company launched in November 2016 that GSK jointly owns with Verily Life Sciences. From 1984 to 1988, Dr.
Slaoui served as a professor of Immunology at the University of Mons, Belgium. Dr. Slaoui holds a Ph.D. in Molecular Biology and Immunology
from the Universit Libre de Bruxelles, Belgium. Dr. Slaoui is nominated for re-election on our Board because of his depth of vaccine
industry and public company experience.
Effective July 1, 2025, Dr. Slaoui will become
Chairman of the Board.
9
Director Independence
The listing rules of Nasdaq require us to maintain
a Board comprised of a majority of independent directors, as determined affirmatively by our Board. In addition, the Nasdaq listing rules
require that, subject to specified exceptions, each member of our audit, compensation and nominating and corporate governance committees
must be independent. Audit committee members and compensation committee members must also satisfy the independence criteria set forth
in Rule 10A-3 and Rule 10C-1, respectively, under the Securities Exchange Act of 1934, as amended (the Exchange Act). Under
the Nasdaq listing rules, a director will only qualify as an independent director if, in the opinion of our Board, the director
does not have a relationship that would interfere with the exercise of independent judgment in carrying out his or her responsibilities.
Our Board has undertaken a review of the independence
of our directors and considered whether any director has a material relationship with us that could compromise his or her ability to exercise
independent judgment in carrying out his or her responsibilities. Based upon information requested from and provided by each director
concerning his or her background, employment and affiliations, including family relationships, our Board has determined that none of Dr.
Farrell, Mr. Barlow, Dr. Holmes Dr. Marquet, Dr. Marantz, Dr. Markels, and Dr. Slaoui (representing seven of our nine directors), has
a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that
they each are an independent director as that term is defined under the Nasdaq listing rules. Mr. Payne is not considered
independent due to his position as our President and Chief Executive Officer. Mr. Sassine is not considered independent due to his position
as our Chief Financial Officer.
In making these determinations, our Board considered
the relationships that each nonemployee director has with us and all other facts and circumstances our Board deemed relevant in determining
their independence, including consulting relationships, family relationships and the beneficial ownership of our capital stock by each
non-employee director.
Board Leadership Structure
Our Board is currently chaired by Dr. Farrell.
Effective July 1, 2025, Dr. Farrell will no longer be Chairman of the
Board and will continue as a director, and Dr. Slaoui will become Chairman of the Board.
Our Board believes that we and our stockholders
are currently best served by this leadership structure. As Chairman, Dr. Farrell promotes unified leadership and direction for our Board
and management and provides the critical leadership necessary for carrying out our strategic initiatives. Dr. Farrell, together with our
Boards strong committee system and independent directors, allows our Board to maintain effective oversight of our business operations,
including independent oversight of our financial statements, executive compensation, selection of director candidates, and corporate governance
programs. We believe this will continue once Dr. Slaoui is named Chairman.
We believe our current Boards leadership
structure enhances its ability to effectively carry out its roles and responsibilities on behalf of our stockholders.
10
There are no family relationships among any
of our directors and executive officers, nor have any of our directors or executive officers been involved in a legal proceeding that
would be required to be disclosed pursuant to either 103(c)(2) or 401(f) of Regulation S-K of the Exchange Act.
Role of Board in Risk Oversight Process
Our Board has an active role, as a whole and
also at the committee level, in overseeing risk management. Our Board is responsible for general oversight and regular review of risk
management, including financial, strategic, and operational risks. The compensation committee is responsible for overseeing the management
of risks relating to our executive compensation plans and arrangements, and whether our compensation policies and programs have the potential
to encourage excessive risk taking. The audit committee is responsible for overseeing the management of risks relating to accounting matters,
financial reporting, and cybersecurity. The nominating and corporate governance committee is responsible for overseeing our corporate
governance practices and the management of risks associated with Board independence and potential conflicts of interest. Although each
committee is responsible for evaluating and overseeing the management of certain risks, the entire Board is regularly informed through
discussions from committee members about such risks. The Board believes its leadership structure is consistent with and supports the administration
of its risk oversight function.
Board Meetings and Committees
During 2024, our Board held six
meetings, and each director attended at least 75% of the aggregate of (i) the total number of meetings of our Board held during the period
for which he or she has been a director and (ii) the total number of meetings held by all committees of our Board on which he or she served
during the periods that he or she served.
Our Board has established an audit committee,
a compensation committee and a nominating and corporate governance committee. The composition and responsibilities of each of the committees
of our Board is described below.
Audit Committee
The members of our audit committee are Mr. Barlow,
Dr. Holmes and Dr. Markels. Mr. Barlow serves as the chairman. Each of the members of our audit committee is an independent director under
the Nasdaq listing rules, satisfies the additional independence criteria for audit committee members and satisfies the requirements for
financial literacy under the Nasdaq listing rules and Rule 10A-3 of the Exchange Act, as applicable.
Our Board has also determined that Mr. Barlow
qualifies as an audit committee financial expert within the meaning of the applicable rules and regulations of the SEC and satisfies the
financial sophistication requirements of the Nasdaq listing rules.
Our audit committee oversees our corporate accounting
and financial reporting process and assists our Board in monitoring our financial systems and our legal and regulatory compliance. Our
audit committee also:
11
Our audit committee operates under
a written charter approved by our Board and that satisfies the applicable rules and regulations of the SEC and the listing requirements
of Nasdaq. The charter is available on the corporate governance section of our website, which is located at http://ir.arcturusrx.com/governance-highlights.
Our audit committee held six meetings during 2024.
Compensation Committee
The members of our compensation committee are
Dr. Marquet, Dr. Marantz and Mr. Barlow. Dr. Marquet is currently the chairwoman of our compensation committee. Our Board has determined
that each member of our compensation committee is an independent director under the current rules of Nasdaq, satisfies the additional
independence criteria for compensation committee members under Rule 10C-1 of the Exchange Act and the Nasdaq listing rules, is a non-employee
director within the meaning of Rule 16b-3 under the Exchange Act, and is an outside director for purposes of Section
162(m) of the Internal Revenue Code of 1986, as amended (the Code).
Our compensation committee oversees our corporate
compensation programs. The compensation committee also:
Our compensation committee is also responsible for assessing
and monitoring whether any of our compensation policies and programs have the potential to encourage excessive risk-taking.
Our compensation committee operates
under a written charter approved by our Board and that satisfies the applicable rules and regulations of the SEC and the listing requirements
of Nasdaq. The charter is available on the corporate governance section of our website, which is located at http://ir.arcturusrx.com/governance-highlights.
Our compensation committee held four meetings during 2024.
Compensation Committee Interlocks and
Insider Participation
None of the members of the compensation committee
was at any time one of our officers or employees. None of our executive officers serves as a member of the board of directors or compensation
committee of any entity that has one or more executive officers serving as members of our Board or compensation committee.
Nominating and Corporate Governance Committee
The members of our nominating and corporate
governance committee are Dr. Holmes, Dr. Marantz and Dr. Markels. Dr. Holmes is the chairman of our nominating and corporate governance
committee. Our Board has determined that each member of our nominating and corporate governance committee is independent under the Nasdaq
listing rules.
12
Our nominating and corporate governance committee
oversees and assists our Board in reviewing and recommending nominees for election as directors. The nominating and corporate governance
committee also:
Our nominating and corporate governance
committee operates under a written charter approved by our Board and that satisfies the applicable rules and regulations of the SEC and
the listing requirements of Nasdaq. The charter is available on the corporate governance section of our website, which is located at http://ir.arcturusrx.com/governance-highlights.
Our nominating and corporate governance committee held two meetings during 2024.
Considerations in Evaluating Director Nominees
In its evaluation of director candidates, including
the member or members of the Board eligible for reelection, our nominating and corporate governance committee will consider the following:
The nominating and corporate governance committee also focuses on issues
of diversity, such as diversity in experience, international perspective, background, expertise, skills, age, gender, and ethnicity. The
nominating and corporate governance committee does not have a formal policy with respect to diversity; however, our Board and the nominating
and corporate governance committee believe that it is essential that members of our Board represent diverse viewpoints. Any nominee for
a position on the Board must satisfy the following minimum qualifications:
If our nominating and corporate governance committee
determines that an additional or replacement director is required, the committee may take such measures as it considers appropriate in
connection with its evaluation of a director candidate, including candidate interviews, inquiry of the person or persons making the recommendation
or nomination, engagement of an outside search firm to gather additional information, or reliance on the knowledge of the members of the
committee, Board or management.
After completing its review and evaluation of
director candidates, our nominating and corporate governance committee recommends to our full Board the director nominee. Our nominating
and corporate governance committee has discretion to decide which individuals to recommend for nomination as directors and our Board has
the final authority in determining the selection of director candidates for nomination to our Board.
13
Requirements for Stockholder Recommendations
of a Candidate to our Board
Our nominating and corporate governance committee
will consider recommendations for candidates to our Board from our stockholders. A stockholder that wishes to recommend a candidate for
consideration by the committee as a potential candidate for director must direct the recommendation in writing to Arcturus Therapeutics
Holdings Inc., 10628 Science Center Drive, Suite 250, San Diego, California 92121, Attention: Corporate Secretary, and must include the
candidates name, home and business contact information, detailed biographical data, relevant qualifications, a signed letter from
the candidate confirming willingness to serve, information regarding any relationships between us and the candidate and evidence of the
recommending stockholders ownership of our stock. Such recommendation must also include a statement from the recommending stockholder
in support of the candidate, particularly within the context of the criteria for Board membership, including character, integrity, judgment,
diversity of experience, independence, area of expertise, corporate experience, potential conflicts of interest, other commitments and
personal references. Our nominating and corporate governance committee will consider the recommendation but will not be obligated to take
any further action with respect to the recommendation. See
Stockholder Proposals and Director Nominations Not for Inclusion
in Proxy Statement
elsewhere in this proxy statement for additional requirements on the timeliness for recommendations for
candidates in connection with next years annual meeting.
Communications with the Board
In cases where stockholders or other interested
parties wish to communicate directly with our non-management directors, messages can be sent to Arcturus Therapeutics Holdings Inc., 10628
Science Center Drive, Suite 250, San Diego, California 92121, Attention: Corporate Secretary. Our corporate secretary monitors these communications
and will provide a summary of all received messages to the Board at each regularly scheduled meeting of the Board. Our Board generally
meets on a quarterly basis. Where the nature of a communication warrants, our corporate secretary may determine, in his judgment, to obtain
the more immediate attention of the appropriate committee of the Board, non-management directors, independent advisors or our management,
as our corporate secretary considers appropriate.
Our corporate secretary may decide in the exercise
of his or her judgment whether a response to any stockholder or interested party communication is necessary.
This procedure for stockholder and other interested
party communications with the non-management directors is administered by our nominating and corporate governance committee. This procedure
does not apply to (i) communications to non-management directors from our officers or directors who are stockholders or (ii) stockholder
proposals submitted pursuant to Rule 14a-8 under the Exchange Act.
Director Attendance at Annual Meetings
We do not have a formal policy regarding attendance
by members of our Board at annual meetings of stockholders. We encourage, but do not require, directors to attend.
Code of Business Conduct and Ethics
The Companys Code of Business Conduct
and Ethics (the Code of Conduct) is applicable to all directors, officers and employees of the Company and its subsidiaries,
including but not limited to the Companys principal executive officer and principal financial officer.
A copy of the Code of Conduct on the corporate governance section
of our website, which is located at https://ir.arcturusrx.com/static-files/d91a5916-5ba8-450b-9a87-11c2b87daf0a.
Human Capital Management
At Arcturus, dedication to human capital
management is a core component of our corporate governance and culture. Our comprehensive approach to human capital management is grounded
in our core values of integrity, excellence, and respect for people, which reflect our commitment to creating a safe, supportive, ethical,
and rewarding work environment.
14
As of December 31, 2024, we had approximately 176 employees, of which
174 were full-time and 2 were part-time. Additionally, we are supported by contractors and scientific consultants in most areas of the
business. None of our employees are represented by a labor union or covered by a collective bargaining agreement. We consider relations
with our employees to be good.
Environmental, Social and Governance
Practices
We do not currently have a formal Environmental,
Social and Governance Policy (ESG Policy) in place, but plan to do so in the future. We anticipate that the ESG Policy,
when adopted by the Board, will include Human Capital Management as a key component, and focus on various topics, which
may or may not include (1) hiring, promotion and talent development; (2) health and safety; (3) compensation and benefits; and (4) diversity
and inclusion. Although we have not adopted a formal ESG Policy, our management and leadership incorporates the foregoing and other environmental,
social and governance considerations in all matters related to human capital and human capital management.
Insider Trading Policy
We have adopted a written insider trading policy (the Insider
Trading Policy) governing the purchase, sale, and/or other dispositions of our securities by directors, officers, employees, and
certain consultants and independent contractors, which the Company believes is reasonably designed to promote compliance with insider
trading laws, rules and regulations, and applicable Nasdaq listing standards.
Employee, Officer and Director Hedging
Pursuant to the Insider Trading Policy, officers,
employees, and certain consultants and independent contractors are prohibited from engaging in any hedging transactions (including transactions
involving options, puts, calls, prepaid variable forward contracts, equity swaps, collars and exchange funds, or other derivatives) that
are designed to hedge or speculate on any change in the market value of our securities.
15
DIRECTOR COMPENSATION
Director Compensation Table
The following table and related footnotes show the compensation paid
during the year ended December 31, 2024 to our non-employee directors.
Narrative to Director Compensation Table
Our director compensation policy is intended
to provide a total compensation package that enables us to attract and retain qualified and experienced individuals to serve as directors
and to align our directors interests with those of our stockholders.
Annual Cash Compensation
The annual retainers payable to non-employee directors for service
on the Board and its committees are (i) $50,000 for service on the Board, (ii) $10,000 for service on the compensation committee, (iii)
$5,000 for service on the nominating and corporate governance committee, (iv) $10,000 for service on the audit committee, (v) an additional
$35,000 for the Chairman of the Board, (vi) an additional $10,000 for the chairman of the compensation committee, (vii) an additional
$5,000 for the chairman of the nominating and corporate governance committee, and (viii) an additional $10,000 for the chairman of the
audit committee.
Inaugural Equity Grants
Each non-employee director who joins the board is granted an equity
award of an option to purchase 15,000 shares of our common stock, which vests monthly over a two-year period from the date of grant.
Annual Equity Grants
Each non-employee director received an annual equity award of an option
to purchase 15,000 shares of our common stock, which vests monthly over a one-year period from the date of grant. New directors receive
an annual equity grant that is prorated based on the number of days until the next expected Annual Shareholder meeting to align with days
of service in the year of grant.
16
PROPOSAL NUMBER 1
Our Board is currently composed of nine directors.
At the annual meeting, each director will be elected to our Board by the holders of our common stock. Each directors term continues
until the election and qualification of his or her successor, or such directors earlier death, resignation or removal.
Nominees for Director
Our nominating and corporate governance committee
recommended for nomination and our Board nominated each of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward
W. Holmes, Dr. Magda Marquet, Dr. Jing L. Marantz, Dr. John H. Markels, and Dr. Moncef Slaoui for election as a director at the annual
meeting. If elected, each will serve as a director until our next annual meeting and until his or her respective successor is duly elected
and qualified. For more information concerning each of the nominees, please see the section entitled
Board of Directors and
Corporate Governance
.
Each of the nominees has agreed to serve if
elected, and management has no reason to believe that he or she will be unavailable to serve. In the event he or she is unable or declines
to serve as a director at the time of the annual meeting, proxies will be voted for any nominee who may be proposed by the nominating
and corporate governance committee and designated by the present Board to fill the vacancy.
Required Vote
The directors elected to the Board will be elected
by a plurality of the votes cast by the holders of shares present in person (including virtually) or represented by proxy and entitled
to vote on the election of a director. In other words, if each of the nominees receives a single FOR vote, he or she will
be elected as a director. Shares represented by executed proxies will be voted, if authority to do so is not expressly withheld, to elect
of each of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet, Dr. Jing L. Marantz,
Dr. John H. Markels, and Dr. Moncef Slaoui as a director.
Board Recommendation:
Our Board recommends a vote FOR the election to
the Board of each of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet, Dr. Jing
L. Marantz, Dr. John H. Markels, and Dr. Moncef Slaoui as a director.
17
PROPOSAL NUMBER 2
In accordance with Section 14A of the Exchange
Act and the related rules of the SEC, the Company is asking its stockholders to vote to approve, on an advisory (non-binding) basis, the
compensation of our named executive officers as disclosed in this proxy statement. This proposal, commonly known as a say-on-pay
proposal, gives our stockholders the opportunity to express their views on the compensation of our named executive officers. This vote
is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and
the principles, policies and practices described in this proxy statement. Accordingly, the following advisory resolution is submitted
for stockholder vote at the annual meeting:
RESOLVED, that the stockholders of Arcturus Therapeutics
Holdings Inc. (the Company) approve, on an advisory basis, the compensation of the Companys named executive officers
as disclosed in this proxy statement pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including
the compensation tables regarding named executive officer compensation and the narrative disclosures that accompany the compensation tables.
Although the say-on-pay vote is
non-binding, the board of directors and the compensation committee will carefully review and consider the voting results when evaluating
our named executive officer compensation program.
Required Vote
The Say on Pay Proposal requires the affirmative
FOR vote of a majority of the votes cast on the proposal at the annual meeting. You may vote FOR, AGAINST,
or ABSTAIN on this proposal.
Board Recommendation
Our Board recommends a vote FOR
the approval of the non-binding advisory resolution approving the Companys Named Executive Officer compensation.
18
PROPOSAL NUMBER 3
Our audit committee has appointed Deloitte as
the independent registered public accounting firm to audit our consolidated financial statements for the year ending December 31, 2025.
Notwithstanding such appointment and even if
our stockholders ratify such appointment, our audit committee, in its discretion, may appoint another independent registered public accounting
firm at any time during the year if it believes that such a change would be in the best interests of Arcturus and its stockholders. Our
audit committee is submitting the appointment of Deloitte to our stockholders because we value our stockholders views on such appointment
and as a matter of good corporate governance. If the appointment is not ratified by our stockholders, our audit committee may consider
appointing another independent registered public accounting firm. A representative of Deloitte is expected to be present virtually at
the annual meeting, and will be available to respond to appropriate questions following the virtual annual meeting, but is not expected
to make a statement.
Fees Paid to Independent Registered Public Accounting Firm
The following table sets forth the fees billed
to us and our subsidiaries by Deloitte, an independent registered public accounting firm, which served as our principal accountant for
the year ended December 31, 2024.
All fees described above were pre-approved by the audit committee.
No fees were paid to Deloitte for accounting services for the year ended December 31, 2023.
The following table sets forth the fees billed to us and
our subsidiaries by Ernst Young LLP (EY), the Companys former independent registered public accounting
firm, which served as our principal accountant for the year ended December 31, 2023.
19
All fees described above were pre-approved by
the audit committee.
Auditor Independence
In 2024, there were no other professional services
provided by Deloitte or EY that would have required our audit committee to consider their compatibility with maintaining the independence
of Deloitte or EY.
Change of Independent Public Accounting Firm
On April 5, 2024, the audit committee authorized the dismissal of EY
as the Companys independent registered public accounting firm, and EY was dismissed as the Companys independent registered
public accounting firm as of such date. EY served as the Companys independent registered public accounting firm for the fiscal
year ended December 31, 2023 and 2022 and the subsequent periods through April 5, 2024. EYs report on the Companys
consolidated financial statements as of and for the years ended December 31, 2023 and 2022 did not contain an adverse opinion or disclaimer
of opinion, and were not qualified or modified as to uncertainty, audit scope or accounting principles.
During the Companys fiscal years ended
December 31, 2023 and 2022 and the subsequent interim period through April 5, 2024: (i) there were no disagreements between the Company
and EY on any matters of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which
disagreements, if not resolved to the satisfaction of EY, would have caused them to make reference to the subject matter of the disagreements
in connection with their opinion on the Companys consolidated financial statements; and (ii) there were no reportable events
(as described in Item 304(a)(1)(v) of Regulation S-K).
Effective April 5, 2024, the audit committee
authorized the appointment of Deloitte as the Companys new independent registered public accounting firm for the fiscal year ending
December 31, 2024, and Deloitte was appointed as the Companys independent registered public accounting firm. The decision to change
the Company's principal independent accountants was the result of a competitive process undertaken by management and the audit committee
as well as the Company's focus on reducing its general and administrative expenses. During the Companys fiscal years ended December
31, 2023 and 2022, and the subsequent interim period through April 5, 2024, neither the Company nor anyone acting on behalf of the Company
had consulted Deloitte regarding either: (i) the application of accounting principles to a specified transaction, either completed or
proposed, or the type of audit opinion that might be rendered on the Companys financial statements, nor did Deloitte provide a
written report or oral advice to the Company that Deloitte concluded was an important factor considered by the Company in reaching a decision
as to the accounting, auditing or financial reporting issues; or (ii) any matter that was either the subject of a disagreement
(as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable event (as described in
Item 304(a)(1)(v) of Regulation S-K).
Pre-Approval Policy
Our audit committee has a pre-approval policy
for the engagement of our independent registered public accounting firm to perform certain audit and non-audit services. Pursuant to this
policy, which is designed to assure that such engagements do not impair the independence of our auditors, the audit committee pre-approves
annually a catalog of specific audit and non-audit services in the categories of audit services, audit-related services and tax services
that may be performed by our independent registered public accounting firm. If a type of service, that is to be provided by our auditors,
has not received such general pre-approval, it will require specific pre-approval by our audit committee. The policy prohibits retention
of the independent registered public accounting firm to perform the prohibited non-audit functions defined in applicable SEC rules.
20
Required Vote
Ratification of the appointment of Deloitte
as our independent registered public accounting firm for the year ending December 31, 2025 requires the affirmative FOR
vote of a majority of the votes cast on the proposal at the annual meeting. You may vote FOR, AGAINST, or
ABSTAIN on this proposal.
Board Recommendation
Our Board recommends a vote FOR the ratification
of the appointment of Deloitte as our independent registered public accounting firm for the year ending December 31, 2025.
21
Report
of the Audit Committee
The audit committee is a committee
of our Board comprised solely of independent directors as required by the listing standards of Nasdaq and rules and regulations of the
SEC. The audit committee operates under a written charter approved by our Board, which is available on the corporate governance section
of our web site at http://ir.arcturusrx.com/governance-highlights. The audit committee held six meetings in 2024. The meetings of the
audit committee are designed to facilitate and encourage communication among the audit committee, us and our independent auditor. The
composition of the audit committee, the attributes of its members and the responsibilities of the audit committee, as reflected in its
charter, are intended to comply with applicable requirements for corporate audit committees. The audit committee reviews and assesses
the adequacy of its charter and its performance on an annual basis.
With respect to our financial reporting process,
our management is responsible for (i) establishing and maintaining internal controls and (ii) preparing our consolidated financial statements.
Arcturus independent registered public accounting firm is responsible for performing an independent audit of Arcturus consolidated
financial statements in accordance with the auditing standards of the Public Company Accounting Oversight Board (United States), or PCAOB,
and to issue a report thereon. It is the responsibility of the audit committee to oversee these activities. Specifically, the audit committee
is responsible for the appointment, compensation, and general oversight of the external auditor, as well as fee negotiations with the
external auditor. It is not the responsibility of the audit committee to prepare Arcturus financial statements. These are the fundamental
responsibilities of management. In the performance of its oversight function, the audit committee has:
Based on the audit committees review
of the audited financial statements and the various discussions with management and Deloitte, the audit committee recommended to our Board
that the audited financial statements be included in our annual report on Form 10-K for the fiscal year ended December 31, 2024 for filing
with the SEC.
James Barlow
Dr. Edward Holmes
Dr. John H. Markels
This report of the audit committee shall
not be deemed to be soliciting material or to be filed with the SEC or subject to Regulation 14A promulgated
by the SEC or Section 18 of the Exchange Act, and shall not be deemed incorporated by reference into any prior or subsequent filing by
Arcturus under the Securities Act of 1933, as amended (the Securities Act), or the Exchange Act, except to the extent Arcturus
specifically requests that the information be treated as soliciting material or specifically incorporates it by reference.
22
EXECUTIVE
OFFICERS
The names of our executive officers, their ages,
their positions with us and other biographical information are set forth below.
Biographical information for Joseph E. Payne
and Andy Sassine is set forth above in the section titled
Board of Directors and Corporate Governance
.
Dr. Padmanabh Chivukula
has served as
our Chief Scientific Officer and Chief Operating Officer since 2013. Dr. Chivukula has an exceptional and technically solid foundation
in nanoparticle technology. From 2008 until February 2013, Dr. Chivukula was employed by Nitto Denko Corporation, where his titles included
Group Leader and Chief Scientist. Dr. Chivukula brings over 15 years of experience in drug delivery and therapeutic drug development,
including leading the polymeric RNAi research department at Nitto. Dr. Chivukula has a Ph.D. in Pharmaceutical Chemistry from the University
of Utah where he specialized in nano particle technology.
Lance Kurata
has served as our Chief
Legal Officer since August 2020. Prior to joining Arcturus, Mr. Kurata was Partner and Chair of West Coast Technology Transactions at
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, PC. From 2002 to 2006, he was a partner at Fish Richardson, where he was a member
of the corporate group and nationwide head of the technology transactions practice. From 1996 until 2002, Mr. Kurata practiced corporate
law at Brobeck Phleger Harrison, specializing in strategic collaborations, public and private financings, mergers and acquisitions
and corporate governance. Mr. Kurata obtained his B.A. from University of California, Los Angeles and he earned his J.D. from Stanford
Law School.
23
EXECUTIVE
COMPENSATION
Compensation Discussion and Analysis
Introduction
The Compensation Discussion and Analysis is designed
to provide our stockholders with an understanding of our executive compensation philosophy and decision-making process. It discusses the
principles underlying the structure of the compensation arrangements for our Chief Executive Officer, Chief Financial Officer and our
other two most highly compensated executive officers who were serving as executive officers on December 31, 2024 (the NEOs).
Unless noted otherwise, any reference within the Compensation Discussion and Analysis to decisions made by the board of directors refers
to the decisions made by the independent members of the board of directors only. This Compensation Discussion and Analysis primarily focuses
on the compensation of our NEOs, as identified in the table below.
Our current compensation programs for the NEOs
are determined and approved by our board of directors, acting at the recommendation of the compensation committee. The compensation committee
takes into account Mr. Paynes recommendations regarding the compensation for our executive officers, although Mr. Payne does not
participate in the deliberations or determinations of his own compensation. The other NEOs do not have any role in determining or recommending
the form or amount of compensation paid to any of our executive officers.
Company Performance Highlights
In assessing the appropriate level of compensation for our executive
officers, we take into account the overall performance of the Company against the specific annual corporate objectives established by
the board of directors at the beginning of that year, as well as qualitative considerations related to drug discovery and development,
drug commercialization, and financial activities (including securing new financing).
The biotechnology industry is characterized by
stock price volatility and, as a result, our focus on pay-for-performance is based on an assessment of the level of the Companys
achievement against those specific objectives. For more information, see the section titled Company Performance Objectives
in this proxy statement. In addition to considering the Companys accomplishments and progress each year, we also think it is important
to consider the long-term performance of the executive leadership team. We believe that the skills, creativity and dedication of executive
leadership have led to significant accomplishments from January 2024 through December 2024.
We made significant progress in
2024 and met several key corporate goals. Commercial sales of KOSTAIVE, the sa-mRNA COVID vaccine that we developed, began in October
2024 in Japan by Meiji Seika Pharma (Meiji), CSL Seqirus exclusive partner in Japan, marking the first commercial
sales of an Arcturus-developed product. In February 2025, we received approval of KOSTAIVE from the European Commission (EC), which provided
further validation of our platform by another significant regulatory authority.
We initiated dosing in a Phase 1 clinical trial of a novel seasonal
influenza sa-mRNA vaccine candidate under our collaboration with CSL Seqirus in January 2024. In December 2024, we initiated dosing of
an sa-mRNA vaccine candidate against pandemic avian influenza (bird flu) in a Phase 1 trial funded by the Biomedical Advanced Research
and Development Authority (BARDA).
24
In our OTC program, we completed dosing of eight
subjects in August 2024 in a Phase 2 double-blind multiple-dose study of ARCT-810. In the second quarter of 2024, we expanded the Phase
2 clinical program of ARCT-810 with an open-label, multiple-dose study which initiated dosing in December 2024. ARCT-810 has received
Orphan Drug Designation from the FDA and Orphan Medicinal Product Designation from the European Medicines Agency (the EMA)
for treatment of OTC deficiency, as well as Fast Track Designation and Rare Pediatric Disease Designation from the FDA.
In our CF program, we initiated dosing in December
2024 in a Phase 2 multiple ascending dose study of ARCT-032 designed to identify a safe and effective dose in people with Class I (null)
CFTR mutations and other CF patients who do not benefit from CFTR modulators. In July 2024, we completed dosing and follow-up visits for
seven participants in a safety and tolerability Phase 1b clinical study in New Zealand of ARCT-032 in adults with CF. ARCT-032 has received
Orphan Drug Designation by the FDA and Orphan Medicinal Product Designation by the EMA for the treatment of CF, and Rare Pediatric Disease
Designation from the FDA.
We also improved our platform technologies and
advanced our early-stage research activities and manufacturing process development and operations. We conducted exploratory platform development
activities, including the evaluation of genome editing, and new targeting approaches, where our LUNAR and STARR platforms could potentially
be useful for identification and development of additional products for our portfolio. Also, with our sourcing partners, we manufactured
cGMP (current good manufacturing practices) batches yielding significant quantities of clinical trial materials for global studies of
our candidates, and with our collaborator, CSL Seqirus, we have established commercial production processes for the COVID-19 vaccine program.
The above accomplishments, milestones and advancements,
together with those achieved by the Company since inception, directly resulted in (1) the development, launch and advancement by the Company
of a significant drug candidate pipeline; (2) non-clinical and clinical development, and commercialization, of the Companys LUNAR-COVID
program; (3) the development and launch of an organization and infrastructure designed to execute on the Companys mission of becoming
a leading RNA medicines company; and (4) the establishment of a collaboration that has provided, and we expect will continue to provide
significant economic and clinical benefits. We believe that the compensation programs and awards to our NEOs should be evaluated within
the context of these significant accomplishments and performance over a sustained period of time.
Compensation Program Objectives and Philosophy
In order to continue the execution and growth
of our business as described above, we believe that it is vital that we continue to retain and attract experienced and skilled senior
leadership by offering competitive base compensation and benefits, significant performance-based incentives, and the potential for long-term
equity compensation. Our goal is to structure a meaningful portion of executive compensation such that it will only have value if management
is successful in building significant long-term value for our stockholders.
25
Our current executive compensation programs are
intended to achieve the following four fundamental goals and objectives: (1) to incentivize and reward sustained long-term performance
by aligning significant elements of executive compensation with our stockholders interests, (2) to attract and retain an experienced,
highly qualified and motivated executive management team to lead our business, (3) to provide economic rewards for achieving high levels
of our performance and individual contribution, and (4) to pay compensation that is competitive, taking into account the experience, skills
and performance of the executives required to build and maintain the organization necessary to support our mission to become a leading
RNA medicines company.
When structuring our executive compensation programs
to achieve our goals and objectives, we are guided by the following philosophies:
CEO Compensation
The Company assesses executive compensation on an annual basis and
makes annual equity grants in December of each year. During 2024, the total compensation reported in the Summary Compensation Table for
our CEO was below the median of the peer data reviewed by the compensation committee and was 24% lower than the amount reported in 2023,
with 2024 Total Direct Compensation in the Summary Compensation Table also below-median and lower than 2023 for all NEOs. This is to reflect
the fact that our stock price decreased by approximately 46% in the same period.
Executive Compensation Practices
Below we provide a summary of our executive compensation
practices, including both the practices that we follow and those that we do not follow, in each case based on whether we believe they
serve the long-term interests of our stockholders.
Core Compensation Principles and Practices
26
Role of Stockholder Say-on-Pay Votes
We provide our stockholders with the opportunity periodically to cast
an advisory vote on our executive compensation program (referred to as a say-on-pay vote). At our annual meeting of stockholders
held in June 2024, approximately 94.9% of the votes cast on the say-on-pay proposal were voted in favor of the proposal. After considering
the 2024 say-on-pay vote, including the compensation views expressed by our largest shareholders through regular outreach conducted by
management, the compensation committee reaffirmed the fundamental design and elements of our executive compensation program and did not
make any material changes to the structure of our executive compensation program. The board of directors and compensation committee will
continue to consider the outcome of our say-on-pay proposals and direct stockholder feed-back when making future compensation decisions
for the NEOs. At our 2022 annual meeting of stockholders which was held on June 21, 2022, a majority of stockholders present at the meeting
selected One Year for their preference as to how frequently we should seek future advisory votes on the compensation of
our named executive officers. As a result, we seek an advisory say-on-pay vote at each annual meeting of stockholders.
27
Design and Elements of Our Compensation
Program
The material elements of our current executive
compensation programs for NEOs consist primarily of the following:
We review peer group company data regarding the
mix of current and long-term incentive compensation and between cash and non-cash compensation, though we have not adopted any formal
policies or guidelines for allocations among these various compensation elements. However, consistent with our pay for performance philosophy,
we believe that a greater component of overall direct compensation for the NEOs relative to other employees should be performance-based.
Use of Peer Company Data
We periodically review the compensation practices
of our peer group companies identified below, and we consider the following factors: geographical region, company stage of development,
company size and market capitalization.
As a result of the Company having a combination
of multiple drug candidates in diverse therapeutic areas, a mix of wholly-owned and partnered drug candidates, and a technology platform
with the potential to enable multiple drug candidates in future years, it is very challenging to identify truly comparable companies.
The peers from which benchmark compensation information was reviewed
were of similar size and commercial stage. The Companys 2024 compensation decisions were made prior to the start of the year using
data from a 2022 study of similar companies with median 2022 market capitalization that was close to our 2022 market capitalization size
at the time the peers were chosen. Most peer companies reviewed in 2023 were drug development and vaccine companies, as follows:
AnaptysBio
Arbutus BioPharma
Cytokinetics
Editas
Epizyme
Geron
Heron Therapeutics
Inovio Pharmaceuticals
Kura Oncology
RegenXBio
Sangamo
Sorrento Therapeutics
Sutro BioPharma
Travere Therapeutics
Vaxart
Viking Therapeutics
WaVe Life Sci
The 2024 equity compensation decisions were made using updated peer
group data as context. During 2024, the outside compensation committee and F.W. Cook, facilitated determination of the composition of
our 2024 peer group used as market context for 2024 equity compensation decisions. The committee considered generally commercial stage
companies with broadly similar market capitalization to recognize the expected commercial sales of ARCT-154 that began in the fourth quarter
of 2024. The 2024 peer group of companies reviewed as context when determining 2024 equity compensation decisions and 2025 cash compensation
decisions consisted of the following companies:
28
We do not set compensation at any specific level or percentile based
solely on the peer group data, although we reviewed and discussed the compensation data for the peer group companies to help inform executive
compensation decisions. . The peer group data is used by us as only one reference point taken into account in making compensation decisions.
We do not use peer group or industry survey data as a standalone tool for setting compensation due to the unique aspects of our business
and the need to attract and retain particular highly qualified executives with unique experience, skills and other individual facts and
circumstances. However, we generally believe that reviewing and analyzing this information is an important component of our executive
compensation decision-making process.
The cash compensation of all NEOs in 2024 was
at or below the median of the 2024 compensation peer group and equity award values and total compensation values was also set below the
median of the 2024 peer group for all of the NEOs in this proxy.
Base Salary
Base salary provides NEOs with a specified minimum
level of cash compensation, which we believe is important to attract and retain their services. We determine base salary by considering
competitive pay practices, cost of labor and compensation trends, individual performance and promotions, level and scope of responsibility,
experience, internal pay equity, and our commercial stage. We do not use a formula or assign a particular weight to any one factor and
the determination of base salary levels is subjective.
There were no NEO salary increases in 2024 to conserve Company cash
and focus on long-term equity compensation. NEO 2024 salaries were frozen despite the expectation that ARCT-154 would begin commercial
sales in late 2024, which occurred.
Base salaries in 2023 for 2024 were as follows:
2023 Salary
($)
2024 Salary
($)
Change
Change
Short-Term Incentive Compensation
Incentive Compensation Policy.
We believe
that our short-term incentive compensation program (Incentive Compensation Policy) for the NEOs rewards the achievement
of important short-term objectives that advance us toward our long-term strategic objectives. Our Incentive Compensation Policy applies
to all executive officers. Consistent with our compensation philosophy of paying for performance and maintaining a flexible approach,
we use the Incentive Compensation Policy to incentivize the NEOs to achieve important corporate goals while at the same time encouraging
and rewarding excellent individual performance by recognizing and rewarding differences in performance between individual executives.
Plan Design.
The board of directors establishes
important annual corporate goals each year that include clinical development, research, manufacturing, organizational and financial goals
which we believe are essential to building long-term stockholder value and are used to assess annual corporate performance. The corporate
objectives are not weighted formally nor were they formally tied to a cash bonus plan in 2024, so there is a degree of qualitative judgment
in the final score.
After 2024 corporate performance was determined, the individual performance
and future contribution of NEOs was reviewed by the compensation committee in consultation with Mr. Payne (other than his own performance).
Mr. Paynes individual performance is separately reviewed by the compensation committee.
29
Target Annual Short-Term Incentive Compensation
for 2024.
The NEOs were each assigned a target annual incentive for 2024 ranging from 40% to 60% of base salary. The table below shows
the target annual incentive assigned by us to each NEO for 2024 both as a dollar amount and as a percentage of base salary.
Target
Annual
Incentive for
2024
($)
Target
Annual
Incentive for
2024
(% of Base
Salary)
Company Performance Objectives
.
The Companys 2024 corporate objectives were as follows:
Publish in a high impact peer-reviewed journal
30
Actual Annual Incentives Earned for 2024
The board of directors also recognized certain accomplishments directly
related to management efforts including those listed above in
Company Performance Highlights
.
The compensation committee, in consultation with Mr. Payne, determined
that the individual contribution of each NEO was critical to the Companys successful 2024 performance. Given the Companys
corporate objectives, bonuses for 2024 were paid to each of the NEOs as follows: 88% of Mr. Paynes target bonus, 83% of Dr. Chivukulas
target bonus, 95% of Mr. Sassines target bonus, and 90% of Mr. Kuratas target bonus. The amount of each NEOs bonus
for the 2024 fiscal year is reported in the Summary Compensation Table, and all were higher than the bonuses paid in the year prior.
Long-Term Incentive Compensation: Equity Awards
In accordance with our objective of aligning executive compensation
with our stockholders interests, our current long-term incentive program for the NEOs generally consists of an annual award of
equity compensation that is subject to a multi-year vesting or earn-out schedule. We believe that equity compensation is an effective
tool for aligning the interests of our NEOs with the interests of our stockholders. Stock options are our preferred form of long-term
incentive compensation because we believe they are inherently performance-based, with value delivered only if the price of our common
stock appreciates following the grant. The value of options reported as long-term incentive compensation awards to the NEOs during 2024
was lower than the value reported in the Summary Compensation Table of the 2023 proxy statement for all NEOs, and the grant values provided
to all NEOs was below the median of the 2024 compensation peer data available to the Company at the time awards were made.
Equity Compensation Policy
While we do not have a formal written policy in place with regard to
the timing of certain equity awards in relation to the disclosure of material nonpublic information, our Board and the compensation committee
of the Board do not seek to time equity grants to take advantage of information, either positive or negative, about our Company that has
not been publicly disclosed. It has been our practice generally to grant initial equity awards to our officers and non-employee directors
in connection with their hiring or appointment to the Board, as applicable. We generally intend to issue equity awards to our officers
at approximately the same time each year, typically in close proximity to the end of the fiscal year. In addition, non-employee directors
generally receive grants of initial and annual equity awards, at the time of a directors initial appointment or election to the
Board and at the time of each annual meeting of our stockholders, respectively, pursuant to our director compensation policy. Option grants
generally are effective on the date the award determination is made by the compensation committee or the Board, as the case may be, and
the exercise price of options is typically based upon the Fair Market Value of our common stock as defined in our 2019 Omnibus Equity
Incentive Plan, as amended and restated (the 2019 Plan).
During the fiscal year ended December 31, 2024, we did not award any
equity awards to a named executive officer in the period beginning four business days before the filing of a periodic report on Form 10-Q
or Form 10-K, or the filing or furnishing of a current report on Form 8-K that discloses material nonpublic information, and ending one
business day after the filing or furnishing of such report.
31
Severance and Change of Control Benefits
If the employment of an NEO is terminated by us
without cause or by the NEO for a designated good reason outside of the context of a change of control transaction, the NEO would be entitled
to severance benefits under his employment agreement with the Company. These severance benefits include a cash severance payment based
on the NEOs then-current base salary and a pro rata amount of his annual incentive bonus, and payment of COBRA premiums. In order
to attract and retain these NEOs in a competitive environment for highly skilled senior executive talent in the biotechnology and pharmaceutical
industry and to provide an incentive to obtain a broad release of claims in favor of the Company, we determined it was beneficial to offer
each of them severance protection in the case of a termination without cause or constructive termination outside the context of a change
of control transaction. These NEOs would also be entitled to certain termination benefits upon a termination of employment because of
death or disability.
In April 2021, after consulting with the compensation
committees independent compensation consultant, the Board adopted a written Severance Policy covering all senior executives of
the Company. Termination and change of control payments under the Severance Policy are without duplication of any severance payments provided
for in an individual employment agreement (such that the higher amount would apply). The primary changes effected by the Severance Policy
are to (i) implement new and more internally equitable amounts for cash severance, (ii) make certain clean-up changes to the severance
provisions in the NEOs employment agreements (the Employment Agreements), and (iii) require non-solicitation and
non-disparagement restrictive covenants as a condition of receiving severance.
Pursuant to the Severance Policy, the NEOs are
entitled to certain severance benefits if their employment is terminated in connection with a change of control. Severance benefits under
the Severance Policy are structured on a double-trigger basis, meaning that the executive must experience a termination
without cause or resign for a specifically defined good reason in connection with the change of control in order for severance benefits
to become payable under the Severance Policy. Like the severance benefits under the Employment Agreements, we believe that these change
of control severance benefits are an important element of a competitive total compensation program. Additionally, we believe that providing
change of control benefits should eliminate, or at least reduce, any reluctance of our NEOs and other key employees covered by the Severance
Policy to diligently consider and pursue potential change of control opportunities that may be in the best interests of our stockholders.
At the same time, by providing change of control benefits only upon the occurrence of an additional triggering event occurring in connection
with the change of control transaction resulting in a job loss, we believe that this Severance Policy helps preserve the value of our
key personnel for any potential acquiror.
Under the Severance Policy, the executive would
be entitled to accelerated equity award vesting if their employment is terminated within 18 months of a change of control. The other severance
benefits under the Severance Policy are generally similar to the severance benefits described above, provided that (i) the executive is
also entitled to a lump sum payment in an amount equal to his target annual bonus for the year of termination, (ii) pro-rata target bonus
for the year of termination, and (iii) Company-paid COBRA coverage is extended by several additional months.
The Potential Payments Upon Termination
or Change of Control section below describes and quantifies the severance and other benefits potentially payable to the NEOs.
Other Benefits
We believe that establishing competitive benefit
packages for employees is an important factor in attracting and retaining highly-qualified personnel, including the NEOs. The NEOs are
eligible to participate in all of our employee benefit plans, such as medical, dental, vision, group life, disability insurance, commuting
benefits, employee stock purchase plan and the 401(k) plan, in each case generally on the same basis as other employees. We do not offer
a tax-qualified defined-benefit pension plan or any non-qualified defined benefit retirement plans, nor do we provide material perquisites
to our executives.
Section 162(m) Policy
Generally, Section 162(m) of the Code (Section
162(m)) disallows a federal income tax deduction for public corporations of remuneration in excess of $1 million paid in any fiscal
year to certain specified executive officers. For taxable years beginning before January 1, 2018 (i) these executive officers consisted
of a public corporations chief executive officer and up to three other executive officers (other than the chief financial officer)
whose compensation is required to be disclosed to stockholders under the Exchange Act because they are our most highly-compensated executive
officers and (ii) qualifying performance-based compensation was not subject to this deduction limit if specified requirements
are met.
32
Pursuant to the Tax Cuts and Jobs Act of 2017,
which was signed into law on December 22, 2017 (the Tax Act), the remuneration of a public corporations chief financial
officer is also subject to the deduction limit. In addition, subject to certain transition rules (which apply to remuneration provided
pursuant to written binding contracts which were in effect on November 2, 2017 and which are not subsequently modified in any material
respect), for taxable years beginning after December 31, 2017, the exemption from the deduction limit for performance-based compensation
is no longer available. In addition, under the Tax Act, once an executive becomes a covered employee under Section 162(m),
the individual will continue to be a covered employee as long as he or she remains employed by the company. Consequently,
all remuneration in excess of $1 million paid to a covered executive will not be deductible unless it qualifies for transitional relief
applicable to certain binding, written performance-based compensation arrangements that were in place as November 2, 2017 or transitional
relief for applicable to certain newly public companies. These changes will cause more of our compensation to be non-deductible under
Section 162(m) and will eliminate the Companys ability to structure performance-based awards to be exempt from Section 162(m).
In designing our executive compensation program
and determining the compensation of our executive officers, including our named executive officers, the compensation committee considers
a variety of factors, including the potential impact of the Section 162(m) deduction limit. While the compensation committee is mindful
of the benefit of the full deductibility of compensation, it believes that we should not be constrained by the requirements of Section
162(m) where those requirements would impair our flexibility in compensating our executive officers in a manner that can best promote
our corporate objectives. Therefore, the compensation committee has not adopted a policy that would require that all compensation be deductible,
though it does consider the deductibility of compensation when making compensation decisions. The compensation committee may authorize
compensation payments that are not fully tax deductible if it believes that such payments are appropriate to attract and retain executive
talent or meet other business objectives.
Clawback Policy
We have adopted a written compensation
recovery policy in accordance with applicable Nasdaq rules, a copy of which is filed as an exhibit to our most recent Annual Report on
Form 10-K. The policy generally provides that we will seek to recover any incentive-based compensation erroneously awarded to any current
or former executive officer due to material noncompliance with any financial reporting requirement under the securities laws during the
three completed fiscal years immediately preceding the date we determine that an accounting restatement is required.
Processes and Procedures for Executive Compensation
Our compensation committee assists the Board
in discharging its responsibilities relating to oversight of the compensation of our chief executive officer and our other executive officers,
including reviewing and making recommendations to our Board with respect to the compensation, plans, policies and programs for our chief
executive officer and our other executive officers and administering our equity compensation plans for our executive officers and employees.
Our compensation committee annually reviews
the compensation, plans, policies and programs for our chief executive officer and our other executive officers. In connection therewith,
our compensation committee considers, among other things, each executive officers performance in light of established individual
and corporate goals and objectives and the recommendations of our chief executive officer. In particular, our compensation committee considers
the recommendations of our chief executive officer when reviewing base salary and incentive compensation levels of our executive officers
and when setting specific individual and corporate performance guidelines under our annual executive incentive bonus plan. Our chief executive
officer has no input and is not present during voting or deliberations about his own compensation. Our compensation committee may delegate
its authority to a subcommittee, but it may not delegate any power or authority required by agreement, law, regulation or listing standard
to be exercised by the compensation committee as a whole.
Our nominating and corporate governance committee
has authority to review and recommend to the Board compensation programs for our outside directors, although this role has been predominantly
undertaken by our compensation committee, in consultation with members of our full Board. Management generally does not have a role in
the setting of director compensation. Our nominating and corporate governance committee may delegate its authority to a subcommittee,
but it may not delegate any power or authority required by agreement, law, regulation or listing standard to be exercised by the nominating
and corporate governance committee as a whole.
33
Summary Compensation Table
Our named executive officers (NEOs)
for the year ended December 31, 2024, which consist of all individuals who served as our principal executive officer and principal financial
officer during 2024 and our two other most highly compensated executive officers who were serving as executive officers at the end of
the last completed fiscal year, are Joseph E. Payne, our President and Chief Executive Officer; Dr. Padmanabh Chivukula, our Chief Scientific
Officer and Chief Operating Officer; Andy Sassine, our Chief Financial Officer, and Lance Kurata, our Chief Legal Officer.
(1) Bonuses in this column were the cash bonuses
approved by the Board and/or compensation committee of the Board after reviewing completion and progress against the corporate goals for
2024.
(2) Amounts shown in this column do not
reflect take-home or salable value from the options granted, but rather reflects a theoretical present value of the grant opportunity
computed in accordance with FASB ASC 718. The actual economic value that may be realized by the applicable NEO could be quite different
than the amounts shown and is currently not equal to the amounts shown. Includes the value of stock options determined using the grant
date fair value computed in accordance with FASB ASC 718. See Note 2 to the consolidated financial statements of the Company for the fiscal
years ended December 31, 2022, December 31, 2023, and December 31, 2024 in the Form 10-K filed by the Company on March 6, 2025, for additional
description of the assumptions used in the valuation.
2024 GRANTS OF PLAN-BASED AWARDS
The following table provides
certain information regarding the December 2024 options which represent equity awards approved and granted to our named executive officers
during the fiscal year ended December 31, 2024. These equity awards were granted under the Amended and Restated 2019 Omnibus Equity Incentive
Plan, as amended.
(1) Represents the grant date and approval date fair values of option
awards granted during the fiscal years ended December 31, 2024, calculated in accordance with FASB ASC Topic 718.
34
2024 OPTION EXERCISES AND STOCK VESTED
None of the NEOs exercised any options during the fiscal year ended
December 31, 2024. None of the NEOs held any restricted stock awards during the fiscal year ended December 31, 2024.
Current Agreements With Our Named Executive Officers
The termination and change of control
payments provided for under the employment agreements summarized below are without duplication of any severance payments provided for
under the Companys Severance Policy (such that the higher amount would apply). For a summary of the Severance Policy, see
Severance
and Change of Control Benefits
. The annual base salary amounts and performance bonus targets provided for under the employment
agreements, summarized below, are subject to increase upon approval by the compensation committee of the Board as described elsewhere
in this proxy statement. See Base Salary and Short-Term Incentive Compensation.
Joseph E. Payne
On June 13, 2019, we entered into an Employment
Agreement (the Payne Agreement) with Joseph E. Payne, our President and Chief Executive Officer. The Payne Agreement provides
for the following compensation and benefits to Mr. Payne:
Andy Sassine
On June 13, 2019, we entered into an Employment
Agreement (the Sassine Agreement) with Andy Sassine, our Chief Financial Officer. The Sassine Agreement provides for the
following compensation and benefits to Mr. Sassine:
35
Dr. Padmanabh Chivukula
On June 13, 2019, we entered into an Employment
Agreement (the Chivukula Agreement) with Dr. Padmanabh Chivukula, our Chief Scientific Officer and Chief Operating Officer.
The Chivukula Agreement provides for the following compensation and benefits to Dr. Chivukula:
Lance Kurata
On July 10, 2020, we
entered into an Employment Agreement (the Kurata Agreement) with Lance Kurata, our Chief Legal Officer. The Kurata Agreement
provides for the following compensation and benefits to Mr. Kurata:
36
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE
IN CONTROL
See
Current Agreements With Our Named
Executive Officers
for a description of the circumstances that would trigger payments or the provision of other benefits to
each of our named executive officers in connection with their termination without cause or resignation for good reason in connection with
a change in control. See
Termination and Change of Control Potential Payments and Benefits Table
for details on the
amounts of such payments.
Under the employment agreements with our named
executive officers, good reason constitutes a resignation from employment with the Company in connection with the occurrence
of any of the following without the executives prior written consent: (i) a material reduction in the executives base salary,
unless pursuant to a salary reduction program applicable generally to the Companys senior executives; (ii) a material reduction
in the executives duties (including responsibilities and/or authorities), provided that (A) a change in job position (including
a change in title) shall not be deemed a material reduction in and of itself unless the executives new duties are
materially reduced from the prior duties, and (B) a reduction in duties which results from the hiring of an individual not previously
employed by the Company to serve as its President and/or Chief Executive Officer shall not be deemed a material reduction
(e.g., where an executive undertakes temporary additional responsibilities until a President and/or Chief Executive Officer is appointed);
or (iii) relocation of the executives principal place of employment to a place that increases the executives one-way commute
by more than 50 miles as compared to the executives then-current principal place of employment immediately prior to such relocation.
In order for an executive to resign for good reason,
each of the following requirements must be met: (i) the executive must provide written notice to the Board within 30 days after the first
occurrence of the event giving rise to good reason setting forth the basis for the executives resignation, (ii) the executive must
allow the Company at least 30 days from receipt of such written notice to cure such event, (iii) such event is not reasonably cured by
the Company within such 30 day period (the Cure Period), and (iv) the executive must resign from all positions the executive
then holds with the Company not later than 30 days after the expiration of the Cure Period.
Effective May 1, 2021, the Board adopted a written
Severance Policy covering all senior executives of the Company. Termination and change of control payments under the Severance Policy
will not duplicate any severance payments provided for in an individual employment agreement (such that the higher amount would apply).
For a summary of the Severance Policy, see Severance and Change of Control Benefits. Pursuant to the Severance Policy, in
order to receive any payments upon a termination or change of control, our named executive officers must execute a general release of
all known and unknown claims, as drafted in the Companys discretion, in a severance agreement acceptable to the Company within
the applicable deadline set forth therein, but in no event later than twenty-one days following the executives termination date,
and permit the release to become effective and irrevocable in accordance with its terms.
37
Options granted to our officers and certain of
our directors may contain acceleration provisions upon certain merger, acquisition, or change of control transactions. If the relationship
between us and an executive officer or a director is terminated, except for cause (as defined in the various option plan agreements),
options that are vested will generally remain exercisable for ninety days or thirty-six months after such termination depending on whether
the options were granted to an executive officer or director. Generally, any benefits conferred on an executive officer as a result of
a change of control require such officer to execute a signed and dated general release of known and unknown claims in a termination agreement
acceptable to the Company.
TERMINATION AND CHANGE OF CONTROL POTENTIAL PAYMENTS AND BENEFITS
TABLE
The amounts disclosed in the table below are based
on the payments and benefit costs that would have been incurred by the Company if the named executive officer's employment had terminated
as of the last business day of the fiscal year ended December 31, 2024. The amounts included below do not include payments and benefits
to the extent they are provided on a non-discriminatory basis to salaried employees generally upon termination of employment. Where applicable,
the value of one of our shares of common stock on December 31, 2024 was $16.97, which was the closing market price of our common stock
on the Nasdaq on such date.
38
Involuntary Termination without Cause or Resignation for Good Reason
(1)
($)
Accelerated
($)
7,356,495
7,356,495
2,789,444
2,789,444
3,319,756
3,319,756
2,715,200
2,715,200
39
(1) See above in
Potential Payments
Upon Termination or Change in Control
for the definition of good reason under the employment agreements with our
NEOs.
(2) Under the Severance Policy, the NEOs are entitled
to accelerated equity award vesting if their employment is terminated or they resign for good reason within 18 months of a change of control.
(3) For Cash Severance, amount represents the
payment of an amount equal to 12 months of the employees annual base salary, as well as (i) for involuntary termination without
cause or resignation for good reason not in connection with a change of control, a lump sum payment of the pro rata portion of the executives
annual bonus for the year of termination or resignation based actual performance (a Performance Bonus), and (ii) for involuntary
termination without cause or resignation with good reason in connection with a change of control, a Performance Bonus and a lump sum payment
in an amount equal to the executives target annual bonus for the year of termination or resignation (a Target Bonus).
For Health and Welfare, amount represents the
estimated value of providing the employee and their dependents with health benefits for 12 months following the date of termination or
resignation for good reason. This amount is calculated based on the current market rate of COBRA premiums in California.
(4) For Cash Severance, amount represents the
payment of an amount equal to 18 months of the employees annual base salary, as well as (i) for involuntary termination without
cause or resignation for good reason not in connection with a change of control, a Performance Bonus, and (ii) for involuntary termination
without cause or resignation with good reason in connection with a change of control, a Performance Bonus and a Target Bonus.
For Health and Welfare, amount represents the
estimated value of providing the employee and their dependents with health benefits for 18 months following the date of termination or
resignation for good reason. This amount is calculated based on the current market rate of COBRA premiums in California.
(5) For Equity Treatment, amount represents the
estimated value of accelerated vesting of stock options subject to outstanding stock options upon a termination or resignation for good
reason prior to December 31, 2024.
CEO PAY RATIO
For 2024, Mr. Paynes total annual compensation as disclosed
in the Summary Compensation Table was $3,697,000, and the total annual compensation for our median employee was $269,150, resulting in
a pay ratio of 13.7 (the Pay Ratio).
To identify the median employee and calculate
the annual total compensation of the median-paid employee, we determined (i) the total number of part-time and full-time individuals employed
at any point during fiscal year 2024, and (ii) the sum of the salary, bonus, and share-based compensation incurred for each employee.
We believe the pay ratio reported above is a reasonable
estimate calculated in a manner consistent with SEC rules based on our internal records and the methodology described above. Because the
SEC rules for identifying the median compensated employee and calculating pay ratio allow companies to adopt a variety of methodologies,
apply certain exclusions, and make reasonable estimates and assumptions that reflect their employee populations and compensation practices,
our pay ratio may not be comparable to the pay ratios reported by other companies.
40
Results
The table below shows the information used for
the calculation of the ratio of the estimated annual total compensation of the median employee identified using the methodology described
above to the annual total compensation of Mr. Payne as calculated for the Summary Compensation Table.
2,635,000
3,697,000
167,000
25,000
39,000
231,000
Ratio of Median Employees to Mr.
Paynes Annual Total Compensation
Pay Versus Performance Disclosure
In accordance with rules adopted by the Securities and Exchange Commission
pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, we provide the following disclosure regarding executive
compensation for our principal executive officer (PEO) and Non-PEO NEOs and Company performance for the fiscal years listed
below. For the most recently completed fiscal year, we did not use any financial performance measure to link Compensation Actually Paid
to our NEOs to the Companys performance; accordingly, this disclosure does not present a company-selected measure in the table
below nor a tabular list of our most important performance measures, as permitted under the rules promulgated by the Securities and Exchange
Commission. The Compensation Committee did not consider the pay versus performance disclosure below in making its pay decisions for any
of the years shown.
115.42
156.03
111.27
340.48
124.89
6,286,144
Dr. Padmanabh
Chivukula
Dr. Padmanabh
Chivukula
Dr. Padmanabh
Chivukula
Dr. Padmanabh
Chivukula
Dr. Padmanabh
Chivukula
Lance Kurata
41
(11,911,500)
The amounts in the Inclusion of Equity Values in the tables above are
derived from the amounts set forth in the following tables:
2,564,309
42
Description of Relationship Between PEO and Non-PEO NEO Compensation
Actually Paid and Company Total Shareholder Return (TSR)
The following chart sets forth the relationship between Compensation
Actually Paid to our PEO, the average of Compensation Actually Paid to our Non-PEO NEOs, and the Companys cumulative TSR over the
three most recently completed fiscal years.
43
Description of Relationship
Between PEO
and Non-PEO NEO Compensation
Actually Paid and Net Income
The following chart sets forth the relationship between Compensation
Actually Paid to our PEO, the average of Compensation Actually Paid to our Non-PEO NEOs, and our Net Income during the three most recently
completed fiscal years.
Outstanding Equity Awards at Fiscal Year-End
for Fiscal 2024
The following table sets forth certain information regarding all outstanding
equity awards held by our named executive officers as of December 31, 2024. None of the outstanding equity awards shown in the table below
have been exercised or forfeited as of December 31, 2024. None of our named executive officers held any other equity awards from the Company
as of December 31, 2024.
44
(1) The option award vests 25% on the one-year anniversary
of the date of grant, with the remainder vesting in 36 successive equal monthly increments thereafter.
45
Pension Benefits
None of our named executive officers participate
in or have account balances in qualified or non-qualified defined benefit plans sponsored by us.
Non-Qualified Deferred Compensation
None of our named executive officers participate
in or have account balances in qualified or non-qualified defined contribution plans or other non-qualified compensation plans sponsored
by us.
Perquisites, Health, Welfare and Retirement Benefits
Our named executive officers are eligible to
participate in our employee benefit plans, including our medical, dental, vision, group life, disability and accidental death and dismemberment
insurance plans, in each case on the same basis as all of our other employees. We provide a 401(k) savings plan to our employees, including
our current named executive officers, as discussed in the section below entitled
401(k) Plan
.
We generally do not provide perquisites or personal
benefits to our named executive officers, except in limited circumstances and as noted in the Summary Compensation Table above. Our Board
may elect to adopt qualified or non-qualified benefit plans in the future if it determines that doing so is in our best interests.
401(k) Plan
We maintain a tax-qualified retirement plan
that provides eligible employees, including named executive officers, with an opportunity to save for retirement on a tax advantaged basis.
All participants interests in their deferrals are 100% vested when contributed. Pre-tax and after-tax contributions are allocated
to each participants individual account and are then invested in selected investment alternatives according to the participants
directions. Currently, we match $0.50 for every $1.00 on the first $5,000.00 of contributions made by the employee with an annual maximum
match of $2,500. The 401(k) plan is intended to qualify under Sections 401(a) and 501(a) of the Internal Revenue Code. As a tax-qualified
retirement plan, contributions to the 401(k) plan and earnings on those contributions are not taxable to the employees until distributed
from the 401(k) plan, and all matching contributions, if any, are deductible by us when made.
2021 Inducement Equity Incentive Plan
In October 2021, the Company adopted the 2021
Inducement Equity Incentive Plan which covered the award of up to 1,000,000 shares of common stock (the 2021 Inducement Plan)
effective as of October 15, 2021. Only newly-hired employees are eligible to receive awards under the 2021 Inducement Plan. Approval of
the Companys stockholders is not required as a condition to the effectiveness of the 2021 Plan for so long as the plan is in compliance
with Nasdaq inducement plan rules. On October 20, 2021, the Company filed a registration statement on Form S-8 with the United States
Securities and Exchange Commission to register 1,000,000 awards. In April 2022, the number of shares available for grant under the 2021
Inducement Plan was reduced to 130,000. As of December 31, 2024, a total of 124,697 shares remained available for future issuance under the
2021 Inducement Plan, subject to the terms of the 2021 Inducement Plan.
46
Equity Compensation Plans
On June 14, 2024, the stockholders
of the Company approved the 2019 Plan Amendment, amending the 2019 Plan. The 2019 Plan Amendment (i) increases the maximum
number of shares of common stock available to 2019 Plan participants by 2,000,000 shares to an aggregate of 10,750,000 shares.
The following information is provided as of December
31, 2024 with respect to our equity compensation plans:
8,976,912
30.76
1,060,695
8,976,912
30.76
1,060,695
Compensation Committee Report
The compensation committee has reviewed and
discussed the foregoing
Executive Compensation
section of this proxy statement, including the
Compensation
Discussion and Analysis
, with management. Based on this review and discussion, the compensation committee recommended to our
Board that such information be included in this proxy statement.
Dr. Magda Marquet
James Barlow
Dr. Jing L. Marantz
The information contained in the Compensation
Committee Report shall not be deemed to be soliciting material or to be filed with the SEC, nor shall such information be incorporated
by reference into any future filing under the Securities Act or the Exchange Act, except to the extent that Arcturus specifically incorporates
it by reference in such filing.
47
RELATED PARTY TRANSACTIONS
Related Party Transactions Policy and
Procedures
We have adopted a policy with respect to the review,
approval, and ratification of related party transactions. Under the policy, the Audit Committee is responsible for the identification,
review, consideration and approval or ratification of related person transactions. A related person includes directors, executive officers,
beneficial owners of 5% or more of any class of our voting securities, immediate family members of any of the foregoing persons, and any
entities in which any of the foregoing is an executive officer or is an owner of 5% or more ownership interest.
If a transaction has been identified as a related
person transaction, including any transaction that was not a related person transaction when originally consummated or any transaction
that was not initially identified as a related person transaction prior to consummation, information regarding the related person transaction
must be reviewed and approved by the audit committee
In considering related person transactions, our
audit committee takes into account the relevant available facts and circumstances including, but not limited to:
In determining whether to approve, ratify or reject
a related person transaction, the audit committee reviews all relevant information available to it about such transaction, and it may
approve or ratify the related person transaction only if it determines that, under all of the circumstances, the transaction is in, or
is not inconsistent with, the best interests of the Company.
There have been no transactions during the year ended December 31,
2024 involving an amount in excess of $120,000 to which the Company has been a participant and in which any of its directors, executive
officers or holders of more than 5% of its share capital, or any members of their immediate family, had or will have a direct or indirect
material interest, other than compensation arrangements which are described under Executive Compensation and Director
Compensation.
48
SECURITY
OWNERSHIP
The following table sets forth information with respect to the beneficial
ownership of our common stock as of April 8, 2025 by:
The beneficial ownership of shares of common stock is determined in
accordance with the rules of the SEC and generally includes any shares of common stock over which a person exercises sole or shared voting
or investment power, or the right to receive the economic benefit of ownership. For purposes of the table below, we deem shares subject
to options or warrants that are currently exercisable or exercisable within 60 days of April 8, 2025, to be outstanding and to be beneficially
owned by the person holding the options or warrants for the purposes of computing the percentage ownership of that person, but we do not
treat them as outstanding for the purpose of computing the percentage ownership of any other person. The percentage of shares beneficially
owned is based on April 8, shares of common stock outstanding as of April 8, 2025.
The following table sets forth information regarding
the beneficial ownership by each person or entity known to beneficially own more than 5% of our common stock as of April 8, 2025. Except
as indicated in footnotes to this table, we believe that the stockholders named in this table have sole voting and investment power with
respect to all shares shown to be beneficially owned by them, based on information provided to us by such stockholders. Unless otherwise
noted below, each beneficial owners address is: c/o Arcturus Therapeutics Holdings Inc., 10628 Science Center Drive, Suite 250,
San Diego, California, 92121.
49
Shares of Common Stock Beneficially Owned
50
* Less than 1%.
51
OTHER
MATTERS
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our
executive 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 of ownership on Forms 3, 4 and 5 with the SEC. Such directors, executive officers and 10% stockholders are required
by SEC regulations to furnish us with copies of all Section 16(a) forms they file.
Based solely on our review
of the copies of such forms we have received and written representations from certain reporting persons that they filed all required reports,
we believe that all of our officers, directors and 10% stockholders complied with all Section 16(a) filing requirements applicable to
them with respect to transactions during 2024.
Fiscal Year 2024 Annual Report
Our financial statements for our fiscal year
ended December 31, 2024 are included in our 2024 annual report, which we will make available to stockholders at the same time as this
proxy statement. This proxy statement and our 2024 annual report are posted on our website at http://www.arcturusrx.com at the website
of the SEC at www.sec.gov.
You may also obtain a copy of our 2024 annual report without charge by sending a written request to us at
Arcturus Therapeutics Holdings Inc., 10628 Science Center Drive, Suite 250, San Diego, California 92121, Attention: Investor Relations.
Company Website
We maintain a website at http://www.arcturusrx.com.
Information contained on, or that can be accessed through, our website is not intended to be incorporated by reference into this proxy
statement.
52
PROPOSALS
OF STOCKHOLDERS FOR 2026 ANNUAL MEETING
Stockholder Proposals for Inclusion in Proxy Statement
Stockholders may present proper
proposals for inclusion in our proxy statement and for consideration at the next annual meeting of stockholders by submitting their proposals
in writing to our corporate secretary in a timely manner. For a stockholder proposal to be considered for inclusion in our proxy statement
for our next annual meeting of stockholders, our corporate secretary must receive the written proposal at our principal executive offices
not later than the close of business on December 27, 2025. In addition, stockholder proposals must comply with the requirements of Rule
14a-8 under the Exchange Act regarding the inclusion of stockholder proposals in company- sponsored proxy materials. Proposals should
be addressed to:
Arcturus Therapeutics Holdings Inc.
Stockholder Proposals and Director Nominations Not for Inclusion
in Proxy Statement
Our bylaws also establish an advance notice
procedure for stockholders who wish to (i) present a proposal before an annual meeting of stockholders, but do not intend for the proposal
to be included in our proxy statement or (ii) nominate directors for election at an annual meeting of stockholders. In addition to satisfying
all the requirements under the Companys bylaws, to comply with the SECs new universal proxy rules for the Companys
2025 annual meeting, stockholders who intend to solicit proxies in support of director nominees other than the Companys nominees
must provide notice that sets forth all of the information required by Rule 14a-19 under the Exchange Act, the stockholder must have given
timely notice of such proposal or nomination, in proper written form. If the stockholder does not also comply with the requirements of
Rule 14a-4(c)(2) under the Exchange Act, we may exercise discretionary voting authority under proxies that we solicit to vote in accordance
with our best judgment on any such stockholder proposal or nomination. To make a submission or to request a copy of our amended and restated
bylaws, stockholders should contact our Corporate Secretary. To be timely for our 2026 annual meeting of stockholders, a stockholders
notice of a matter that the stockholder wishes to present, or the person or persons the stockholder wishes to nominate as a director,
must be delivered to the corporate secretary at Arcturus principal executive offices not less than 45 days and not more than 75
days prior to the first anniversary of the date of the mailing of the materials for the preceding years annual meeting of stockholders.
As a result, any written notice given by a stockholder pursuant to these provisions of our bylaws must be received by our corporate secretary
at our principal executive offices:
In the event that we hold our 2026 annual meeting
of stockholders more than 30 days before or more than 30 days after the one-year anniversary date of the 2025 annual meeting, then such
written notice must be received no later than the close of business on the later of the following two dates:
53
To be in proper written form, a stockholders
notice must include the specified information concerning the proposal or nominee as described in our bylaws. Notices should be addressed
to:
Arcturus Therapeutics Holdings Inc.
For additional information regarding stockholder
recommendations for director candidates, please see the section entitled Requirements for Stockholder Recommendations of a Candidate
to our Board.
*********
We know of no other matters to be submitted
at the 2025 annual meeting. If any other matters properly come before the 2025 annual meeting, it is the intention of the persons named
in the proxy to vote the shares they represent as the Board may recommend. Discretionary authority with respect to such other matters
is granted by a properly submitted proxy.
It is important that your shares be represented
at the 2025 annual meeting, regardless of the number of shares that you hold. You are, therefore, urged to vote as promptly as possible
to ensure your vote is recorded.
THE BOARD OF DIRECTORS
San Diego, California
54
YOUR VOTE IS IMPORTANT.
PLEASE VOTE TODAY.
Vote
by Internet - QUICK
IMMEDIATE - 24 Hours
a Day, 7 Days a Week or by Mail
ARCTURUS THERAPEUTICS
Your Internet vote authorizes the named proxies to vote your shares in the same manner as if you marked, signed and returned your
proxy card. Votes submitted electronically over the Internet must be received by 11:59 p.m., Eastern Time, on June 5, 2025.
www.cstproxyvote.com
PLEASE DO NOT RETURN THE PROXY CARD
IF
YOU ARE VOTING ELECTRONICALLY.
PROXY
Please
mark
your
votes like this
☒
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY THE UNDERSIGNED STOCKHOLDER. IF NO INSTRUCTIONS ARE GIVEN,
THIS PROXY WILL BE VOTED FOR THOSE NOMINEES AND THE PROPOSALS LISTED BELOW. DISCRETIONARY VOTING IS HEREBY CONFERRED AS TO CERTAIN MATTERS
DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH NOMINEE AND FOR
PROPOSALS 2 AND 3.
Approval, by non-binding advisory vote, of the resolution approving the Companys Named Executive Officer compensation, as provided
in Proposal Number 2 of the Proxy Statement.
FOR
☐
AGAINST
ABSTAIN
(1)
Dr. Peter Farrell
(2)
Joseph E. Payne
(3)
Andy Sassine
(4)
James Barlow
(5)
Dr. Edward W. Holmes
(6)
Dr. Magda Marquet
(7)
Dr. Jing L. Marantz
(8) Dr. John Markels
(9) Dr. Moncef Slaoui
FOR
all Nominees listed to
the left
WITHHOLD AUTHORITY
to
vote (except as marked to
the contrary for all nominees listed to the left)
☐
FOR
☐
AGAINST
☐
ABSTAIN
☐
Note: Please sign exactly as your name appears on this Proxy. When shares are held jointly, each holder should sign. When signing as an
executor, administrator, trustee, or guardian, please give the full title as such. If the signer is a corporation, please sign the full
corporate name by a duly authorized officer, giving full title as such. If the signer is a partnership, please sign in partnership name
by authorized person.
Important Notice Regarding the Internet Availability of Proxy
Materials for the Annual Meeting of Stockholders
to be held Friday, June
6, 2025
To view the 2025 Proxy Statement and
the 2024 Annual Report please go to:
https://www.cstproxy.com/arcturusrx/2025
PROXY
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD JUNE 6, 2025
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ARCTURUS
THERAPEUTICS HOLDINGS INC.
The
undersigned appoints Joseph E. Payne and Andy Sassine, and each of them, agents and proxies of the undersigned, with full power of substitution
to each of them, to represent and to vote on behalf of the undersigned all the Common Stock of Arcturus Therapeutics Holdings Inc. (the
Company) which the undersigned is entitled to vote at the Annual Meeting of Stockholders (the Meeting) to
be held at 9:00 a.m. (Pacific Time) on Friday, June 6, 2025, and at any adjournments or postponements thereof, upon the following matters
on the reverse side, which are more fully described in the Proxy Statement relating to the Meeting.
(Continued,
and to be marked, dated and signed, on the other side)
For the 2025 Annual Meeting of Stockholders
to be held on June 6, 2025
ABOUT THE PROXY MATERIALS AND ANNUAL MEETING
You may vote by mail. Complete, sign and date the proxy card that accompanies this proxy statement and return it promptly in the postage-prepaid envelope provided. Your completed, signed and dated proxy card must be received prior to the annual meeting.
You may vote via the Internet. To vote via the Internet, go to www.cstproxyvote.com to complete an electronic proxy card (have your proxy card in hand when you visit the website). You will be asked to provide the company number and control number from your proxy card. Internet voting is available 24 hours a day, 7 days a week, until 11:59 p.m., Eastern time, on June 5, 2025.
the election of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet, Dr. Jing L. Marantz, Dr. John H. Markels, and Dr. Moncef Slaoui to the Board, to serve until our next annual meeting of stockholders;
the approval, by non-binding advisory vote, of the resolution approving named executive officer compensation (the Say on Pay Proposal); and
the ratification of the appointment of Deloitte Touche LLP (Deloitte) as our independent registered public accounting firm for our fiscal year ending December 31, 2025.
FOR
the election of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet, Dr. Jing L. Marantz, Dr. John H. Markels, and Dr. Moncef Slaoui to the Board;
FOR
the Say on Pay Proposal; and
FOR
the ratification of the appointment of Deloitte as our independent registered public accounting firm for our fiscal year ending December 31, 2025.
entering a new vote over the Internet (until the applicable deadline set forth above);
returning a later-dated proxy card (which automatically revokes the earlier proxy);
providing a written notice of revocation to our corporate secretary at Arcturus Therapeutics Holdings Inc., 10628 Science Center Drive, Suite 250, San Diego, California 92121, Attn: Corporate Secretary; or
attending the annual meeting and voting virtually.
FOR
the election of Dr. Peter Farrell, Joseph E. Payne, Andy Sassine, James Barlow, Dr. Edward W. Holmes, Dr. Magda Marquet, Dr. Jing L. Marantz, Dr. John H. Markels, and Dr. Moncef Slaoui to the Board;
FOR
the Say on Pay Proposal; and
FOR
the ratification of the appointment of Deloitte as our independent registered public accounting firm for our fiscal year ending December 31, 2025.
Attention: Investor Relations
10628 Science Center Drive, Suite 250
San Diego, California 92121
Name
Age
Position(s)
Director Since
Dr. Peter Farrell
82
Chairman of the Board
May 2018
Joseph E. Payne
53
President, Chief Executive Officer and Director
March 2013
Andy Sassine
60
Chief Financial Officer and Director
May 2018
James Barlow
66
Director
May 2018
Dr. Edward W. Holmes
84
Director
September 2019
Dr. Magda Marquet
66
Director
May 2018
Dr. Jing L. Marantz
59
Director
December 2021
Dr. John H. Markels
60
Director
December 2022
Dr. Moncef Slaoui, Ph.D.
65
Director
June 2024
oversees the work of our independent auditors;
approves the hiring, discharging and compensation of our independent auditors;
approves engagements of the independent auditors to render any audit or permissible non-audit services;
reviews the qualifications, independence and performance of the independent auditors;
reviews our financial statements and our critical accounting policies and estimates;
reviews the adequacy and effectiveness of our internal controls;
reviews our policies with respect to risk assessment and risk management;
reviews and monitors our policies and procedures relating to related person transactions;
reviews and discusses with management and the independent auditors the results of our annual audit, our quarterly financial statements and our publicly filed reports; and
fulfills our Boards oversight responsibility with respect to our cybersecurity policies, overseeing our risk management with respect to cybersecurity, reviewing our adoption and implementation of systems, controls and procedures designed to prevent, detect and respond to cyber-attacks or security breaches involving us, and reviewing our cybersecurity insurance requirements.
reviews and recommends for Board approval policies, plans and arrangements relating to compensation and benefits of our officers and employees;
reviews and recommends for Board approval corporate goals and objectives relevant to the compensation of our Chief Executive Officer and other executive officers;
evaluates the performance of our executive officers in light of established goals and objectives;
recommends compensation of our executive officers based on its evaluations;
reviews director compensation levels and practices, and recommends, from time to time, changes in such compensation levels and practices to the Board;
reviews and discusses with management the compensation disclosures required by SEC rules;
engages a compensation consultant, legal counsel or other external advisors to advise on executive compensation and assess the independence of executive officers in accordance with Nasdaq;
evaluates whether any compensation consultant, legal counsel or other external advisor has a conflict of interest in accordance with the SEC rules; and
prepares the annual compensation committee report required by SEC rules.
evaluates and makes recommendations regarding the organization and governance of our Board and its committees;
assesses the performance of members of our Board and makes recommendations regarding committee and chair assignments;
recommends desired qualifications for Board membership and conducts searches for potential members of our Board; and
reviews and makes recommendations with regard to our corporate governance guidelines.
The current size and composition of our Board and the needs of the Board and its respective committees;
Factors such as character, integrity, judgment, diversity of experience, independence, area of expertise, corporate experience, length of service, potential conflicts of interest, other commitments, and the like. Our nominating and corporate governance committee evaluates these factors, among others, and does not assign any particular weighting or priority to any of these factors; and
Other factors that our nominating and corporate governance committee may consider appropriate.
The highest levels of personal and professional ethics and integrity;
Proven achievement and competence in the nominees field and the ability to exercise sound business judgment;
Skills that are complementary to those of the existing Board;
The ability to assist and support management and make significant contributions to our success; and
An understanding of the fiduciary responsibilities required of a member of the Board and the commitment of time and energy necessary to diligently carry out those responsibilities.
Fees Earned
or Paid in
Option
All Other
Name
Cash ($)
Awards ($) (1)
Compensation ($)
Total ($)
Dr. Peter Farrell
65,000
309,000
374,000
Mr. James Barlow
65,000
309,000
374,000
Dr. Magda Marquet
52,500
309,000
361,500
Dr. Edward W. Holmes
57,500
309,000
366,500
Dr. Jing L. Marantz
57,500
309,000
366,500
Dr. John H. Markels
47,500
309,000
356,500
Dr. Moncef Slaoui
60,000
519,000
579,000
(1)
Represents annual option awards, which vest as set forth below in
Annual Equity Grants
.
ELECTION OF DIRECTORS
TO APPROVE, BY NON-BINDING ADVISORY VOTE, THE RESOLUTION APPROVING THE COMPANYS NAMED EXECUTIVE OFFICER COMPENSATION
RATIFICATION OF APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
(US Dollars in thousands)
2024
2023
Audit fees(1)
$
989
$
Audit-related fees
Tax fees(2)
184
139
All other fees(3)
79
68
Total
$
1,252
$
207
(1)
Includes fees for professional services rendered by our principal accountant in
connection with the audit of our consolidated annual financial statements and services that would normally be provided by our principal
accountant in connection with statutory and regulatory filings or engagements.
(2)
Tax fees are fees for services rendered by our respective principal accountants
in connection with tax compliance, tax planning and tax advice.
(3)
Primarily relates to Sarbanes-Oxley Act of 2002 analysis, received in 2024 but pertaining
to financial statements for the year ended December 31, 2023.
(US Dollars in thousands)
2024
2023
Audit fees(1)
$
$
1,345
Audit-related fees
Tax fees(2)
17
All other fees(3)
140
Total
$
140
$
1,362
(1)
Includes fees for professional services rendered by our principal accountant in
connection with the audit of our consolidated annual financial statements and services that would normally be provided by our principal
accountant in connection with statutory and regulatory filings or engagements.
(2)
Tax fees are fees for services rendered by our respective principal accountants
in connection with tax compliance, tax planning and tax advice.
(3)
Primarily relates to services rendered in connection with Registration Statements
on Form S-8.
reviewed and discussed the audited financial statements for fiscal year 2024 with the management of Arcturus;
discussed with Deloitte, Arcturus independent registered public accounting firm for fiscal year 2024, the matters required to be discussed by Auditing Standard No. 16, Communications with Audit Committees, as amended (AICPA, Professional Standards, Vol. 1, section 380), and as adopted by the PCAOB in Rule 3200T; and
received the written disclosures and the letter from Deloitte as required by applicable requirements of the PCAOB regarding Deloittes communications with the audit committee concerning independence, and has discussed with Deloitte its independence.
Name
Age
Position(s)
Joseph E. Payne
53
President and Chief Executive Officer
Andy Sassine
60
Chief Financial Officer
Dr. Padmanabh Chivukula
46
Chief Scientific Officer and Chief Operating Officer
Lance Kurata
55
Chief Legal Officer
Name
Title
Joseph E. Payne
President and Chief Executive Officer
Dr. Padmanabh Chivukula
Chief Scientific Officer, Chief Operating Officer
Andy Sassine
Chief Financial Officer
Lance Kurata
Chief Legal Officer
Alignment with Stockholders Interests. Our compensation model should be designed to align the economic interests of our executives with those of our stockholders.
Pay for Performance. Our compensation model should deliver compensation at or above industry market levels for exceptional performance and deliver compensation below the market levels of our industry for years in which the Company does not perform well. Further, all of the time-based equity awards are granted as stock options, which we believe are also inherently performance based as they only provide value to the executive if stockholders realize a positive return on their investment.
Total Rewards Program. The total compensation program must balance pay for performance elements with selected static non-performance based elements in order to create a total rewards program that is competitive and will help us attract and retain highly qualified and motivated executives.
Flexible Approach. The level of compensation provided to executives must take into account each executives role, experience, tenure, performance and expected contributions to our future success.
Focus on Achievement of Business Goals. The compensation program should be structured so that executives are appropriately incentivized to achieve our short- and long-term goals that are viewed as fundamental to driving value in our business.
☒
Pay-for-Performance
. A substantial majority of the compensation awarded to our NEOs is either tied to specific company-wide goals or have been made in the form of stock option awards that will only have value if the price of our stock increases after the grant date. There were no full value equity awards that guarantee value if the stock price does not increase, also known as restricted share or restricted stock units, granted to NEOs in 2024.
☒
Modest Perquisites.
We provide only modest perquisites and nearly all of those perquisites are in the form of insurance benefits that we believe are in line with industry practice for executive compensation. We do not provide perquisites such as personal travel reimbursement, tax services or financial planning.
☒
Periodic Peer Group Review
. The compensation committee periodically reviews the Companys compensation peer group and uses the market data for context, although it does not target any specific percentile.
☒
Double Trigger
. Our severance policy (the Severance Policy) only provides our executive officers with acceleration of unvested equity awards held by them if they are terminated (without cause or constructively) in connection with a change of control transaction or within 18 months following a change of control transaction. We do not provide accelerated vesting of equity awards on a change in control alone.
☒
Reasonable Post-Employment and Change of Control Severance Arrangements
. We believe that our severance arrangements with our executive officers are reasonable and in line with industry practice.
☒
Regular Review of Share Utilization for Equity Compensation
. We regularly evaluate equity spending by reviewing overhang levels (the dilutive impact of equity compensation on stockholders) and annual run rates (the aggregate shares awarded as a percentage of total outstanding shares).
☒
Mitigate Undue Risk
. We have designed our executive compensation program to mitigate undue risk associated with compensation by, among other things, awarding a substantial portion of executive compensation in the form of long-term compensation with multi-year vesting (i.e. stock options with multi-year vesting requirements).
☒
Utilize Independent Compensation Consulting Firm
. The compensation committee regularly consults with an independent compensation consulting firm which provides no other services to the Company. For more information on our independent compensation consultant, please see Board Meetings and CommitteesCompensation Committee above.
☒
No Stock Option Repricing Without Stockholder Approval
. Our equity incentive plans prohibit us from repricing, exchanging or otherwise providing value for underwater stock options.
☒
No Inclusion of the Value of Equity Awards in Severance Calculations.
Our post-termination and change of control severance arrangements do not include the value of equity awards in annual compensation for purposes of determining cash severance amounts.
☒
No Fixed Employment Terms or Guaranteed Future Compensation
. We do not have employment contracts with our executive officers that provide guaranteed terms of employment or guaranteed future compensation levels.
☒
No Funded Pension or Retirement Plans
. We do not provide any guaranteed or funded retirement plan benefits other than matching under the Companys 401(k) plan.
☒
No Hedging Transactions, Share Pledging, or Short Sales by Employees or Directors
. Our insider trading policy prohibits any employee or director from engaging in hedging transactions, short sales or trading in any derivative security of the Company. This policy also prohibits pledging our shares on margin.
1.
Base Salary. Each NEO earned an annual base salary during 2024 as a minimum guarantee of compensation to secure their ongoing employment and dedication.
2.
Short-Term Incentive Compensation. Each NEO was eligible to earn an incentive cash compensation payment for the 2024 performance period based on qualitative assessment of the Companys progress against its corporate goals and his individual performance and/or contribution to such progress. The purpose is to drive short-term performance as milestones towards the goal of creating long-term value for stockholders.
3.
Long-Term Incentive Compensation. Each NEO was awarded a stock option
grant during 2024, subject to a time-based vesting schedule. The purpose of the stock option grants is to reward growth in the stock price
without a guarantee of value if there is no stock price growth after grant, with a multi-year vesting schedule to support retention of
key employees and a long-term value orientation.
ACADIA
Ironwood
Blueprint
Novavax
Coherus
PTC
Collegium
Travere
Corcept
Ultragenyx
Dynavax
Vanda
Heron
Vir Biotechnology
Insmed
Name and Principal
Position
Joseph E. Payne
President and Chief Executive Officer, Director
698,000
695,000
(3,000
)
0
%
Dr. Padmanabh Chivukula
Chief Scientific Officer, Chief Operating Officer
550,000
550,000
0
%
Andy Sassine
Chief Financial Officer
550,000
550,000
0
%
Lance Kurata
Chief Legal Officer
500,000
500,000
0
%
Name
Joseph E. Payne
417,000
60
Dr. Padmanabh Chivukula
275,000
50
Andy Sassine
275,000
50
Lance Kurata
200,000
40
Advance Therapeutics Pipeline
o
ARCT-810: Phase 2 biological POC data (i.e. biomarker changes)
o
ARCT-032: Phase 1b enrollment completed H1 2024; Phase 2 FDA approval to proceed H2 2024
o
Partnered Vaccine Pipeline
o
Kostaive Updated Monovalent Covid Vaccine (CSL, Meiji): JP Approval
o
Kostaive Bivalent Covid Vaccine (CSL, Meiji): Phase 3 Topline Data H1 2024, JP Approval H2 2024
o
Seasonal Flu Vaccine (CSL): Phase 1 enrollment complete H1 2024; Topline Data H2 2024
o
Pandemic Flu Vaccine (BARDA): Initiate Phase 1
Collaboration Management
o
Complete Manufacturing Technology Transfer
o
Strengthen Operations Leadership
o
Keep collaborations in good standing
Non-dilutive Funds
o
$100M: Includes CSL Reward Milestones, JP Covid Vaccine Revenues, CF Foundation Funding, BD activities
o
Upside bonus -- sale of ARCALIS equity
Operations (Financial, Legal, Budget Discipline)
o
Achieve Budget
o
SEC Filings: On-time; SOX404: Compliant
o
Corporate Policies / Compliance: Implementation and Monitoring
o
Intellectual Property: New filings and maintenance; trade secrets database, trademark registrations
Name and Principal
Position
Year
Salary
($)
Bonus
($)
(1)
Option
Awards
($)
(2)
All
Other
Compensation
($)
Total
($)
Joseph E. Payne
2024
695,000
367,000
2,635,000
3,697,000
President and Chief Executive Officer, Director
2023
698,000
208,500
3,986,000
4,892,500
2022
630,000
504,000
4,460,000
5,594,000
Dr. Padmanabh Chivukula
2024
550,000
228,000
807,000
1,585,000
Chief Scientific Officer, Chief Operating Officer
2023
550,000
137,500
2,491,000
3,178,500
2022
525,000
262,500
2,318,500
3,106,000
Andy Sassine
2024
550,000
261,000
807,000
1,618,000
Chief Financial Officer, Director
2023
550,000
137,500
1,495,000
2,182,500
2022
525,000
301,875
2,318,500
3,145,375
Lance Kurata
2024
500,000
180,000
807,000
1,487,000
Chief Legal Officer
2023
500,000
100,000
1,495,000
2,095,000
2022
435,000
304,500
442,500
1,182,000
Name
Grant
Date
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)
Exercise
Price of
Option
Awards
($)
Grant Date
Fair Value of
Option
Awards
($)
(1)
Joseph Payne
12/16/2024
196,000
16.24
2,635,000
Dr. Padmanabh Chivukula
12/16/2024
60,000
16.24
807,000
Andy Sassine
12/16/2024
60,000
16.24
807,000
Lance Kurata
12/16/2024
60,000
16.24
807,000
An annual base salary of $695,000, paid in bi-monthly installments.
An annual bonus of up to 60% of annual base salary. The bonus will be subject to the achievement of certain criteria, as determined by our Board and compensation committee.
Reimbursement of travel and other expenses incurred by Mr. Payne in connection with his service as President and Chief Executive Officer.
For termination without cause or resignation for good reason unrelated to change in control of, Mr. Payne will be entitled to receive (i) severance pay in the form of continuation of payment installments of Mr. Paynes final base salary for 18 months, (ii) a pro rata portion of his annual bonus (as calculated by the compensation committee and Board at the end of the bonus period and paid in a lump sum when annual bonuses are paid to other executive officers), and (iii) payment of certain health insurance coverage premiums (COBRA) for up to 18 months following his termination of employment.
For termination without cause or resignation for good reason in connection with a change in control us, Mr. Payne will be entitled to receive a lump sum severance payment equal to (i) eighteen months annual base salary, (ii) an amount equal to his target annual bonus for the year of termination and (iii) an amount equal to a pro rata portion of his target annual bonus for the year of termination. Mr. Payne will also be entitled to payment of certain health insurance coverage premiums (COBRA) for up to 18 months following termination. In addition, Mr. Paynes unvested option awards and any other unvested time-based vesting equity awards then held by him will accelerate and become immediately vested and exercisable, if applicable, and no longer subject to repurchase, if applicable, upon such termination and will remain exercisable, if applicable, following Mr. Paynes termination as set forth in the applicable equity award.
An annual base salary of $550,000, paid in bi-monthly installments.
An annual bonus of up to 50% of annual base salary. The bonus will be subject to the achievement of certain criteria, as determined by our Board and compensation committee.
Reimbursement of travel and other expenses incurred by Mr. Sassine in connection with his service as Chief Financial Officer.
For termination without cause or resignation for good reason unrelated to change in control of us, Mr. Sassine will be entitled to receive (i) severance pay in the form of continuation of payment installments of Mr. Sassines final base salary for 12 months, (ii) a pro rata portion of his annual bonus (as calculated by the compensation committee and Board at the end of the bonus period and paid in a lump sum when annual bonuses are paid to other executive officers), and (iii) payment of certain health insurance coverage premiums (COBRA) for up to 12 months following his termination of employment.
For termination without cause or resignation for good reason in connection with a change in control of us, Mr. Sassine will be entitled to receive a lump sum severance payment equal to (i) one years annual base salary, (ii) an amount equal to his target annual bonus for the year of termination and (iii) an amount equal to a pro rata portion of his target annual bonus for the year of termination. Mr. Sassine will also be entitled to payment of certain health insurance coverage premiums (COBRA) for up to 12 months following termination. In addition, Mr. Sassines unvested option awards and any other unvested time-based vesting equity awards then held by him will accelerate and become immediately vested and exercisable, if applicable, and no longer subject to repurchase, if applicable, upon such termination and will remain exercisable, if applicable, following Mr. Sassines termination as set forth in the applicable equity award.
An annual base salary of $550,000, paid in bi-monthly installments.
An annual bonus of up to 50% of annual base salary. The bonus will be subject to the achievement of certain criteria, as determined by the Board and compensation committee.
Reimbursement of travel and other expenses incurred by Dr. Chivukula in connection with his service as Chief Scientific Officer and Chief Operating Officer.
For termination without cause or resignation for good reason unrelated to change in control of us, Dr. Chivukula will be entitled to receive (i) severance pay in the form of continuation of payment installments of Dr. Chivukulas final base salary for 12 months, (ii) a pro rata portion of his annual bonus (as calculated by the compensation committee and Board at the end of the bonus period and paid in a lump sum when annual bonuses are paid to other executive officers), and (iii) payment of certain health insurance coverage premiums (COBRA) for up to 12 months following his termination of employment.
For termination without cause or resignation for good reason in connection with a change in control of us, Dr. Chivukula will be entitled to receive a lump sum severance payment equal to (i) one years annual base salary, (ii) an amount equal to his target annual bonus for the year of termination and (iii) an amount equal to a pro rata portion of his target annual bonus for the year of termination. Dr. Chivukula will also be entitled to payment of certain health insurance coverage premiums (COBRA) for up to twelve (12) months following termination. In addition, Dr. Chivukulas unvested option award and any other unvested time-based vesting equity awards then held by him will accelerate and become immediately vested and exercisable, if applicable, and no longer subject to repurchase, if applicable, upon such termination and will remain exercisable, if applicable, following Dr. Chivukulas termination as set forth in the applicable equity award.
An annual base salary of $500,000, paid in bi-monthly installments.
An annual bonus of up to 40% of annual base salary. The bonus will be subject to the achievement of certain criteria, as determined by the Board and compensation committee.
Reimbursement of travel and other expenses incurred by Mr. Kurata in connection with his service as Chief Legal Officer.
For termination without cause or resignation for good reason unrelated to change in control of us, Mr. Kurata will be entitled to receive (i) severance pay in the form of continuation of payment installments of Mr. Kurata final base salary for 12 months, (ii) a pro rata portion of his annual bonus (as calculated by the compensation committee and Board at the end of the bonus period and paid in a lump sum when annual bonuses are paid to other executive officers), and (iii) payment of certain health insurance coverage premiums (COBRA) for up to 12 months following his termination of employment.
For termination without cause or resignation for good reason in connection with a change in control of us, Mr. Kurata will be entitled to receive a lump sum severance payment equal to (i) one years annual base salary, (ii) an amount equal to his target annual bonus for the year of termination and (iii) an amount equal to a pro rata portion of his target annual bonus for the year of termination. Mr. Kurata will also be entitled to payment of certain health insurance coverage premiums (COBRA) for up to twelve (12) months following termination. In addition, Mr. Kuratas unvested option award and any other unvested time-based vesting equity awards then held by him will accelerate and become immediately vested and exercisable, if applicable, and no longer subject to repurchase, if applicable, upon such termination and will remain exercisable, if applicable, following Mr. Kuratas termination as set forth in the applicable equity award.
Change of Control
Name
Involuntary
Termination
without Cause or Resignation for Good Reason
($)
Vesting upon
qualifying
termination or if Award
not Assumed,
Substituted or
Continued by
the Acquiring
Entity
(2)
Joseph Payne
(4) (5)
Cash Severance
$
1,409,500
1,409,500
Equity Treatment
Health and Welfare
$
13,700
13,700
TOTAL
$
1,423,200
1,423,200
Dr. Padmanabh Chivukula
(3) (5)
Cash Severance
$
778,000
778,000
Equity Treatment
Health and Welfare
$
9,100
9,100
TOTAL
$
787,100
787,100
Andy Sassine
(3)(5)
Cash Severance
$
811,000
811,000
Equity Treatment
Health and Welfare
$
9,100
9,100
TOTAL
$
820,100
820,100
Lance Kurata
(3)(5)
Cash Severance
$
680,000
680,000
Equity Treatment
Health and Welfare
$
9,100
9,100
TOTAL
$
689,100
689,100
Year
Salary
($)
Bonus
($)
Option
Awards
($)
All
Other
Compensation
($)
Total
($)
Joseph E. Payne
2024
695,000
367,000
Median Employee
2024
Year
Summary Compensation Table Total for Joseph E. Payne
1
($)
Compensation Actually Paid to Joseph E. Payne
1,2,3
($)
Average Summary Compensation Table Total for Non-PEO NEOs
1
($)
Average Compensation Actually Paid to Non-PEO NEOs
1,2,3
($)
Value of Initial Fixed $100 Investment based on:
4
Net Income
($ Millions)
TSR
($)
Peer Group TSR
($)
2024
3,696,808
(2,140,684)
1,562,907
(1,198,861)
156.12
113.84
(80.9)
2023
4,892,500
9,794,227
2,485,333
4,673,949
290.06
(29.7)
2022
5,594,000
2,673,712
3,125,688
1,256,688
9.3
2021
960,000
62,056
676,000
232,220
(203.7)
2020
12,861,500
14,070,814
6,715,139
399.08
125.69
(72.1)
1.
Joseph E. Payne was our PEO for each year presented. The individuals comprising the Non-PEO NEOs for each year presented are listed below.
2020
2021
2022
2023
2024
Andy Sassine
Andy Sassine
Andy Sassine
Andy Sassine
Andy Sassine
Lance Kurata
Lance Kurata
Lance Kurata
Dr. Steven Hughes
Dr. Steven Hughes
2.
The amounts shown for Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized, or received by the Companys NEOs. These amounts reflect the Summary Compensation Table Total with certain adjustments as described in footnote 3 below.
3.
Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Option Awards column are the amounts from the Option Awards column set forth in the Summary Compensation Table.
Year
Summary Compensation Table Total for Joseph E. Payne
($)
Exclusion of Option Awards for Joseph E. Payne
($)
Inclusion of Equity Values for Joseph E. Payne
($)
Compensation Actually Paid to Joseph E. Payne
($)
2024
3,696,808
(2,634,808)
(3,202,684)
(2,140,684)
2023
4,892,500
(3,986,000)
8,797,727
9,794,227
2022
5,594,000
(4,460,000)
1,539,712
2,673,712
2021
960,000
(897,944)
62,056
2020
12,861,500
13,120,814
14,070,814
Year
Average Summary Compensation Table Total for Non-PEO NEOs
($)
Average Exclusion of Stock Awards and Option Awards for Non-PEO NEOs
($)
Average Inclusion of Equity Values for Non-PEO NEOs
($)
Average Compensation Actually Paid to Non-PEO NEOs
($)
2024
1,562,907
(806,574)
(1,955,194)
(1,198,861)
2023
2,485,333
(1,827,000)
4,215,616
4,673,949
2022
3,125,688
(2,318,500)
449,500
1,256,688
2021
676,000
(443,780)
232,220
2020
6,286,144
(5,744,206)
6,173,201
6,715,139
Year
Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Joseph E. Payne
($)
Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Joseph E. Payne
($)
Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for Joseph E. Payne
($)
Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Joseph E. Payne
($)
Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Joseph E. Payne
($)
Total - Inclusion of
Equity Values for Joseph E. Payne
($)
2024
2,402,707
(4,085,364)
(1,520,027)
(3,202,684)
2023
4,736,522
3,347,013
714,192
8,797,727
2022
4,561,826
(1,919,615)
456,861
(1,559,360)
1,539,712
2021
(1,395,948)
498,004
(897,944)
2020
9,175,385
1,381,120
13,120,814
Year
Average Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Non-PEO NEOs
($)
Average Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Non-PEO NEOs
($)
Average Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for Non-PEO NEOs
($)
Average Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Non-PEO NEOs
($)
Average Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Non-PEO NEOs
($)
Total - Average Inclusion of
Equity Values for Non-PEO NEOs
($)
2024
735,523
(1,960,718)
(729,999)
(1,955,194)
2023
2,170,906
1,680,605
364,105
4,215,616
2022
2,374,286
(1,174,650)
258,888
(1,009,024)
449,500
2021
(710,024)
266,244
(443,780)
2020
4,943,576
840,321
389,304
6,173,201
1.
The Company TSR (as defined below) assumes $100 was invested in the Company for the period starting December 31, 2020 through the end of the listed year. Historical stock performance is not necessarily indicative of future stock performance.
Name
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable (1)
Option
Exercise
Price ($)
Option
Expiration
Date
Joseph Payne
120,000
8.00
8/24/2028
60,000
4.99
2/7/2029
100,000
14.12
2/18/2030
175,000
99.29
12/18/2030
112,500
37,500
34.57
12/10/2031
125,000
125,000
16.92
12/9/2032
50,000
150,000
28.88
12/15/2033
196,000
16.24
12/16/2034
Dr. Padmanabh Chivukula
80,000
8.00
8/24/2028
40,000
4.99
2/7/2029
60,000
14.12
2/18/2030
100,000
99.29
12/18/2030
63,750
21,250
34.57
12/10/2031
62,500
62,500
16.92
12/9/2032
31,250
93,750
28.88
12/15/2033
60,000
16.24
12/16/2034
Andy Sassine
36,250
8.00
8/24/2028
100,000
4.53
1/1/2029
15,000
10.23
10/25/2029
80,000
14.12
2/18/2030
100,000
99.29
12/18/2030
63,750
21,250
34.57
12/10/2031
62,500
62,500
16.92
12/9/2032
18,750
56,250
28.88
12/15/2033
60,000
16.24
12/16/2034
Lance Kurata
90,000
58.91
8/10/2030
25,000
99.29
12/18/2030
37,500
12,500
34.57
12/10/2031
62,500
62,500
16.92
12/9/2032
18,750
56,250
28.88
12/15/2033
60,000
16.24
12/16/2034
Plan Category
Number of
Securities to be
Issued upon
Exercise of
Outstanding
Options,
Warrants and
Rights
(a)
Weighted
Average
Exercise Price of
Outstanding
Options,
Warrants and
Rights
(b)
Number of
Securities
Remaining Available
for Future Issuance
Under Equity
Compensation Plans
(Excluding
Securities Reflected
in Column a)
(c)
Equity compensation plans approved by security holders
Equity compensation plans not approved by security
holders
Total
the related persons interest in the related person transaction;
the approximate dollar value of the amount involved in the related person transaction;
the approximate dollar value of the amount of the related persons interest in the transaction without regard to the amount of any profit or loss;
whether the transaction was undertaken in the ordinary course of business;
whether the transaction with the related person is proposed to be, or was, entered into on terms no less favorable to us than terms that could have been reached with an unrelated third party;
the purpose of, and the potential benefits to us of, the transaction; and
any other information regarding the related person transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction.
each person or entity known by us to own beneficially 5% or more of our outstanding shares;
each of our directors and executive officers individually; and
all of our executive officers and directors as a group.
Common Stock
Beneficially Owned
5% or Greater Stockholders
Number
Percentage
Federated Hermes(1)
4,711,512
17.4
%
Blackrock(2)
2,743,002
10.1
%
Nikko Asset Management Americas, Inc. (3)
2,315,294
8.5
%
Sumitomo Mitsui Trust Group, Inc. (3)
2,315,294
8.5
%
ARK Investment Management LLC(4)
2,047,687
7.6
%
Vanguard Group(5)
1,458,380
5.4
%
Directors and Executive Officers
Joseph E. Payne(6)
2,297,597
8.2
%
Andrew Sassine(7)
732,401
2.7
%
Pad Chivukula (8)
914,709
3.3
%
Lance Kurata(9)
265,000
*
Moncef Slaoui(10)
22,294
*
Peter C Farrell(11)
214,934
*
Magda Marquet(12)
144,311
*
James Barlow(13)
129,369
*
Edward Holmes(14)
106,869
*
Jing Marantz(15)
68,568
*
John Markels(16)
53,855
*
All directors and executive officers as a group (11 persons)
4,949,907
16.6
%
(1)
Based solely on an Schedule 13G filed with the SEC on January 17, 2024. The address of Federated Hermes,
Inc. is 1001 Liberty Avenue, Pittsburgh, PA 15222-3779.
(2)
Based solely on a Form 13G/A filed with the SEC on April 5, 2024. The address of BlackRock, Inc. is 55
East 52nd Street New York, NY 10055.
(3)
Based solely on a Form 13G filed with the SEC on November 5, 2024 jointly by Sumitomo Mitsui Trust Group,
Inc. (SMTG) and Nikko Asset Management Co., Ltd. (NAMC), and a Form 13G filed with the SEC on November 8,
2024 by Nikko Asset Management Americas, Inc. (NAMA, together with SMTG and NAMC, the Sumitomo Entities).
The address of SMTG is 1-4-1 Marunouchi, Chiyoda-ku, Tokyo 100-8233, Japan. The address of NAMC is Midtown Tower, 9- 7-1 Akasaka, Minato-ku,
Tokyo 107-6242, Japan. The address of NAMA is 605 Third Avenue, 38th Floor, New York, NY 10158. As set forth in the Form 13G filed jointly
by SMTG and NAMC, the securities reported by SMTG and NAMC as parent holding companies are owned, or may be deemed to be beneficially
owned, by their subsidiary, NAMA. As set forth in the Form 13G filed by NAMA, the securities being reported by NAMA as subsidiary of SMTG
and NAMC are owned, or may be deemed beneficially owned, by SMTG and NAMC. Based solely on a Form 13G/A filed with the SEC on January
29, 2024.
(4)
The address of ARK Investment Management LLC is 3 East 28th Street, 7th Floor, New York, NY 10016. Based
on the Form 13G jointly by SMTG and NAMC, and the Form 13G filed by NAMA, the Sumitomo Entities have beneficial ownership of 2,315,294
shares of common stock in the aggregate.
(5)
Based solely on a Form 13G filed with the SEC on February 13, 2024. The address of The Vanguard Group
is 100 Vanguard Blvd. Malvern, PA 19355.
(6)
Includes 817,500 shares issuable upon the exercise of options exercisable within 60 days of April 8,
2025; does not include 433,500 shares issuable upon the exercise of options subject to vesting.
(7)
Includes 511,875 shares issuable upon the exercise of options exercisable within 60 days of April 8,
2025; does not include 164,375 shares issuable upon the exercise of options subject to vesting.
(8)
Includes 479,375 shares issuable upon the exercise of options exercisable within 60 days of April 8,
2025; does not include 195,625 shares issuable upon the exercise of options subject to vesting.
(9)
Includes 265,000 shares issuable upon the exercise of options exercisable within 60 days of April 8,
2025; does not include 160,000 shares issuable upon the exercise of options subject to vesting.
(10)
Includes 22,294 shares issuable upon the exercise of options exercisable within 60 days of April 8,
2025; does not include 7,500 shares issuable upon the exercise of options subject to vesting.
(11)
Includes 214,934 shares issuable upon the exercise of options exercisable within 60 days of April 8, 2025.
(12)
Includes 144,311 shares issuable upon the exercise of options exercisable within 60 days of April 8, 2025.
(13)
Includes 129,369 shares issuable upon the exercise of options exercisable within 60 days of April 8, 2025.
(14)
Includes 106,869 shares issuable upon the exercise of options exercisable within 60 days of April 8, 2025.
(15)
Includes 68,568 shares issuable upon the exercise of options exercisable within 60 days of April 8, 2025.
(16)
Includes 53,855 shares issuable upon the exercise of options exercisable within 60 days of April 8, 2025.
Attn: Corporate Secretary
10628 Science Center Drive, Suite 250,
San Diego, California 92121
not earlier than February 10, 2026, and
not later than March 12, 2026
the 90th day prior to such annual meeting, or
the 10th day following the day on which public announcement of the date of such meeting is first made.
Attn: Corporate Secretary
10628 Science Center Drive, Suite 250,
San Diego, California 92121
April 25, 2025
EASY
HOLDINGS INC.
INTERNET
Use the Internet to vote your proxy. Have your proxy card available when you access the above website. Follow the prompts to vote your
shares.
MAIL
Mark, sign and date your
proxy card and return it in the postage-paid envelope provided.
FOLD HERE DO NOT SEPARATE INSERT IN ENVELOPE PROVIDED
1. Approval of the election of the following individuals as directors of the Company, to serve until the next annual meeting of stockholders.
2.
3.
Ratification of the appointment of Deloitte
Touche LLP as the Companys independent registered public accounting firm for the fiscal year ending December 31, 2025.
(Instruction: To withhold authority to vote for any individual nominee, strike a line through that nominees name in the list above)
CONTROL NUMBER
Signature__________________________Signature if held jointly
_
_____________________ Date____________, 2025.
FOLD HERE DO NOT SEPARATE INSERT IN ENVELOPE PROVIDED