TG THERAPEUTICS, INC.
10-Ks and 10-Qs
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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934
(Amendment No. __)
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 Rule 14a-12
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TG
THERAPEUTICS, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
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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:
(2) Aggregate
number of securities to which transaction applies:
(3) Per
unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule
0-11 (set forth the
amount on which the filing fee is calculated and state how it
was determined):
(4) Proposed
maximum aggregate value of transaction:
(5) Total
fee paid:
☐ 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:
TG THERAPEUTICS, INC.
2 Gansevoort Street, 9
th
Floor
New York, New York 10014
Dear
Stockholder:
You are
cordially invited to the Annual Meeting of Stockholders (the
"Annual Meeting") of TG Therapeutics, Inc. ("TG" or the "Company"),
to be held at 9:30 a.m. local time, on Friday, June 16, 2017, at
the offices of our legal counsel, Alston & Bird LLP, located at
90 Park Avenue, New York, New York 10016. At the meeting, the
stockholders will be asked to (i) elect seven directors for a term
of one year, and (ii) ratify the appointment of CohnReznick LLP as
our independent registered public accounting firm for the year
ending December 31, 2017. You will also have the opportunity to ask
questions and make comments at the meeting.
In
accordance with the rules and regulations of the Securities and
Exchange Commission, we are furnishing our proxy statement and
annual report to stockholders for the year ended December 31, 2016
on the Internet. You may have already received our “Important
Notice Regarding the Availability of Proxy Materials,” which
was mailed on or about April 28, 2017. That notice described how
you can obtain our proxy statement and annual report. You can also
receive paper copies of our proxy statement and annual report upon
request.
It is
important that your stock be represented at the meeting regardless
of the number of shares you hold. You are encouraged to specify
your voting preferences by marking our proxy card and returning it
as directed. If you do attend the meeting and wish to vote in
person, you may revoke your proxy at the meeting.
If you
have any questions about the proxy statement or the accompanying
2016 Annual Report, please contact Sean A. Power, our Chief
Financial Officer at (212) 554-4484.
We look
forward to seeing you at the Annual Meeting.
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Sincerely,
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/s/ Michael S. Weiss
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Michael S. Weiss
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Executive
Chairman, Chief Executive Officer and President
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April
28, 2017
New
York, New York
TG THERAPEUTICS, INC.
2 Gansevoort Street, 9
th
Floor
New York, New York 10014
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The
Annual Meeting of Stockholders of TG Therapeutics, Inc. will be
held at the offices of our legal counsel, Alston & Bird LLP,
located at 90 Park Avenue, New York, New York 10016, on Friday,
June 16, 2017, at 9:30 a.m., local time. At the meeting,
stockholders will consider and act on the following
items:
1.
Elect seven
directors for a term of one year;
2.
Ratify the
appointment of CohnReznick LLP as our independent registered public
accounting firm for the year ending December 31, 2017;
and
3..
Transact any other
business that may properly come before the Annual Meeting or any
adjournment of the Annual Meeting.
Only
those stockholders of record as of the close of business on April
18, 2017, are entitled to vote at the Annual Meeting or any
postponements or adjournments thereof. A complete list of
stockholders entitled to vote at the Annual Meeting will be
available for your inspection beginning April 24, 2017, at our
offices located at 2 Gansevoort Street, New York, New York 10014,
between the hours of 10:00 a.m. and 5:00 p.m., local time, each
business day.
YOUR VOTE IS IMPORTANT!
Instructions on how
to vote your shares via the Internet are contained on the
“Important Notice Regarding the Availability of Proxy
Materials,” which was mailed on or about April 28, 2017.
Instructions on how to obtain a paper copy of our proxy statement
and annual report to stockholders for the year ended December 31,
2016 are listed on the “Important Notice Regarding the
Availability of Proxy Materials.” These materials can also be
viewed online by following the instructions listed on the
“Important Notice Regarding the Availability of Proxy
Materials.”
If you
choose to receive a paper copy of our proxy statement and annual
report, you may vote your shares by completing and returning the
proxy card that will be enclosed.
Submitting your
proxy does not affect your right to vote in person if you decide to
attend the Annual Meeting. You are urged to submit your proxy as
soon as possible, regardless of whether or not you expect to attend
the Annual Meeting. You may revoke your proxy at any time before it
is voted at the Annual Meeting by (i) delivering written notice to
our Corporate Secretary, Sean A. Power, at our address above, (ii)
submitting a later dated proxy card, (iii) voting again via the
Internet as described in the “Important Notice Regarding the
Availability of Proxy Materials,” or (iv) attending the
Annual Meeting and voting in person. No revocation under (i) or
(ii) will be effective unless written notice or the proxy card is
received by our Corporate Secretary at or before the Annual
Meeting.
When
you submit your proxy, you authorize Michael S. Weiss and Sean A.
Power to vote your shares at the Annual Meeting and on any
adjournments of the Annual Meeting in accordance with your
instructions.
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By Order of the Board of
Directors,
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/s/ Sean A. Power
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Sean A. Power
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Corporate
Secretary
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April
28, 2017
New
York, New York
TG THERAPEUTICS, INC.
2 Gansevoort Street, 9
th
Floor
New York, New York 10014
Phone: (212) 554-4484
Fax: (212) 554-4531
PROXY STATEMENT
This
proxy statement is being
made
available via Internet access, beginning on or about April 28,
2017, to the owners of shares of common stock of TG Therapeutics,
Inc. (the “Company,” “our,”
“we,” or “TG”) as of April 18, 2017, in
connection with the solicitation of proxies by our Board of
Directors for our 2017 Annual Meeting of Stockholders (the
“Annual Meeting”). On or about April 28, 2017, we sent
an “Important Notice Regarding the Availability of Proxy
Materials” to our stockholders. If you received this notice
by mail, you will not automatically receive by mail our proxy
statement and annual report to stockholders for the year ended
December 31, 2016. If you would like to receive a printed copy of
our proxy statement, annual report and proxy card, please follow
the instructions for requesting such materials in the notice. Upon
request, we will promptly mail you paper copies of such materials
free of charge.
The
Annual Meeting will take place at the offices of our legal counsel,
Alston & Bird LLP, located at 90 Park Avenue, New York, New
York 10016 on Friday, June 16, 2017, at 9:30 a.m., local time. Our
Board of Directors encourages you to read this document thoroughly
and take this opportunity to vote, via proxy, on the matters to be
decided at the Annual Meeting. As discussed below, you may revoke
your proxy at any time before your shares are voted at the Annual
Meeting.
Table of Contents
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Proxy
Statement
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Questions
and Answers
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1
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Why did I receive an “Important Notice Regarding the
Availability of Proxy Materials”?
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1
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What is the purpose of the Annual Meeting?
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1
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Who is entitled to vote at our Annual Meeting?
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1
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How do I vote?
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1
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What is a proxy?
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1
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How will my shares be voted if I vote by proxy?
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1
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How do I revoke my proxy?
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2
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Is my vote confidential?
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2
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How are votes counted?
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2
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What constitutes a quorum at the Annual Meeting?
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2
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What vote is required to elect our directors for a one-year
term?
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2
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What vote is required to ratify CohnReznick
LLP
as our independent
registered public accounting firm for the year ending December 31,
2017?
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3
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What percentage of our outstanding stock do our directors and
executive officers own?
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3
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Who was our independent public accountant for the year ending
December 31, 2016? Will they be represented at the Annual
Meeting?
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3
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How can I obtain a copy of our annual report on Form
10-K?
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3
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Corporate
Governance
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4
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Our Board of Directors
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4
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Communicating with the Board of Directors
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6
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Audit Committee
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7
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Compensation Committee
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7
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Nominating Process
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7
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Code of Business Conduct and Ethics
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8
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Independent
Registered Public Accounting Firm Fees and Other
Matters
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9
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Audit Fees
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9
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Audit-Related Fees
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9
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Tax Fees
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9
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All Other Fees
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9
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Pre-Approval of Services
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9
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Report
of the Audit Committee
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10
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Our
Executive Officers
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11
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Executive Officers
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11
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Compensation
Discussion and Analysis
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12
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Compensation Philosophy and Objectives
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12
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Determining Executive Compensation
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12
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Elements of Compensation
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13
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Consideration of Prior Advisory Stockholder Vote on Executive
Compensation
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13
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2016 Executive Compensation
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14
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Perquisites and Other Executive Benefits
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15
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Severance
Benefits
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15
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Report of the Compensation Committee
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15
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Executive
Compensation
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16
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Summary Compensation Table
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16
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Grants of Plan-Based Awards for Fiscal Year 2016
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17
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Outstanding Equity Awards at 2016 Fiscal Year
End
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18
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Stock Vested in Fiscal Year 2016
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19
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Employment
Agreements
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19
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Potential
Payments upon Termination or Change in Control
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21
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Director
Compensation
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22
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2016 Director Compensation
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22
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Compensation
Committee Interlocks and Insider Participation
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23
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Section
16(a) Beneficial Ownership Reporting Compliance
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24
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Related-Person
Transactions
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24
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Stock
Ownership of Our Directors, Executive Officers, and 5% Beneficial
Owners
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26
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Proposal
One: Election of Directors; Nominees
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28
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Proposal Two: Ratification of Appointment of
CohnReznick LLP
as
ourIndependent Registered Public Accounting
Firm
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29
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Additional
Information
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30
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Householding of Annual Meeting Materials
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30
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Stockholder Proposals for Our 2018 Annual
Meeting
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30
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Other Matters
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30
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Solicitation of Proxies
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30
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Incorporation of Information by Reference
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30
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QUESTIONS AND ANSWERS
Q.
Why did I
receive an “Important Notice Regarding the Availability of
Proxy Materials”?
A.
In accordance with
Securities and Exchange Commission (“SEC”) rules,
instead of mailing a printed copy of our proxy materials, we may
send an “Important Notice Regarding the Availability of Proxy
Materials” to stockholders. All stockholders will have the
ability to access the proxy materials on a website referred to in
the notice or to request a printed set of these materials at no
charge. You will not receive a printed copy of the proxy materials
unless you specifically request one from us. Instead, the notice
instructs you as to how you may access and review all of the
important information contained in the proxy materials via the
Internet and submit your vote via the Internet.
Q.
What is the
purpose of the Annual Meeting?
A.
At the Annual
Meeting, our stockholders will act upon the matters outlined in the
Notice of Annual Meeting of Stockholders accompanying this proxy
statement, including (i) the election of seven directors for a term
of one year, (ii) ratifying the appointment of CohnReznick LLP as
our independent registered public accounting firm for the year
ending December 31, 2017, and (iv) transacting any other business
that may properly come before the 2017 Annual Meeting or any
adjournment thereof.
Q.
Who is entitled
to vote at our Annual Meeting?
A.
The record holders
of our common stock at the close of business on the record date,
April 18, 2017, may vote at the Annual Meeting. Each share of
common stock is entitled to one vote. There were 66,816,455 shares
of common stock outstanding on the record date and entitled to vote
at the Annual Meeting. A list of stockholders entitled to vote at
the Annual Meeting, including the address of and number of shares
held by each stockholder of record, will be available for your
inspection beginning April 24, 2017, at our offices located at 2
Gansevoort Street, New York, New York 10014, between the hours of
10:00 a.m. and 5:00 p.m., local time, each business
day.
Q.
How do I
vote?
A.
You may vote in
person at the Annual Meeting, by use of a proxy card if you receive
a printed copy of our proxy materials, via Internet as directed in
our “Important Notice Regarding the Availability of Proxy
Materials,” or by telephone as indicated in the proxy
card.
Q.
What is a
proxy?
A.
A proxy is a person
you appoint to vote your shares on your behalf. If you are unable
to attend the Annual Meeting, our Board of Directors is seeking
your appointment of a proxy so that your shares may be voted. If
you vote by proxy, you will be designating Michael S. Weiss, our
Executive Chairman, Chief Executive Officer and President, and Sean
A. Power, our Chief Financial Officer, Treasurer and Corporate
Secretary, as your proxies. Mr. Weiss and/or Mr. Power may act on
your behalf and have the authority to appoint a substitute to act
as your proxy.
Q.
How will my
shares be voted if I vote by proxy?
A.
Your proxy will be
voted according to the instructions you provide.
If you complete and submit your proxy but do
not otherwise provide instructions on how to vote your shares, your
shares will be voted (i) “FOR” the individuals
nominated to serve as members of our Board of Directors, and (ii)
“FOR” the ratification of CohnReznick LLP as our
independent registered public accounting firm for the year ending
December 31, 2017.
Presently, our Board does not know of any
other matter that may come before the Annual Meeting. However, your
proxies are authorized to vote on your behalf, using their
discretion, on any other business that properly comes before the
Annual Meeting.
1
Q.
How do I revoke
my proxy?
A.
You may revoke your
proxy at any time before your shares are voted at the Annual
Meeting by:
●
delivering written
notice to our Corporate Secretary, Sean A. Power, at our address
above;
●
submitting a later
dated proxy card or voting again via the Internet as described in
the “Important Notice Regarding the Availability of Proxy
Materials”; or
●
attending the
Annual Meeting and voting in person.
Q.
Is my vote
confidential?
A.
Yes. All votes
remain confidential.
Q.
How are votes
counted?
A.
Before the Annual
Meeting, our Board of Directors will appoint one or more inspectors
of election for the meeting. The inspector(s) will determine the
number of shares represented at the meeting, the existence of a
quorum and the validity and effect of proxies. The inspector(s)
will also receive, count, and tabulate ballots and votes and
determine the results of the voting on each matter that comes
before the Annual Meeting.
Abstentions and
votes withheld, and shares represented by proxies reflecting
abstentions or votes withheld, will be treated as present for
purposes of determining the existence of a quorum at the Annual
Meeting. They will not be considered as votes “for” or
“against” any matter for which the stockholder has
indicated their intention to abstain or withhold their vote. Broker
or nominee non-votes, which occur when shares held in “street
name” by brokers or nominees who indicate that they do not
have discretionary authority to vote on a particular matter, will
not be considered as votes “for” or
“against” that particular matter. Broker and nominee
non-votes will be treated as present for purposes of determining
the existence of a quorum, and may be entitled to vote on certain
matters at the Annual Meeting.
Q.
What
constitutes a quorum at the Annual Meeting?
A.
In accordance with
Delaware law (the law under which we are incorporated) and our
Amended and Restated Bylaws, the presence at the Annual Meeting, by
proxy or in person, of the holders of a majority of the outstanding
shares of the capital stock entitled to vote at the Annual Meeting
constitutes a quorum, thereby permitting the stockholders to
conduct business at the Annual Meeting. Abstentions, votes
withheld, and broker or nominee non-votes will be included in the
calculation of the number of shares considered present at the
Annual Meeting for purposes of determining the existence of a
quorum.
If a
quorum is not present at the Annual Meeting, a majority of the
stockholders present in person and by proxy may adjourn the meeting
to another date. If an adjournment is for more than 30 days or a
new record date is fixed for the adjourned meeting by our Board, we
will provide notice of the adjourned meeting to each stockholder of
record entitled to vote at the adjourned meeting. At any adjourned
meeting at which a quorum is present, any business may be
transacted that might have been transacted at the originally called
meeting.
Q.
What vote is
required to elect our directors for a one-year
term?
A.
The affirmative
vote of a plurality of the votes of the shares present, in person
or by proxy, at the Annual Meeting is required for the election of
each of the nominees for director. “Plurality” means
that the nominees receiving the largest number of votes up to the
number of directors to be elected at the Annual Meeting will be
duly elected as directors. Abstentions, votes withheld, and broker
or nominee non-votes will not affect the outcome of director
elections.
2
Q.
What vote is
required to ratify CohnReznick LLP as our independent registered
public accounting firm for the year ending December 31,
2017?
A. The
affirmative vote of a majority of the shares present, in person or
by proxy, and entitled to vote at the Annual Meeting is required to
approve the ratification of CohnReznick LLP as our independent
registered public accounting firm for the year ending December 31,
2017. Abstentions will have the same effect as a negative vote.
However, broker or nominee non-votes, and shares represented by
proxies reflecting broker or nominee non-votes, will not have the
effect of a vote against this proposal as they are not considered
to be present and entitled to vote on this matter.
Q.
What percentage
of our outstanding common stock do our directors and executive
officers own?
A.
As of April 18,
2017, our directors and executive officers owned, or have the right
to acquire, approximately 16.7% of our outstanding common stock.
See the discussion under the heading “Stock Ownership of Our
Directors, Executive Officers, and 5% Beneficial Owners” on
page 26 for more details.
Q.
Who was our
independent public accountant for the year ending December 31,
2016? Will they be represented at the Annual
Meeting?
A.
CohnReznick LLP is
the independent registered public accounting firm that audited our
financial statements for the year ending December 31, 2016. We
expect a representative of CohnReznick LLP to be present at the
Annual Meeting. The representative will have an opportunity to make
a statement and will be available to answer your
questions.
Q.
How can I
obtain a copy of our annual report on Form
10-K?
A.
We have filed our
annual report on Form 10-K for the year ended December 31, 2016,
with the SEC. The annual report on Form 10-K is also included in
the 2016 Annual Report to Stockholders.
You may obtain, free of charge, a copy of our
annual report on Form 10-K, including financial statements and
exhibits, by writing to our corporate secretary, Sean A. Power, or
by email at info@tgtxinc.com. Upon request, we will also furnish
any exhibits to the annual report on Form 10-K as filed with the
SEC.
3
CORPORATE
GOVERNANCE
Our Board of Directors
Our
amended and restated bylaws provide that the Board shall consist of
one or more members, as determined from time to time by resolution
of the Board. Currently, our Board consists of seven members. The
following individuals are being nominated to serve on our Board
(See “Proposal 1 – Election of Directors;
Nominees”):
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Director
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Name
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Age
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Position
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Since
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Michael
S. Weiss
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51
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Executive
Chairman, Chief Executive Officer and President
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2011
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Laurence N.
Charney
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70
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Director
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2012
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William
J. Kennedy
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72
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Director
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2012
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Mark
Schoenebaum, M.D.
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44
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Director
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2012
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Yann
Echelard
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53
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Director
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2012
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Kenneth
Hoberman
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52
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Director
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2014
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Daniel
Hume
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50
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Director
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2015
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The
Board does not have a formal policy regarding the separation of the
roles of Chief Executive Officer and Executive Chairman, as the
Board believes that it is in the best interests of the Company to
make that determination based on the direction of the Company and
the current membership of the Board. The Board has determined that
having a director who is an executive officer serve as the Chairman
is in the best interest of the Company’s stockholders at this
time.
TG has
a risk management program overseen by Michael S. Weiss, our
Executive Chairman, Chief Executive Officer and President and the
Board. Mr. Weiss and management identify material risks and
prioritize them for our Board. Our Board regularly reviews
information regarding our credit, liquidity, operations, and
compliance as well as the risks associated with each.
The
following biographies set forth the names of our directors and
director nominees, their ages, the year in which they first became
directors, their positions with us, their principal occupations and
employers for at least the past five years, any other directorships
held by them during the past five years in companies that are
subject to the reporting requirements of the Securities Exchange
Act of 1934 (the “Exchange Act”), or any company
registered as an investment company under the Investment Company
Act of 1940, as well as additional information, all of which we
believe sets forth each director nominee’s qualifications to
serve on the Board. There is no family relationship between and
among any of our executive officers or directors. There are no
arrangements or understandings between any of our executive
officers or directors and any other person pursuant to which any of
them are elected as an officer or director, except as disclosed
below.
On
December 29, 2011, Opus Point Partners, LLC, (“Opus”),
TG Biologics, Inc. (“TG Biologics”) and the Company
(and collectively with Opus and TG Biologics, the
“Parties”) entered into an Exchange Transaction
Agreement (the “Agreement”).
On August 2, 2012, the Parties executed an
amendment to the Agreement (“Amendment No. 1”) which
set the number of members of the board of directors of the Company
(the “Board of Directors”) at six, and required the
consent of Opus for any increase. Opus has consented to the
increase to seven.
Amendment No. 1 also granted Opus
the right to nominate three members of the Board of Directors until
the later of (x) two years from the Closing Date of the Agreement
(as defined therein), or (y) the date on which Opus beneficially
owns less than 10% of the Company’s common stock as
calculated pursuant to the rules and regulations under Section 13
of the Exchange Act. Accordingly, Opus has nominated Mr. Charney,
Dr. Kennedy, and Dr. Schoenebaum to the Company’s Board of
Directors.
In
connection with the Securities Exchange Agreement between the
Company and LFB Biotechnologies (“LFB Group”) dated
November 9, 2012, LFB Group maintains the right to nominate one
member to the Company’s Board of Directors. LFB has nominated
Dr. Echelard as its appointee to the Company’s Board of
Directors.
4
TG
adheres to the corporate governance standards adopted by The Nasdaq
Stock Market (“Nasdaq”). Nasdaq rules require our Board
to make an affirmative determination as to the independence of each
director. Consistent with these rules, our Board undertook its
annual review of director independence on March 3, 2017. During the
review, our Board considered relationships and transactions during
2016 and during the past three fiscal years between each director
or any member of his immediate family, on the one hand, and the
Company and our subsidiaries and affiliates, on the other hand. The
purpose of this review was to determine whether any such
relationships or transactions were inconsistent with a
determination that the director is independent. Based on this
review, our Board determined that Yann Echelard, Laurence Charney,
William Kennedy, Mark Schoenebaum, Kenneth Hoberman, and Daniel
Hume are independent under the criteria established by Nasdaq and
our Board.
Michael S.
Weiss, 51,
has served as TG's Executive Chairman, Chief
Executive Officer and President since December 2011. Mr. Weiss is a
co-founder of, and has been a managing partner and principal of
Opus Point Partners since 2009. Mr. Weiss earned his J.D. from
Columbia Law School and his B.S. in Finance from The University at
Albany. He began his professional career as a lawyer with Cravath,
Swaine & Moore. In 1999, Mr. Weiss founded Access Oncology
which was later acquired by Keryx Biopharmaceuticals, Inc. in 2004.
Following the merger, Mr. Weiss remained as CEO of Keryx and grew
the company to close to a $1 billion market capitalization company
at its peak. While at Keryx, he raised over $150MM in equity
capital through public and private offerings, executed a $100MM+
strategic alliance, negotiated multiple Special Protocol
Assessments ("SPA") agreements with the FDA and managed multiple
large clinical trials. Mr. Weiss also serves as Executive Vice
Chairman, Strategic Development for Fortress Biotech, Inc., a
publicly-traded biotechnology company ("Fortress") and Executive
Chairman of the Board of Directors of Checkpoint Therapeutics,
Inc., a publicly-traded biotechnology company
("Checkpoint").
Laurence N. Charney,
70,
has served on our Board since April 2012. Since 2007,
Mr. Charney has served as a business strategist and financial
advisor to Boards, CEOs and investors. Previously, from 1970
through June 2007, Mr. Charney was a senior audit partner at Ernst
& Young, LLP, a registered public accounting firm, retiring as
a practice leader in the Americas Quality and Risk Management
Group. Mr. Charney currently serves as an executive responsible for
quality and professional leadership development for Frankel,
Loughran, Starr & Vallone, LLP, CPA's and as a director and
audit committee chairman of Pacific Drilling S.A. and Kenon
Holdings LTD, both NYSE listed companies. In addition, Mr. Charney
previously served as a director and audit committee member of
Marvel Entertainment, Inc., Mrs. Fields Original Cookies, XTL
Biopharmaceuticals, Ltd., Pure Biofuels, Inc., and Iconix Brand
Group, Inc. In addition to his extensive experience on the boards
of various corporate entities, Mr. Charney is also active on the
boards of several non-profit organizations. Mr. Charney graduated
with a B.B.A. degree from Hofstra University and completed the
Executive MBA in Business program at Columbia
University.
William J. Kennedy, PhD.,
72,
has served
on our Board since April 2012. Dr. Kennedy is a regulatory affairs
professional with over 38 years of domestic and international
experience. Prior to his retirement, Dr. Kennedy was Vice President
for Regulatory Affairs for Zeneca Corporation. Dr. Kennedy has
successfully managed the development, preparation, submission and
approval of dozens of NDAs and major SNDAs. Dr. Kennedy has helped
shape regulatory policy in the United States continuously since
1988, as a member and Chairman of PhRMA's Regulatory Affairs
Coordinating Committee, as PhRMA's Chief Negotiator with Congress
and FDA for FDAMA, and as the Co-Chairman of PhRMA's PDUFA III
Steering Committee.
Before joining the
pharmaceutical industry, Dr. Kennedy was an Associate Research
Professor at Yale Medical School.
Dr. Kennedy is the author
of several articles and is an often sought after speaker for his
insight into the regulatory process.
He co-founded the website PDUFADate.com which
provides regulatory opinions to the financial community.
Dr.
Kennedy was the recipient of RAP's prestigious Special Recognition
Award in 1998.
Dr. Kennedy has been an
independent consultant to the pharmaceutical industry since
1999.
Mark Schoenebaum, M.D.,
44,
has served on our Board since April 2012. Dr.
Schoenebaum is a Senior Managing Director and heads ISI's Health
Care Research Team. He is also ISI's Biotechnology &
Pharmaceuticals major analyst. He has been ranked Institutional
Investor's #1 biotechnology analyst for the past nine years. In
2013, his second year competing in the category, Dr. Schoenebaum
was also ranked by Institutional Investor as the #1
Pharmaceuticals/Major analyst. In 2013, Mark was inducted into
Institutional Investor's All-America Research Team Hall of Fame, an
award given to analysts who have earned at least ten #1 rankings.
Prior to joining ISI in 2010, Dr. Schoenebaum spent two years at
Deutsche Bank as a Managing Director and Senior Biotechnology
Analyst. Prior to that, he held a similar position at Bear Stearns.
Dr. Schoenebaum graduated from Indiana University with highest
distinction in 1996 with a B.A. and received an M.D. from the Johns
Hopkins University School of Medicine in 2000.
5
Yann Echelard, 53,
has served on our Board since November 2012. Dr. Echelard,
President and CEO of rEVO Biologics, has over 25 years of research
and biopharmaceutical experience. Dr. Echelard holds a Ph.D. from
Université de Montréal, and has completed post-doctoral
studies at Ludwig Institute of Cancer Research in Montreal (McGill
University). As a visiting scientist at the Roche Institute and at
Harvard University (Developmental Biology), he had a key role in
the isolation and characterization of the Hedgehog genes, the first
identified vertebrate morphogens. From 1994 to 2010, he progressed
through various positions of increasing responsibility at Genzyme
Transgenics Corporation and at GTC Biotherapeutics, including Vice
President of Research and Development. In 1998, he led the
scientific team that first performed goat somatic cell nuclear
transfer (cloning). Focusing on Corporate Development, Dr. Echelard
spearheaded the creation of a collaborative Joint Venture with LFB
Biotechnologies in 2006, which was focused on the development of
recombinant plasma proteins and monoclonal antibodies. This close
collaboration led to the acquisition of GTC Biotherapeutics, Inc.
by LFB in December 2010. I
n addition, Dr. Echelard serves as Director for
rEVO Biologics, LFB-USA, HEMA Biologics and is on the Executive
Committee of LFB SA.
Kenneth Hoberman,
52,
has served on our Board since December 2014. Mr.
Hoberman is currently the Chief Operating Officer and Corporate
Secretary of Stemline Therapeutics, Inc. where he was a key member
of the founding team. He was instrumental in the company's
financings from early private, including institutional, rounds
through the IPO and subsequent follow-on offerings. He has
extensive financial, accounting, investor relations, corporate
governance and business development experience including M&A,
strategic alliances and partnerships both domestic and
international. His operational expertise includes regulatory
oversight, human resources, manufacturing and clinical development.
He was previously Vice President of Corporate and Business
Development of Keryx Biopharmaceuticals, Inc., where he was
instrumental in the success of the company. He also helped secure
multiple sources of capital including over $200 million in equity
investments through public and private offerings. He also initiated
and executed a $100 million strategic alliance and originated,
negotiated and closed dozens of licensing and operational
contracts, helping to grow the company's market capitalization to
over $1 billion. He also led the team that originated, in-licensed,
and developed Auryxia
™
which gained FDA approval
in 2014. He received a B.S.B.A. in Finance from Boston University
and completed post-baccalaureate studies at Columbia
University.
Daniel
Hume, 50,
has served on our Board since June 2015. Mr.
Hume is currently a partner in Kirby McInerney, LLP’s
New York office and is a member of the firm's management
committee. Mr. Hume's law practice focuses on securities,
structured finance, and antitrust litigation and regulation. He
joined Kirby McInerney, LLP in 1995. Since then, Mr. Hume has
advised corporate, public, and individual clients, including some
of the largest institutional investors in the world, and helped
them recover billions of dollars in losses throughout the course of
his career. His work has earned him assorted honors and
recognition, including most recently being named to both the
National Law Journal “hot” list and law360 “most
feared” list for 2013. Mr. Hume is admitted to the New York
State Bar and federal courts around the country, including the
United States District Courts for the Southern and Eastern
Districts of New York, the United States Court of Appeals for the
Second, Fourth, and Fifth Circuits, the Appellate Division of the
Supreme Court of the State of New York, First Judicial Department,
and the United States Supreme Court. He graduated from the State
University of New York at Albany
magna cum laude
(B.A. Philosophy, 1988) and from
Columbia Law School, where he served as Notes Editor for the
Columbia Journal of Environmental Law (J.D.,
1991).
During
2016, our Board held four meetings and took two actions by
unanimous written consent. With the exception of Mr. Schoenebaum,
during 2016, each incumbent director who served their full term and
are standing for election attended at least 75% of the meetings of
the Board of Directors and the meetings of those committees on
which each incumbent director served, in each case during the
period that such person was a director. The permanent committees
established by our Board of Directors are the Audit Committee and
the Compensation Committee, descriptions of which are set forth in
more detail below. Our directors are expected to attend each Annual
Meeting of Stockholders, and it is our expectation that all of the
directors standing for election will attend this year’s
Annual Meeting. Last year, all of our directors attended the 2016
Annual Meeting of Stockholders.
Communicating with the Board of Directors
Our
Board has established a process by which stockholders can send
communications to the Board. You may communicate with the Board as
a group, or to specific directors, by writing to Sean A. Power, our
Corporate Secretary, at our offices located at 2 Gansevoort Street,
9
th
Floor,
New York, New York 10014. The Corporate Secretary will review all
such correspondence and regularly forward to the Board a summary of
all correspondence and copies of all correspondence that deals with
the functions of the Board or committees thereof or that otherwise
requires their attention. Directors may at any time review a log of
all correspondence we receive that is addressed to members of our
Board and request copies of any such correspondence. Concerns
relating to accounting, internal controls, or auditing matters may
be communicated in this manner, or may be submitted on an anonymous
basis via e-mail at info@tgtxinc.com. These concerns will be
immediately brought to the attention of our Audit Committee and
resolved in accordance with procedures established by our Audit
Committee.
6
Audit Committee
The
Audit Committee currently consists of Laurence N. Charney
(Chairman), William Kennedy and Kenneth Hoberman.
The
Audit Committee held five meetings during the fiscal year ended
December 31, 2016. The duties and responsibilities of the Audit
Committee are set forth in the Charter of the Audit Committee which
was recently reviewed by our Audit Committee. Our Audit Committee
determined that no revisions needed to be made to the charter at
this time. A copy of the Charter of the Audit Committee is
available on our website, located at
www.tgtherapeutics.com.
Among other
matters, the duties and responsibilities of the Audit Committee
include reviewing and monitoring our financial statements and
internal accounting procedures, the selection of our independent
registered public accounting firm and consulting with and reviewing
the services provided by our independent registered public
accounting firm. Our Audit Committee has sole discretion over the
retention, compensation, evaluation and oversight of our
independent registered public accounting firm.
The SEC
and Nasdaq have established rules and regulations regarding the
composition of audit committees and the qualifications of audit
committee members. Our Board of Directors has examined the
composition of our Audit Committee and the qualifications of our
Audit Committee members in light of the current rules and
regulations governing audit committees. Based upon this
examination, our Board of Directors has determined that each member
of our Audit Committee is independent and is otherwise qualified to
be a member of our Audit Committee in accordance with the rules of
the SEC and Nasdaq.
Additionally, the
SEC requires that at least one member of the Audit Committee have a
“heightened” level of financial and accounting
sophistication. Such a person is known as the “audit
committee financial expert” under the SEC’s rules. Our
Board has determined that Mr. Charney is an “audit committee
financial expert,” as the SEC defines that term, and is an
independent member of our Board of Directors and our Audit
Committee. Please see Mr. Charney’s biography on page 5 for a
description of his relevant experience.
The
report of the Audit Committee can be found on page 10 of this proxy
statement.
Compensation Committee
The
Compensation Committee held one meeting during the fiscal year
ended December 31, 2016. The Compensation Committee currently
consists of all independent members of our Board of Directors, with
Mr. Hoberman as chairman. The duties and responsibilities of the
Compensation Committee are set forth in the Charter of the
Compensation Committee. A copy of the Charter of the Compensation
Committee is available on our website, located at
www.tgtherapeutics.com
. As discussed in
its charter, among other things, the duties and responsibilities of
the Compensation Committee include evaluating the performance of
the Chief Executive Officer and our Chief Financial Officer,
determining the overall compensation of the Chief Executive Officer
and our Chief Financial Officer and administering all executive
compensation programs, including, but not limited to, our incentive
and equity-based plans. The Compensation Committee evaluates the
performance of the Chief Executive Officer and our Chief Financial
Officer on an annual basis and reviews and approves on an annual
basis all compensation programs and awards relating to such
officers. The Compensation Committee applies discretion in the
determination of individual executive compensation packages to
ensure compliance with the Company’s compensation philosophy.
The Chief Executive Officer makes recommendations to the
Compensation Committee with respect to the compensation packages
for officers other than himself. The Compensation Committee may
delegate its authority to grant awards to certain employees, and
within specified parameters under the Company’s Amended and
Restated 2012 Incentive Plan, to a special committee consisting of
one or more directors who may but need not be officers of the
Company.
As of April 25,
2017,
however, the Compensation Committee
had not delegated any such authority.
Nasdaq
has established rules and regulations regarding the composition of
compensation committees and the qualifications of compensation
committee members. Our Board of Directors has examined the
composition of our Compensation Committee and the qualifications of
our Compensation Committee members in light of the current rules
and regulations governing compensation committees. Based upon this
examination, our Board of Directors has determined that each member
of our Compensation Committee is independent and is otherwise
qualified to be a member of our Compensation Committee in
accordance with such rules.
The
report of the Compensation Committee can be found on page 15 of
this proxy statement. Additional information regarding the
Compensation Committee’s processes and procedures for
consideration of executive compensation can be found in the
Compensation Discussion and Analysis beginning on page 12 of this
proxy statement.
Nominating Process
We do
not currently have a nominating committee or any other committee
serving a similar function. Director nominations are approved by a
vote of a majority of our independent directors as required under
the Nasdaq rules and regulations. Although we do not have a written
charter in place to select director nominees, our Board of
Directors has adopted resolutions regarding the director nomination
process. Our policy describing our director nomination process is
available on our website, located at
www.tgtherapeutics.com
. We believe that
the current process in place functions effectively to select
director nominees who will be valuable members of our Board of
Directors.
7
We
identify potential nominees to serve as directors through a variety
of business contacts, including current executive officers,
directors, community leaders and stockholders. We may, to the
extent they deem appropriate, retain a professional search firm and
other advisors to identify potential nominees.
We will
also consider candidates recommended by stockholders for nomination
to our Board. A stockholder who wishes to recommend a candidate for
nomination to our Board must submit such recommendation to our
Corporate Secretary, Sean A. Power, at our offices located at 2
Gansevoort Street, 9
th
Floor, New York,
New York 10014. Any recommendation must be received not less than
60 calendar days nor more than 90 calendar days before the
anniversary date of the previous year’s annual meeting. All
stockholder recommendations of candidates for nomination for
election to our Board must be in writing and must set forth the
following: (i) the candidate’s name, age, business address,
and other contact information, (ii) the number of shares of common
stock beneficially owned by the candidate, (iii) a complete
description of the candidate’s qualifications, experience,
background and affiliations, as would be required to be disclosed
in the proxy statement pursuant to Schedule 14A under the Exchange
Act, (iv) a sworn or certified statement by the candidate in which
he or she consents to being named in the proxy statement as a
nominee and to serve as director if elected, and (v) the name and
address of the stockholder(s) of record making such a
recommendation.
We
believe that our Board as a whole should encompass a range of
talent, skill, and expertise enabling it to provide sound guidance
with respect to our operations and interests. Our independent
directors evaluate all candidates to our Board by reviewing their
biographical information and qualifications. If the independent
directors determine that a candidate is qualified to serve on our
Board, such candidate is interviewed by at least one of the
independent directors and our Chief Executive Officer. Other
members of the Board also have an opportunity to interview
qualified candidates. The independent directors then determine,
based on the background information and the information obtained in
the interviews, whether to recommend to the Board that the
candidate be nominated for approval by the stockholders to fill a
directorship. With respect to an incumbent director whom the
independent directors are considering as a potential nominee for
re-election, the independent directors review and consider the
incumbent director’s service during his or her term,
including the number of meetings attended, level of participation,
and overall contribution to the Board. The manner in which the
independent directors evaluate a potential nominee will not differ
based on whether the candidate is recommended by our directors or
stockholders.
We
consider the following qualifications, among others, when making a
determination as to whether a person should be nominated to our
Board: the independence of the director nominee; the
nominee’s character and integrity; financial literacy; level
of education and business experience, including experience relating
to biopharmaceutical companies; whether the nominee has sufficient
time to devote to our Board; and the nominee’s commitment to
represent the long-term interests of our stockholders. We review
candidates in the context of the current composition of the Board
and the evolving needs of our business. We believe that each of the
current members of our Board (who are also our director nominees)
has the requisite business, biopharmaceutical, financial or
managerial experience to serve as a member of the Board, as
described above in their biographies under the heading “Our
Board of Directors.” We also believe that each of the current
members of our Board has other key attributes that are important to
an effective board, including integrity, high ethical standards,
sound judgment, analytical skills, and the commitment to devote
significant time and energy to service on the Board and its
committees.
We do
not have a formal policy in place with regard to diversity in
considering candidates for our Board, but the Board strives to
nominate candidates with a variety of complementary skills so that,
as a group, the Board will possess the appropriate talent, skills
and expertise to oversee our business.
Code of Business Conduct and Ethics
We have
adopted a Code of Business Conduct and Ethics, or the Code, which
applies to all of our directors and employees, including our
principal executive officer and principal financial officer. The
Code includes guidelines dealing with the ethical handling of
conflicts of interest, compliance with federal and state laws,
financial reporting, and our proprietary information. The Code also
contains procedures for dealing with and reporting violations of
the Code. We have posted our Code of Business Conduct and Ethics on
our website, located at www.tgtherapeutics.com.
8
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FEES AND OTHER
MATTERS
CohnReznick LLP,
the independent registered public accounting firm that audited our
financial statements for the years ended December 31, 2016 and 2015
has served as our independent registered public accounting firm
since 2002. We expect a representative of CohnReznick LLP to be
present at the Annual Meeting. The representative will have an
opportunity to make a statement and will be available to answer
your questions.
Our
Board has asked the stockholders to ratify the selection of
CohnReznick LLP as our independent registered public accounting
firm. See “Proposal Two: Ratification of Appointment of
CohnReznick LLP as Our Independent Registered Public Accounting
Firm” on page 29 of this proxy statement. The Board has
reviewed the fees described below and concluded that the payment of
such fees is compatible with maintaining CohnReznick LLP’s
independence. All proposed engagements of CohnReznick LLP, whether
for audit services, audit-related services, tax services, or
permissible non-audit services, were pre-approved by our Audit
Committee.
For the
fiscal years ended December 31, 2016 and 2015, CohnReznick LLP
billed us an aggregate of approximately $203,208 and $180,901,
respectively, in fees for the professional services rendered in
connection with the audits of our annual financial statements
included in our Annual Reports on Form 10-K for those two fiscal
years, the audit of internal control over financial reporting for
those two fiscal years, the review of our financial statements
included in our Quarterly Reports on Form 10-Q during those two
fiscal years, and other services provided in connection with
registration statements.
Audit-Related Fees
During
the fiscal years ended December 31, 2016 and 2015, we were not
billed by CohnReznick LLP for any fees for audit-related services
reasonably related to the performance of the audits and reviews for
those two fiscal years, in addition to the fees described above
under the heading “Audit Fees.”
Tax Fees
During
the fiscal years ended December 31, 2016 and 2015, we were not
billed by CohnReznick LLP for any fees for professional services
rendered for tax compliance, tax advice, and tax planning
services.
All Other Fees
During
the fiscal years ended December 31, 2016 and 2015, we were not
billed by CohnReznick LLP for any fees for services, other than
those described above, rendered to us and our affiliates for those
two fiscal years.
Pre-Approval of Services
Our
Audit Committee has established a policy setting forth the
procedures under which services provided by our independent
registered public accounting firm will be pre-approved by our Audit
Committee. The potential services that might be provided by our
independent registered public accounting firm fall into two
categories:
●
Services that are
permitted, including the audit of our annual financial statements,
the review of our quarterly financial statements, related
attestations, benefit plan audits and similar audit reports,
financial and other due diligence on acquisitions, and federal,
state, and non-US tax services; and
●
Services that may
be permitted, subject to individual pre-approval, including
compliance and internal-control reviews, indirect tax services such
as transfer pricing and customs and duties, and forensic
auditing.
Services that our
independent registered public accounting firm may not legally
provide include such services as bookkeeping, certain human
resources services, internal audit outsourcing, and investment or
investment banking advice.
All
proposed engagements of our independent registered public
accounting firm, whether for audit services or permissible
non-audit services, are pre-approved by the Audit Committee. We
jointly prepare a schedule with our independent registered public
accounting firm that outlines services which we reasonably expect
we will need from our independent registered public accounting
firm, and categorize them according to the classifications
described above. Each service identified is reviewed and approved
or rejected by the Audit Committee.
9
REPORT
OF THE AUDIT COMMITTEE
In monitoring the
preparation of our financial statements, the Audit Committee met
with both management and CohnReznick LLP, our independent
registered public accounting firm during the year ended December
31, 2016, to review and discuss all financial statements prior to
their issuance and to discuss any and all significant accounting
issues. Management and our independent registered public accounting
firm advised the Audit Committee that each of the financial
statements were prepared in accordance with generally accepted
accounting principles. The Audit Committee’s review included
a discussion of the matters required to be discussed pursuant to
Public Company Accounting Oversight Board (United States) Auditing
Standard 1301 (Communication with Audit Committees). Auditing
Standard 1301 requires our independent registered public accounting
firm to discuss with the Audit Committee, among other things, the
following:
●
Methods used
to account for significant or unusual
transactions;
●
T
he
effect of any accounting policies in controversial or emerging
areas for which there is a lack of authoritative guidance or
consensus;
●
T
he
process used by management to formulate sensitive accounting
estimates and the basis for the independent registered public
accounting firm’s conclusion regarding the reasonableness of
any such estimates; and
●
Any disagreements
with management over the application of accounting principles, the
basis for management’s accounting estimates and the
disclosures necessary in the financial
statement
s.
The
Audit Committee has discussed the independence of CohnReznick LLP,
our independent registered public accounting firm for the year
ended December 31, 2016, including the written disclosures made by
CohnReznick LLP to the Audit Committee, as required by PCAOB Rule
3526, “Communication with Audit Committees Concerning
Independence.” PCAOB Rule 3526 requires the independent
registered public accounting firm to (i) disclose in writing all
relationships that, in the independent registered public accounting
firm’s professional opinion, may reasonably be thought to
bear on independence, (ii) confirm their perceived independence,
and (iii) engage in a discussion of independence with the Audit
Committee.
Finally, the Audit
Committee continues to monitor the scope and adequacy of our
internal controls and other procedures, including any and all
proposals for adequate staffing and for strengthening internal
procedures and controls where appropriate and
necessary.
On the
basis of these reviews and discussions, the Audit Committee
recommended to the Board that it approve the inclusion of our
audited financial statements in our Annual Report on Form 10-K for
the fiscal year ended December 31, 2016, for filing with the
SEC.
By the
Audit Committee of the Board of Directors
Laurence
N. Charney, Chairman
William
Kennedy
Kenneth
Hoberman
Dated
March 1, 2017
10
OUR EXECUTIVE OFFICERS
Executive
Officers
Our
current executive officers are as follows:
|
|
|
|
|
|
|
Name
|
|
Age
|
|
Position
|
|
Michael
S. Weiss
|
|
51
|
|
Executive
Chairman, Chief Executive Officer and President
|
|
Sean A.
Power
|
|
35
|
|
Chief
Financial Officer, Treasurer and Corporate Secretary
|
No
executive officer is related by blood, marriage or adoption to any
other director or executive officer. The biography of Mr. Weiss is
presented in connection with “Corporate Governance”
beginning on page 4 of this proxy statement.
Sean A.
Power, 35,
has served as our
Chief Financial Officer since December 2011 and also currently
serves as the CFO of Opus Point Partners. Mr. Power joined the
Company from Keryx Biopharmaceuticals, Inc., where he served as
Corporate Controller from 2006 to 2011. During his tenure there,
Mr. Power was involved in all capital raising and licensing
transactions. He was also responsible for leading Keryx’s
compliance with SEC rules and regulations. Prior to joining Keryx,
he was with KPMG, LLP, independent certified public accountants.
Mr. Power received a B.B.A in accounting from Siena College and is
a member of the American Institute of Certified Public
Accountants.
11
COMPENSATION
DISCUSSION AND ANALYSIS
In the
paragraphs that follow, we give an overview and analysis of our
executive compensation program and philosophy for 2016, the
material compensation decisions we made under those programs with
respect to our named executive officers, and the material factors
that we considered in making those decisions. Later in this proxy
statement under the heading “Executive Compensation,”
you will find a series of tables containing specific information
about the compensation earned by or paid to the following
individuals, whom we refer to as our named executive officers, or
NEOs:
|
|
●
|
Michael S. Weiss, our Executive Chairman, Chief
Executive Officer and President; and
|
|
|
●
|
Sean A. Power, our Chief Financial Officer,
Treasurer and Corporate Secretary.
|
Compensation
Philosophy and Objectives
Our
compensation programs are designed to motivate our employees to
work toward achievement of our corporate mission to create
long-term sustained stockholder value by acquiring, developing and
commercializing novel treatments for B-cell malignancies and
autoimmune diseases. Attaining our key business and strategic goals
depends on attracting, retaining and motivating quality employees
in an exceptionally competitive environment. Our industry is highly
scientific, regulated, scrutinized and dynamic, and as a result, we
require employees that are highly educated, dedicated and
experienced. The driving philosophy and objectives behind our
executive compensation programs are:
|
|
●
|
to attract, retain, motivate and reward
outstanding employees;
|
|
|
● |
to align employees’ interests with those
of our stockholders by creating a strong focus on stock ownership
and appreciation and basing pay on performance measures that drive
long-term stockholder value;
|
|
|
● |
to incentivize our employees to achieve our
business goals;
|
|
|
● |
to recognize the individual contributions of
executives while fostering a shared commitment among executives;
and
|
|
|
● |
to reflect our
“pay for performance” culture.
|
Determining
Executive Compensation
Role of the Compensation Committee
The
Compensation Committee oversees our executive compensation
programs, including approving incentive programs, granting equity
awards, and determining appropriate levels of compensation for our
NEOs. Information about the Compensation Committee and its
composition and responsibilities can be found on page 7 under the
caption “Compensation Committee.”
Role of the Executives
Our
Chief Executive Officer develops recommendations regarding the
compensation levels for our Chief Financial Officer based upon a
subjective assessment of his individual performance during the
prior year and overall trends in the marketplace. In addition, each
year, management delivers a set of proposed corporate goals and
objectives that management believes are essential to the
achievement of the Company’s mission and long-term goals and
objectives. The Board of Directors works with the Compensation
Committee to review these recommendations and proposals, make any
modifications deemed appropriate, and the Compensation Committee
approves the final compensation levels and goals and objectives for
the NEOs.
12
Elements
of Compensation
Our
executive compensation program for 2016 consisted of the following
components:
|
Compensation Element
|
|
Purpose
|
|
Base Salary
|
|
Base
salary represents the fixed portion of an executive’s annual
compensation and is intended to recognize the executive’s
value to the Company based on skills and experience relative to the
responsibilities of his position.
|
|
Annual cash incentive awards
|
|
Annual
cash incentive awards represent the portion of an executive’s
compensation that is intended to vary as a direct reflection of
Company and individual performance for the year.
|
|
Long-term equity awards
|
|
Long-term equity
awards are intended to reward performance over a multi-year period,
link the interests of executives to those of the stockholders, and
encourage retention. Restricted stock awards generally are issued
based upon achievement of corporate goals and objectives in the
prior year.
|
|
Health and welfare plans and retirement plan
|
|
We
provide competitive levels of medical and disability coverage, and
retirement benefits under our 401(k) plan. Our executives
participate in the same programs offered to all of our eligible
employees.
|
|
Severance benefits
|
|
Our
named executive officers have employment agreements that provide
for severance benefits in certain circumstances.
|
No
specific formula is used in regard to the allocation of the various
elements within our executive compensation program. The
Compensation Committee retains the discretion to reduce or
eliminate the payment that otherwise might be payable to our
executives based upon unforeseen events occurring during the year
or its assessment of the Company’s or our executives’
performance in general.
In order to maximize the incentive effect of our compensation
program, we have structured our performance-based compensation to
include a mix of value opportunities and performance
measures.
●
Our annual cash incentive awards and our annual equity awards are
based principally upon the Company’s performance against
pre-set corporate goals and objectives and partially upon the
Compensation Committee’s assessment of each individual
executive’s contribution to the Company’s
performance.
●
The ultimate
realized value of our equity awards (stock options and restricted
stock awards) is tied to our stock price, in alignment with the
interests of our stockholders.
Consideration
of Prior Advisory Stockholder Vote on Executive
Compensation
At the
2016 Annual Meeting of Stockholders, our stockholders voted to
approve the compensation of the Company’s named executive
officers, as discussed and disclosed in the 2016 Proxy
Statement. In considering the results of this advisory vote on
executive compensation, the Compensation Committee concluded that
the compensation paid to our named executive officers and the
Company's executive pay practices enjoyed stockholder
support.
In
light of this support, the Compensation Committee decided to retain
the core design of our executive compensation program, with an
emphasis on short and long-term incentive compensation that rewards
our executives when they successfully achieve our corporate goals
and objectives and, in turn, deliver value for our shareholders.
The advisory vote on executive compensation at the Annual Meeting,
and at future meetings, will serve as an additional tool to guide
the Board of Directors and the Compensation Committee in evaluating
the alignment of the Company’s executive compensation program
with the interests of the Company and its
stockholders.
At the
2016 Annual Meeting of Stockholders, our stockholders expressed a
preference that advisory votes on executive compensation be held
every three years. Consistent with this preference, the Board
of Directors determined to implement an advisory vote on executive
compensation every three years until the next required vote on the
frequency of stockholder votes on the compensation of executive
officers, which is scheduled to occur at the 2019 annual
meeting.
13
2016
Executive Compensation
Benchmarking and Peer Group
In
December 2015, we conducted a comparative analysis of our executive
compensation program, which was utilized for 2015 incentive
compensation and 2016 base salary assessments. The review of
executive compensation included a comparison of salary, bonus and
other forms of compensation, including stock based compensation,
for a peer group of 20 publicly-traded companies in the
biotechnology industry that we identified as being comparable to
the Company in size (ranging in market capitalization from
approximately $550 million to $1 billion) and
operation.
The
peer group members included:
|
Array
BioPharma, Inc.
Enanta
Pharmaceuticals, Inc.
Loxo
Oncology Inc.
PDL
BioPharma Inc.
Karyopharm
Therapeutics Inc.
Geron
Corp
Aerie
Pharmaceuticals Inc.
|
Otonomy
Inc.
BioCryst
Pharmaceuticals Inc.
Synergy
Pharmaceuticals Inc.
Retrophin
Inc.
Pacific
Biosciences of California
Sucampo
Pharmaceuticals Inc.
|
Supernus
Pharmaceuticals Inc.
MannKind
Corp
Dermira
Inc
Repligen
Corp
Insmed
Inc.
Dynavax
Technologies Corp
Heron
Therapeutics Inc.
|
Based
on the peer group analysis, the Compensation Committee concluded
that certain components of cash compensation for the NEOs were
below the 25
th
percentile for the
peer group examined. After considering this analysis, the
Compensation Committee approved the following changes to Mr.
Weiss’ and Mr. Power’s base salaries for 2016, which
were intended to make their total cash compensation more
competitive with the peer group:
●
Effective January
1, 2016, Mr. Weiss’ base salary was increased from $325,000
to $375,000; and
●
Effective January
1, 2016, Mr. Power’s base salary was increased from $225,000
to $300,000.
Cash Incentive Awards
In
2016, Mr. Weiss was eligible to earn a target annual cash incentive
equal to 100% of his base salary, and Mr. Power was eligible to
earn a target annual cash incentive equal to 33% of his base
salary, per the terms of their respective employment agreements.
Both executives’ annual cash incentive awards were based upon
the Company’s performance against pre-established corporate
goals and objectives, which included a combination of clinical and
regulatory goals related to our products as well as other corporate
goals, and each executive’s individual performance based upon
subjective performance reviews.
14
The
corporate performance goals and objectives used to determine annual
incentive awards in 2016 were as follows:
●
Various clinical and pre-clinical goals – 64% maximum
potential weighting (48% achieved, 14% deferred);
●
Various goals
related to manufacturing, non-clinical and regulatory – 31%
maximum potential weighting (22% achieved);
●
Various goals
related to business development operations – 5% maximum
potential weighting (3% achieved).
These
goals and objectives were achieved at an aggregate level of
approximately 73%, with approximately 14% deferred into 2017 based
on the outcomes of various clinical and regulatory discussions.
Accordingly the executives were paid 73% of their target bonus
amounts. The actual amounts paid to the executives pursuant to
their annual cash incentive awards are reported in the
“Summary Compensation Table” as non-equity incentive
plan compensation.
Long-Term Equity Incentive Awards
Mr.
Weiss’ employment agreement provides that each year the
Company will grant Mr. Weiss a number of shares of restricted
common stock equal to 1.25% of the shares of common stock
outstanding on the date of grant on a fully-diluted basis. Each of
these annual grants of restricted stock will vest and become
non-forfeitable as to 25% of the shares on the first anniversary of
the respective date of grant, as to 25% of the shares on the second
anniversary of the respective date of grant and as to 50% of the
shares on the date that the “market capitalization” (as
defined in the employment agreement) is $100 million greater than
the market capitalization on the respective date of grant, provided
that Mr. Weiss remains an employee, director and/or consultant of
the Company through each vesting date. Accordingly, on December 30,
2016 the Compensation Committee granted Mr. Weiss an award of
693,750 shares of restricted stock.
After
consideration of our 2016 corporate goals and objectives, and a
subjective consideration of Mr. Power’s individual
performance during 2016, on December 30, 2016 the Compensation
Committee granted Mr. Power an award of 100,000 shares of
restricted stock.
For
additional information regarding our named executive
officers’ stock grants, see the “Summary Compensation
Table,” the “Grants of Plan-Based Awards Table”
and the “Outstanding Equity Awards at 2016 Fiscal Year
End” table.
Perquisites
and Other Executive Benefits
We do
not offer our NEOs any perquisites or other executive
benefits.
Severance
Benefits
We have
employment agreements with our NEOs that provide, among other
things, payment and benefits upon certain terminations of
employment. We believe the severance benefits components of these
agreements is an important component to recruiting and retaining
high quality executive officers.
For
more information on Mr. Weiss’ and Mr. Power’s
employment agreements see the “Potential Payments upon
Termination or Change-in-Control” section beginning on page
21 of this proxy statement.
Report
of the Compensation Committee
The
Compensation Committee of the Board of Directors has reviewed and
discussed with management the Compensation Discussion and Analysis
set forth above. Based on the review and discussions noted above,
the Compensation Committee recommended to the Board of Directors
that the Compensation Discussion and Analysis be included in this
proxy statement and incorporated by reference in the
Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2016, for filing with the SEC.
By the
Compensation Committee of the Board of Directors
Kenneth
Hoberman, Chairperson
Laurence
Charney
Daniel
Hume
William
Kennedy
Mark
Schoenebaum
15
EXECUTIVE COMPENSATION
Summary Compensation Table
The
following table sets forth the cash and other compensation that we
paid to our current named executive officers (“NEOs”)
or that was otherwise earned by our NEOs for their services in all
capacities during 2014, 2015, and 2016.
|
Name and Principal
Position
|
Year
|
Salary
($)
|
Stock Awards
($) (1)
|
Option Awards
($)
|
Non-Equity Incentive Plan Compensation ($)
|
All Other Compensation ($)
|
Total ($)
|
|
|
|
|
|
|
|
|
|
|
Michael S.
Weiss
|
2016
|
375,000
|
3,225,935
|
--
|
276,000
|
--
|
3,876,935
|
|
Executive Chairman, Chief
Executive
|
2015
|
325,000
|
13,440,772
|
--
|
203,125
|
--
|
13,968,897
|
| Officer and President |
2014
|
262,500
|
4,233,183
|
--
|
210,000
|
--
|
4,705,6383
|
|
|
|
|
|
|
|
|
|
|
Sean A.
Power
|
2016
|
300,000
|
465,000
|
--
|
72,864
|
--
|
837.864
|
|
Chief Financial Officer,
Treasurer
|
2015
|
225,000
|
596,500
|
--
|
46,406
|
--
|
867,906
|
|
and Corporate Secretary
|
2014
|
180,000
|
157,600
|
--
|
50,000
|
--
|
387,600
|
_____________________________
(1)
Reflects the
aggregate grant date fair value of stock awards granted by the
Company as computed under FASB ASC Topic 718. The grant date fair
value of the time-based restricted stock awards is based on the
fair market value of the underlying shares on the date of grant and
does not take into account any estimated forfeitures. Because the
“measurement date” for accounting purposes has not yet
occurred for the milestone-based restricted stock awards, the grant
date for those awards has not yet occurred and the grant date fair
value is uncertain. For such awards, stock-based compensation will
be measured and recorded if and when a milestone occurs. The grant
date value for such awards reflected in the table is based on the
fair market value of the shares on the date the milestones were
established and does not take into account any potential
forfeitures.
16
Grants of Plan-Based Awards For Fiscal Year 2016
The
following table below sets forth the individual grants of awards
made to each of our NEOs during 2016. For a description of the
individual amounts indicated below, please see our Compensation
Discussion and Analysis beginning on page 12 of this proxy
statement.
|
|
|
|
|
Estimated Future
Payouts Under
Non-Equity
Incentive Plan Awards
(1)
|
|
All other
Stock Awards:
|
|
Grant Date
Fair Value
|
||||
|
Name
|
|
Grant Date
|
|
Threshold
($)
|
|
Target
($)
|
|
Maximum
($)
|
|
Number of Shares
of Stock or Units (#)
(2)
|
|
of
Awards ($)
(3)
|
|
Mr.
Weiss
|
|
|
|
|
|
375,000
|
|
|
|
|
|
|
|
|
|
12/31/16
|
|
|
|
|
|
|
|
693,750
|
|
3,225,935
|
|
Mr.
Power
|
|
|
|
|
|
99,000
|
|
|
|
|
|
|
|
|
|
12/31/16
|
|
|
|
|
|
|
|
100,000
|
|
465,000
|
|
(1)
|
Represents
target payout values for 2016 cash performance awards, assuming
100% achievement of corporate goals and objectives. The actual
amount earned by each NEO in 2016 is reported under the Non-Equity
Incentive Plan Compensation column in the Summary Compensation
Table on page 16 of this proxy statement.
|
|
(2)
|
Award
of time and milestone based vesting restricted stock under the 2012
Incentive Plan.
|
|
(3)
|
Reflects
the aggregate grant date fair value of stock awards granted by the
Company during 2016 as computed under FASB ASC Topic 718. The grant
date fair value of the stock awards is based on the fair market
value of the underlying shares on the date of grant and does not
take into account any estimated forfeitures. Because the
“measurement date” for accounting purposes has not yet
occurred the grant date for those awards has not yet occurred and
the grant date fair value is uncertain. The grant date value for
such awards reflected in the tables is based on the fair market
value of the shares on the date the milestones were established and
does not take into account any potential forfeitures.
|
For a
description of the vesting schedules of the equity awards, please
see the Outstanding Equity Awards at 2016 Fiscal Year End Table
below.
17
Outstanding Equity Awards at 2016 Fiscal Year End
The
following table provides information concerning equity awards that
are outstanding as of December 31, 2016 for each of our
NEOs.
|
|
|
Stock Awards
|
||
|
Name
|
|
Number of Shares or Units of Stock
That Have
Not
Vested
(#)
|
|
Market Value of Shares or Units
of Stock That Have Not Vested
($)
|
|
Mr.
Weiss
|
|
1,125,000(1)
|
|
5,231,250
|
|
|
|
400,000(2)
|
|
1,860,000
|
|
|
|
86,743(3)
|
|
403.355
|
|
|
|
491,920(4)
|
|
2,287,428
|
|
|
|
268,603(5)
|
|
1,249,004
|
|
|
|
337,257(6)
|
|
1,568,245
|
|
|
|
672,343(7)
|
|
3,126,395
|
|
|
|
693,750(8)
|
|
3,225,938
|
|
|
|
|
|
|
|
Mr.
Power
|
|
58,333(9)
|
|
271,248
|
|
|
|
7,500(10)
|
|
34,875
|
|
|
|
50,000(11)
|
|
232,500
|
|
|
|
100,000(12)
|
|
465,000
|
____________________
(1)
Restricted stock
granted to Mr. Weiss on May 16, 2012, under the TG Therapeutics,
Inc. Amended and Restated 2012 Incentive Plan (“2012
Incentive Plan”). The shares vest as follows: 250,000 on
September 15, 2017; 250,000 on June 15, 2018; 250,000 on March 15,
2019; and 375,000 on the later to occur of: (a) the first date that
the Company achieves a pre-established market capitalization target
and (b) December 15, 2018.
(2)
Restricted stock
granted to Mr. Weiss on December 28, 2012, under the 2012 Incentive
Plan. The shares vest as follows: 200,000 on March 15, 2017;
100,000 on the later to occur of: (a) the first date that the
Company achieves a pre-established market capitalization target and
(b) June 15, 2017; and 100,000 on the later to occur of: (a) the
first date that the Company achieves a pre-established market
capitalization target and (b) June 15, 2017.
(3)
Restricted stock
granted to Mr. Weiss on December 28, 2012, under the 2012 Incentive
Plan. The shares vest on March 15, 2017.
(4)
Restricted stock
granted to Mr. Weiss on December 30, 2013, under the 2012 Incentive
Plan. The shares vest as follows: 50% on March 15, 2018; and 50% on
the later to occur of: (a) the first date that the issuer achieves
a market capitalization target of $100M greater than the market
capitalization on the date of grant and (b) September 15,
2018.
(5)
Restricted stock
granted to Mr. Weiss on December 30, 2014, under the 2012 Incentive
Plan. The shares vest as follows: 25% on January 1, 2018; 25% on
January 1, 2019; and 50% on the later to occur of: (a) the first
date that the issuer achieves a market capitalization target of
$100M greater than the market capitalization on the date of grant
and (b) January 1, 2020.
(6)
Restricted stock
granted to Mr. Weiss on June 4, 2015 (represents the remainder due
to Mr. Weiss for 2014 per his employment agreement, which were
initially deferred), under the 2012 Incentive Plan. The shares vest
as follows: 25% on January 1, 2018; 25% on January 1, 2019; and 50%
on the later to occur of: (a) the first date that the issuer
achieves a market capitalization target of $100M greater than the
market capitalization on the date of grant and (b) January 1,
2020.
(7)
Restricted stock
granted to Mr. Weiss on December 31, 2015, under the 2012 Incentive
Plan. The shares vest as follows: 25% on June 30, 2017; 25% on June
30, 2018; and 50% on the later to occur of: (a) the first date that
the issuer achieves a market capitalization target of $100M greater
than the market capitalization on the date of grant and (b) June
30, 2018.
(8)
Restricted stock
granted to Mr. Weiss on December 31, 2016, under the 2012 Incentive
Plan. The shares vest as follows: 25% on January 1, 2018; 25% on
January 1, 2019; and 50% on the date that the Company's Market
Capitalization is $100 million greater than the Market
Capitalization on December 31, 2016.
(9)
Restricted stock
granted to Mr. Power on May 16, 2012, under the 2012 Incentive
Plan. The shares vest on June 15, 2017.
(10)
Restricted stock
granted to Mr. Power on December 30, 2014, under the 2012 Incentive
Plan. The shares vest in equal installments on January 1, 2017,
January 1, 2018 and January 1, 2019.
(11)
Restricted stock
granted to Mr. Power on December 31, 2015, under the 2012 Incentive
Plan. The shares vest as follows: 25% on January 1, 2017; 25% on
January 1, 2018; and 50% on the later to occur of: (a) the first
date that the issuer achieves a market capitalization target of
$100M greater than the market capitalization on the date of grant
and (b) June 30, 2018.
(12)
Restricted stock
granted to Mr. Power on December 31, 2016, under the 2012 Incentive
Plan. The shares vest as follows: 17.5% on January 1, 2018; 17.5%
on January 1, 2019; 35% on the later to occur of: (a) the date that
the Company's Market Capitalization is $100 million greater than
the Market Capitalization on December 31, 2016 and (b) June 30,
2019; and 30% on performance based thresholds associated with the
Company’s clinical programs.
18
Stock Vested in Fiscal Year 2016
The
following table provides information regarding the number of shares
acquired upon the vesting of restricted shares for our NEOs during
2016. The NEOs have not been granted any stock
options.
|
|
|
Stock Awards
|
||
|
Name
|
|
Number of Shares
Acquired
on
Vesting
(#)
|
|
Value Realized
on
Vesting
($)
(1)
|
|
Mr. Weiss
|
|
--
|
|
--
|
|
Mr. Power
|
|
135,833
|
|
1,057,948
|
|
(1)
|
Represents the aggregate value of restricted stock vesting in 2016,
based upon the fair market value of our common stock on the
applicable vesting date.
|
Employment Agreements
Michael S.
Weiss.
Mr. Weiss was
appointed Executive Chairman, Chief Executive Officer and President
of the Company, effective December 29, 2011. Under Mr. Weiss’
employment agreement, Mr. Weiss is to serve as the Company’s
Executive Chairman, Chief Executive Officer and President until
such employment is terminated pursuant to the terms of the
agreement. Mr. Weiss’ base salary for 2015 was $325,000
(which will automatically be reduced by 50% when Mr. Weiss resigns
from his interim roles). Mr. Weiss is also eligible to earn an
annual cash performance bonus, based upon achievement of annual
performance goals and objectives set by agreement between Mr. Weiss
and the Board each year, with a target bonus of 100% of his base
salary.
The
Company will also grant Mr. Weiss a number of shares of restricted
common stock equal to 1.25% of the shares of common stock
outstanding on the date of grant on a fully-diluted basis. Each of
these annual grants of restricted stock will vest and become
non-forfeitable as to 25% of the shares on the first anniversary of
the respective date of grant, as to 25% of the shares on the second
anniversary of the respective date of grant and as to 50% of the
shares on the date that the “market capitalization” (as
defined in the employment agreement) is $100 million greater than
the market capitalization on the respective date of grant, provided
that Mr. Weiss remains an employee, director and/or consultant of
the Company through each vesting date.
Pursuant to his
employment agreement, if Mr. Weiss’ employment is terminated
by the Company without Cause (as defined therein) or if Mr. Weiss
resigns for Good Reason (as defined therein), then, in addition to
his accrued obligations, if within 45 days after the date of
termination, he executes and does not revoke a general release of
claims and covenant not to sue, he will receive the following
severance benefits: (i) a lump sum severance payment equal to 1.5
times the sum of his base salary and target bonus (or 2 times the
sum of his base salary and target bonus if his employment is
terminated upon or following a change in control); (ii)
continuation of group health benefits for 18 months (or 24 months
if his employment is terminated upon or following a change in
control); (iii) a prorated target bonus; (iv) any shares of
restricted stock outstanding on the date of his termination will
become fully-vested and non-forfeitable as of his date of
termination; and (v) any stock options outstanding on the date of
his termination will become fully-vested and will remain
exercisable for a period of 24 months following the date of his
termination (or, if earlier, the normal expiration date of such
stock options).
If Mr.
Weiss’ employment is terminated by reason of his death or
disability, he will be entitled to his accrued obligations and a
prorated target bonus. In addition, (i) any shares of restricted
stock outstanding on the date of his termination will become fully
vested and non-forfeitable as of his date of termination; and (ii)
the vested portion of any stock options outstanding on the date of
his termination will remain exercisable for a period of 24 months
following the date of his termination (or, if earlier, the normal
expiration date of such stock options), and any unvested portion of
outstanding stock options will lapse as of the date of
termination.
If Mr.
Weiss’ employment is terminated by the Company for Cause or
by Mr. Weiss without Good Reason, Mr. Weiss will receive his
accrued obligations but no additional benefits. Any shares of
restricted stock outstanding on the date of his termination will be
forfeited. The vested portion of any stock options outstanding on
the date of his termination will remain exercisable for a period of
thirty (30) days following the date of his termination (or, if
earlier, the normal expiration date of such stock options), and any
unvested portion of outstanding stock options will lapse as of the
date of termination.
During
his employment and for 12 months following the termination of his
employment for any reason, Mr. Weiss is prohibited from engaging in
any business that develops anti-CD20 monoclonal antibodies within
the geographic area in which the Company does business, which is
deemed to be worldwide, and he is subject to a non-disparagement
clause. He is also subject to certain covenants related to
confidential information, trade secrets, return of property, and
invention assignment.
19
Effective as of
January 1, 2017, we entered into an amendment (the
“Amendment”) to Mr. Weiss’ employment
agreement. Under the Amendment, Mr. Weiss will remain as
Chief Executive Officer and President, removing the interim status.
Simultaneously, we entered into a Strategic Advisory Agreement (the
“Advisory Agreement”) with Caribe BioAdvisors, LLC (the
“Advisor”) owned by Mr. Weiss to provide the services
of Mr. Weiss as Chairman of the Board and as Executive Chairman.
Pursuant to the Advisory Agreement, the Advisor will be paid an
annual cash advisory fee initially of $100,000. The annual cash
advisory fee under the Advisory Agreement will be directly tied to
our market capitalization, providing for an escalating annual cash
advisory fee when our market capitalization is greater than $500
million up to a maximum annual fee of $1.5 million if our market
capitalization reaches $3 billion. The cash compensation due to Mr.
Weiss and the Advisor will be less than the potential cash
compensation due to Mr. Weiss prior to the Amendment and Advisory
Agreement until the time the market capitalization of the Company
exceeds $750 million, with the initial cash savings to us being up
to $275,000 annually.
As part
of the Amendment, Mr. Weiss also agreed to forfeit 3,381,866
restricted shares previously granted under his employment agreement
that were predominantly subject to time-based vesting over three
years. Simultaneously, (i) Mr. Weiss is being issued 418,371
restricted shares under his employment agreement that vest in 2018
and 2019 and (ii) the Advisor is being issued 2,960,000 restricted
shares under the Advisory Agreement that vest on market
capitalization thresholds that range from $375 million to $750
million. Collectively, Mr. Weiss and the Advisor will be granted
fewer shares than Mr. Weiss forfeited.
Sean A. Power.
Mr.
Power was appointed Chief Financial Officer, Treasurer and
Secretary of the Company, effective December 29, 2011. Under Mr.
Power’s employment agreement, Mr. Power is to serve as the
Company’s Chief Financial Officer, Treasurer and Secretary
until such employment is terminated pursuant to the terms of the
agreement. Mr. Power’s base salary for 2015 was $225,000. Mr.
Power is also eligible to earn an annual cash performance bonus,
based upon achievement of annual performance goals and objectives
set by agreement between Mr. Power and the board each year, with a
target bonus of 33% of his base salary.
The
Company will grant Mr. Power a number of shares of restricted
common stock of the Company as determined by the CEO and the Board.
Each of these annual grants of restricted stock will be subject to
vesting terms, which will be determined at the time of grant by the
CEO and the Board.
Pursuant to his
employment agreement, if Mr. Power’s employment is terminated
by the Company without Cause (as defined therein) or if Mr. Power
resigns for Good Reason (as defined therein), then, in addition to
his accrued obligations, if within 45 days after the date of
termination, he executes and does not revoke a general release of
claims and covenant not to sue, he will receive the following
severance benefits: (i) a lump sum severance payment equal to 0.5
times the sum of his base salary and target bonus (or 1 times the
sum of his base salary and target bonus if his employment is
terminated upon or following a change in control); (ii)
continuation of group health benefits for 12 months; (iii) a
prorated target bonus; (iv) any shares of restricted stock
outstanding on the date of his termination will become fully-vested
and non-forfeitable as of his date of termination; and (v) any
stock options outstanding on the date of his termination will
become fully-vested and will remain exercisable for a period of 12
months following the date of his termination (or, if earlier, the
normal expiration date of such stock options).
If Mr.
Power’s employment is terminated by reason of his death or
disability, he will be entitled to his accrued obligations and a
prorated target bonus. In addition, (i) any shares of restricted
stock outstanding on the date of his termination will become fully
vested and non-forfeitable as of his date of termination; and (ii)
the vested portion of any stock options outstanding on the date of
his termination will remain exercisable for a period of 12 months
following the date of his termination (or, if earlier, the normal
expiration date of such stock options), and any unvested portion of
outstanding stock options will lapse as of the date of
termination.
If Mr.
Power’s employment is terminated by the Company for Cause or
by Mr. Power without Good Reason, Mr. Power will receive his
accrued obligations but no additional benefits. Any shares of
restricted stock outstanding on the date of his termination will be
forfeited. The vested portion of any stock options outstanding on
the date of his termination will remain exercisable for a period of
thirty (30) days following the date of his termination (or, if
earlier, the normal expiration date of such stock options), and any
unvested portion of outstanding stock options will lapse as of the
date of termination.
During
his employment and for 12 months following the termination of his
employment for any reason, Mr. Power is prohibited from engaging in
any business that develops anti-CD20 monoclonal antibodies within
the geographic area in which the Company does business, which is
deemed to be worldwide, and he is subject to a non-disparagement
clause. He is also subject to certain covenants related to
confidential information, trade secrets, return of property, and
invention assignment.
20
Potential Payments upon Termination or Change in
Control
As
detailed above, we have employment agreements with Mr. Weiss and
Mr. Power that provide certain compensation and benefits in the
event of the termination of their employment under certain
conditions. In addition, our equity plan provides certain benefits
in connection with a change in control.
Equity Plan
Pursuant to the
terms of the 2012 Incentive Plan, upon the occurrence of a change
in control, any awards outstanding under such plan will become
fully-vested.
Michael S. Weiss
The
table below summarizes the value of potential payments and benefits
that Mr. Weiss would receive if his employment was terminated on
December 31, 2016 under the circumstances shown, or if a change in
control of the Company occurred on December 31, 2016. The table
excludes amounts that would be paid in the normal course of
continued employment, such as accrued but unpaid salary. Actual
amounts to be paid can only be determined at the time of such
termination of service.
|
Type
of Payment
|
Death
or Disability
|
Termination
for Cause or Resignation without Good Reason
|
Termination
Other Than For Cause; Resignation for Good Reason
|
Termination
Other Than For Cause; Resignation For Good Reason (Following a
Change in Control)
|
Change
in Control (Absent Termination)
(2)
|
|
|
($)
|
($)
|
($)
|
($)
|
($)
|
|
Cash
Severance
|
-
|
-
|
1,125,000
|
1,500,000
|
-
|
|
Pro-Rated Target
Bonus
|
375,000
|
-
|
375,000
|
375,000
|
-
|
|
Continuation of
Health Benefits
|
-
|
-
|
34,884
|
46,512
|
-
|
|
Value of
Accelerated Equity
(1)
|
18,951,614
|
-
|
18,951,614
|
18,951,614
|
18,951,614
|
|
Total
|
19,326,614
|
-
|
20,486,498
|
20,873,126
|
18,951,614
|
|
(1)
|
Represents
the fair market value of restricted shares that would be vested
upon the event, based on the closing price of our stock on December
31, 2016 ($4.65), the last trading day of the most recently
completed fiscal year.
|
|
(2)
|
Our
2012 Incentive Plan specifies that all outstanding unvested stock
awards vest upon a qualifying change in control.
|
Sean A. Power
The
table below summarizes the value of potential payments and benefits
that Mr. Power would receive if his employment was terminated on
December 31, 2016 under the circumstances shown, or if a change in
control of the Company occurred on December 31, 2016. The table
excludes amounts that would be paid in the normal course of
continued employment, such as accrued but unpaid salary. Actual
amounts to be paid can only be determined at the time of such
termination of service.
|
Type
of Payment
|
Death
or Disability
|
Termination
for Cause or Resignation without Good Reason
|
Termination
Other Than For Cause; Resignation for Good Reason
|
Termination
Other Than For Cause; Resignation For Good Reason (Following a
Change in Control)
|
Change
in Control (Absent Termination)
(2)
|
|
|
($)
|
($)
|
($)
|
($)
|
($)
|
|
Cash
Severance
|
-
|
-
|
199,500
|
399,000
|
-
|
|
Pro-Rated Target
Bonus
|
99,000
|
-
|
99,000
|
99,000
|
-
|
|
Continuation of
Health Benefits
|
-
|
-
|
23,256
|
23,256
|
-
|
|
Value of
Accelerated Equity
(1)
|
1,003,623
|
-
|
1,003,623
|
1,003,623
|
1,003,623
|
|
Total
|
1,102,623
|
-
|
1,325,379
|
1,524,879
|
1,003,623
|
|
(1)
|
Represents
the fair market value of restricted shares that would be vested
upon the event, based on the closing price of our stock on December
31, 2016 ($4.65), the last trading day of the most recently
completed fiscal year.
|
|
(2)
|
Our
2012 Incentive Plan specifies that all outstanding unvested stock
awards vest upon a qualifying change in control.
|
21
DIRECTOR COMPENSATION
Cash Compensation.
Our non-employee directors receive the
following cash compensation: (i) $50,000 annual retainer; and (ii)
$10,000 additional retainer for service as Chairman of the Audit
Committee. Each non-employee director receives reimbursement for
reasonable travel expenses incurred in attending meetings of our
Board of Directors and meetings of committees of our Board of
Directors.
Equity Compensation.
Our non-employee directors receive the
following equity compensation under the 2012 Incentive
Plan.
●
Initial Stock
Grant.
Non-employee directors
receive 50,000 shares of restricted common stock upon initial
election or appointment to the Board of Directors. The stock will
vest in equal annual installments over three years, beginning on
the third anniversary of the date of grant.
●
Annual Stock
Grant.
Non-employee directors
receive a restricted stock award of $75,000 of restricted stock
annually for service on our Board of Directors. Such restricted
stock will vest on the third anniversary of the date of
grant.
2016 Director Compensation
The
following table sets forth the cash and other compensation paid by
the Company to the non-employee members of the Board for all
services in all capacities during 2016.
|
Name
|
|
Fees Earned or Paid in Cash
($) (1)
|
Stock Awards
($) (2)
|
Option Awards ($)
|
Total ($)
|
|
Laurence N.
Charney
|
|
60,000
|
75,003
|
--
|
135,003
|
|
William J.
Kennedy
|
|
50,000
|
75,003
|
--
|
125,003
|
|
Mark Schoenebaum,
M.D.
|
|
50,000
|
75,003
|
--
|
125,003
|
|
Yann
Echelard
|
|
50,000
|
75,003
|
--
|
125,003
|
|
Kenneth
Hoberman
|
|
50,000
|
75,003
|
--
|
125,003
|
|
Daniel
Hume
|
|
50,000
|
75,003
|
--
|
125,003
|
|
|
|
|
|
|
|
_______________________
(1)
Represents
cash retainer for serving on our Board and committees of the
Board.
(2)
Reflects
the aggregate grant date fair value of stock awards granted by the
Company as computed under FASB ASC Topic 718. The grant date fair
value of the stock awards is based on the fair market value of the
underlying shares on the date of grant and does not take into
account any estimated forfeitures.
22
The
following table shows the number of stock awards granted to each
director during 2016, and the grant date fair value for each award
(determined in accordance with FASB ASC Topic 718) (during 2016 no
option awards were granted to directors):
|
Name
|
|
Grant Date
|
|
Stock Awards (#)
|
|
Grant Date Fair Value of Awards ($)
|
|
Laurence N.
Charney
|
|
7/6/16
|
|
12,459
|
|
75,003
|
|
William
J. Kennedy
|
|
7/6/16
|
|
12,459
|
|
75,003
|
|
Mark
Schoenebaum, M.D.
|
|
7/6/16
|
|
12,459
|
|
75,003
|
|
Yann
Echelard
|
|
7/6/16
|
|
12,459
|
|
75,003
|
|
Kenneth
Hoberman
|
|
7/6/16
|
|
12,459
|
|
75,003
|
|
Daniel
Hume
|
|
7/6/16
|
|
12,459
|
|
75,003
|
As
of December 31, 2016, the following aggregate number of unvested
restricted stock awards were held by each of our non-employee
directors. No stock options have been granted to our non-employee
directors.
|
Name
|
Stock
awards (#)
|
|
Laurence N.
Charney
|
70,878
|
|
William
J. Kennedy
|
45,331
|
|
Mark
Schoenebaum, M.D.
|
95,949
|
|
Yann
Echelard
|
87,068
|
|
Kenneth
Hoberman
|
67,126
|
|
Daniel
Hume
|
62,459
|
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER
PARTICIPATION
The
current members of our Compensation Committee are Kenneth Hoberman,
Laurence Charney, William Kennedy, Mark Schoenebaum and Daniel
Hume. No member of our Compensation Committee during fiscal year
2016 or as of the date of this proxy statement, is or has been an
officer or employee of TG Therapeutics or any of our subsidiaries,
nor has any member of our Compensation Committee had any
relationship with TG Therapeutics requiring further
disclosure.
During
the last fiscal year, none of our executive officers served as a
director or member of the Compensation Committee (or other
committee serving an equivalent function) of any other entity,
whose executive officers either served as a member of our
Compensation Committee or our Board of Directors.
23
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING
COMPLIANCE
Section 16(a) of the Exchange Act requires our directors, executive
officers and persons who own more than 10% of the shares of our
common stock to file an initial report of ownership on Form 3 and
changes in ownership on Form 4 or Form 5 with the SEC. Such
officers, directors and 10% stockholders are also required by SEC
rules to furnish us with copies of any Forms 3, 4 or 5 that they
file. The SEC rules require us to disclose late filings of initial
reports of stock ownership and changes in stock ownership by our
directors, executive officers and 10% stockholders. Based solely on
a review of copies of the Forms 3, 4 and 5 furnished to us by
reporting persons and any written representations furnished by
certain reporting persons, we believe that during the fiscal year
ended December 31, 2016, all Section 16(a) filing requirements
applicable to our directors, executive officers and 10%
stockholders were completed in a timely manner.
RELATED-PERSON
TRANSACTIONS
On
January 30, 2012, we entered into an exclusive license agreement
with LFB Biotechnologies, GTC Biotherapeutics and LFB/GTC LLC, all
wholly-owned subsidiaries of LFB Group, relating to the development
of ublituximab (the “LFB License Agreement”). In
connection with the LFB License Agreement, LFB Group was issued
5,000,000 shares of common stock, and a warrant to purchase
2,500,000 shares of common stock at a purchase price of $0.001 per
share. In addition, under the terms of the LFB License Agreement,
on November 9, 2012, we nominated Dr. Yann Echelard to our Board of
Directors as LFB Group’s nominee. LFB Group maintains the
right to nominate a board member until such time as LFB Group owns
less than 10% of our outstanding common stock.
In
connection with the LFB License Agreement, LFB Group maintained the
right to purchase at least $750,000 in additional shares of common
stock at a purchase price per share as defined in a November 2012
securities exchange agreement. Accordingly, in February 2015, LFB
Group purchased 114,855 shares of our common stock at a price of
$6.53 per share for net proceeds of $750,000. In May 2015, LFB
Group exercised its warrant to purchase 2,500,000 shares of common
stock at a purchase price of $0.001 per share.
Under
the terms of the LFB License Agreement, we utilize LFB Group for
certain development and manufacturing services. We incurred
approximately $8,100,000, $9,300,000 and $5,200,000 in expenses for
such services during the years ended December 31, 2016, 2015 and
2014, respectively. As of December 31, 2016, and 2015, we had
approximately $0.4 million and $2.1 million, respectively, recorded
in accounts payable related to the LFB License Agreement. In
conjunction with the development and manufacturing services
discussed above, certain agreements between us and LFB Group
require payments in advance of services performed or goods
delivered. Accordingly, as of December 31, 2016 and 2015, we
recorded $1.3 million and $3.0 million, respectively, in prepaid
research and development for such advance payments.
In
March 2014, we entered into a shared services agreement (the
“Opus Shared Services Agreement”) with Opus Point
Partners Management, LLC (“Opus”) in which the parties
agreed to share a rented facility and costs for certain other
services. Michael S. Weiss, our Executive Chairman and CEO, is a
Managing Member of Opus. During the years ended December 31, 2016
and 2015, we incurred expenses of approximately $0.3 million and
$0.1 million, respectively, principally for rent, related to this
Opus Shared Services Agreement. As of December 31, 2016 and 2015,
we had $0 and approximately $0.1 million, respectively, recorded in
accounts payable related to this Opus Shared Services Agreement.
The Opus Shared Services Agreement is no longer in effect as we
began occupying new space in April 2016.
24
In
connection with our licensing agreement with Ligand Pharmaceuticals
Incorporated, which we entered into in June 2014,
Opus, who identified the opportunity and advised
us on the transaction, will be entitled to receive a 1% royalty for
annual sales of up to $1 billion.
During the years ended
December 31, 2016 and 2015, no royalties were paid to Opus under
this agreement.
In October 2014, we entered into an agreement (the “Office
Agreement”) with Fortress Biotech, Inc. (“FBIO”)
to occupy approximately 45% of the 24,000 square feet of New York
City office space leased by FBIO, which is now our corporate
headquarters. The Office Agreement requires us to pay our
respective share of the average annual rent and other costs of the
15-year lease. We approximate an average annual rental obligation
of $1.1 million under the Office Agreement. We began to occupy this
new space in April 2016, with rental payments beginning in the
third quarter of 2016. During the year ended December 31, 2016, we
recorded rent expense of approximately $1.4 million and at December
31, 2016, have deferred rent of approximately $0.8 million. Mr.
Weiss, our Executive Chairman and CEO, is also Executive Vice
Chairman of FBIO.
During the year ended December 31, 2016, we agreed to pay FBIO $2.2
million for our portion of the build-out costs, which have been
allocated to us at the 45% rate mentioned above. After an initial
commitment period of the 45% rate for a period of three years, we
and FBIO will determine actual office space utilization annually
and if our utilization differs from the amount we have been billed,
we will either receive credits or be assessed incremental
utilization charges. Also in connection with this lease, in October
2014 we pledged $0.6 million to secure a line of credit as a
security deposit for the Office Agreement.
In July 2015, we entered into a Shared Services Agreement (the
“Shared Services Agreement”) with FBIO to share the
cost of certain services such as facilities use, personnel costs
and other overhead and administrative costs. This Shared Services
Agreement requires us to pay our respective share of services
utilized. In connection with the Shared Services Agreement, we
incurred expenses of approximately $0.8 million and $0.1 million
for shared services for the years ended December 31, 2016 and 2015,
primarily related to shared personnel. As of December 31, 2016, we
had approximately $0.4 million recorded in accounts payable related
mostly to the Shared Services Agreement, and no amounts were due at
December 31, 2015.
In May
2016, as part of a broader agreement with Jubilant Biosys Limited
(“Jubilant”), an India-based biotechnology company,
we entered into a
sub-license agreement (“JBET Agreement”) with
Checkpoint Therapeutics, Inc. (“Checkpoint”), a
subsidiary of FBIO, for the development and commercialization of
Jubilant’s novel BET inhibitor program in the field of
hematological malignancies.
We paid Checkpoint an up-front
licensing fee of $1.0 million as part of the JBET Agreement. As of
December 31, 2016, we had approximately $0.8 million recorded in
accounts payable, related to the JBET Agreement. Mr. Weiss is also
the Executive Chairman of Checkpoint.
On
September 1, 2015, we paid $25,000 to Checkpoint Therapeutics, Inc.
(“Checkpoint”) as an option fee for the exclusive right
to enter into a collaboration for certain additional compounds
licensed by Checkpoint. The option has not been exercised as of
December 31, 2016.
For the
year ended December 31, 2016, we incurred expenses of approximately
$4,000 to AOI Communications, L.P. for manuscript services related
to TG-1101. Mr. Weiss is the owner of AOI Communications,
L.P.
25
STOCK OWNERSHIP OF OUR DIRECTORS, EXECUTIVE OFFICERS,
AND 5% BENEFICIAL OWNERS
The
following table shows information, as of April 18, 2017, concerning
the beneficial ownership of our common stock by:
●
each person we know
to be the beneficial owner of more than 5% of our common
stock;
●
each of our current
directors;
●
each of our NEOs
shown in our Summary Compensation Table; and
●
all current
directors and NEOs as a group.
As of
April 18, 2017, there were 66,816,455 shares of our common stock
outstanding. In order to calculate a stockholder’s percentage
of beneficial ownership, we include in the calculation those shares
underlying options or warrants beneficially owned by that
stockholder that are vested or that will vest within 60 days of
April 18, 2017. Shares of restricted stock are deemed to be
outstanding. Options or warrants held by other stockholders that
are not attributed to the named beneficial owner are disregarded in
this calculation. Beneficial ownership is determined in accordance
with the rules of the SEC and includes voting or investment power
with respect to the shares of our common stock. Unless we have
indicated otherwise, each person named in the table below has sole
voting power and investment power for the shares listed opposite
such person’s name, except to the extent authority is shared
by spouses under community property laws.
|
Name and Address of Beneficial Owner
(1)
|
|
Amount and Nature
of Beneficial
Ownership
|
|
Percentage of
Shares
Outstanding
|
|
Michael
S. Weiss
(2)
|
|
10,145,197
|
|
15.2%
|
|
Sean A.
Power
(3)
|
|
507,440
|
|
*
|
|
Laurence
Charney
|
|
88,949
|
|
*
|
|
William
Kennedy
|
|
70,401
|
|
*
|
|
Mark
Schoenebaum
|
|
95,949
|
|
*
|
|
Yann
Echelard
|
|
87,068
|
|
*
|
|
Kenneth
Hoberman
|
|
86,905
|
|
*
|
|
Daniel
Hume
|
|
62,459
|
|
*
|
|
All
current directors and named executive officers as a group (8
persons)
|
|
11,144,368
|
|
16.7%
|
|
|
|
|
|
|
|
5% Stockholders:
|
|
|
|
|
|
Opus
Point Partners, LLC
(4)
|
|
10,145,197
|
|
15.2%
|
|
LFB
Biotechnologies, S.A.S.
(5)
|
|
7,614,855
|
|
11.4%
|
|
FMR LLC
(6)
|
|
6,451,713
|
|
9.7%
|
|
Bridger
Management LLC
(7)
|
|
4,921,059
|
|
7.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
*
Less than 1% of
outstanding common stock.
(1)
The address of each
of the directors and officers listed is c/o TG Therapeutics, Inc.,
2 Gansevoort Street, 9th Floor, New York, New York
10014.
(2)
Includes 765,246
shares of unvested restricted common stock, which vest on various
time-based milestones. Finally, also included in Mr. Weiss’
beneficial ownership are 4,524,560 shares of our common stock
(1,500,000 of which contain restrictions based upon various
corporate milestones) issued to Opus Point Partners, LLC, of which
Mr. Weiss is a co-founder, managing partner, and principal and
beneficially owns a 50% interest.
(3)
Includes 200,833
shares of restricted common stock, of which 170,833 vest on various
time-based milestones, and 30,000 of which vest on various
corporate milestones.
26
(4)
T
he address of Opus
Point Partners, LLC is 2 Gansevoort Street, 9th Floor, New York,
New York 10014. Includes 4,524,560 shares of our common stock
(1,500,000 of which contain restrictions based upon various
corporate milestones) issued to Opus Point Partners, LLC. Also
includes shares beneficially owned by Mr. Weiss as outlined in
footnote 2 above. Mr. Weiss is a co-founder, managing partner, and
principal and beneficially owns a 50% interest in Opus Point
Partners, LLC.
(5)
The address of LFB
Biotechnologies, S.A.S. is 3 avenue des Tropiques, BP 40305 Les
Ulis, 91942 Courtaboeuf Cedex, France.
(6)
The address of FMR,
LLC is 245 Summer Street, Boston, Massachusetts 02210. Share
ownership reported above is based on a Form 13G/A filed by FMR, LLC
on April 10, 2017.
(7)
The address of
Bridger Management, LLC is 90 Park Avenue, 40
th
Floor, New York, NY
10016. Share ownership reported above is based on a Form 13G/A
filed by Bridger Management, LLC on February 14, 2017.
27
PROPOSAL ONE
ELECTION OF DIRECTORS; NOMINEES
Our
Amended and Restated Bylaws provide that the Board shall consist of
one or more members, as determined from time to time by resolution
of the Board. Our Board currently consists of seven members. The
nominated directors are: Michael S. Weiss, Laurence N. Charney,
William J. Kennedy, Mark Schoenebaum M.D., Yann Echelard, Kenneth
Hoberman, and Daniel Hume. For information about each of the
nominees and our Board generally, please see “Corporate
Governance-Our Board of Directors” beginning on page 4. If
elected, the nominees will hold office until the next annual
meeting and until a respective successor is elected and has been
qualified, or until such director resigns or is removed from
office. Management expects that each of the nominees will be
available for election, but if any of them is unable to serve at
the time the election occurs, your proxy will be voted for the
election of another nominee to be designated by a majority of the
independent directors serving on our Board.
THE
BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR”
THE ELECTION OF ALL OF THE NOMINEES FOR DIRECTOR. IF A CHOICE IS
SPECIFIED ON THE PROXY BY THE STOCKHOLDER, THE SHARES WILL BE VOTED
AS SPECIFIED. IF NO SPECIFICATION IS MADE, THE SHARES WILL BE VOTED
“FOR” ALL OF THE NOMINEES. THE AFFIRMATIVE VOTE OF THE
HOLDERS OF A PLURALITY OF THE SHARES OF COMPANY COMMON STOCK
REPRESENTED AND ENTITLED TO VOTE AT THE ANNUAL MEETING AT WHICH A
QUORUM IS PRESENT IS REQUIRED FOR THE ELECTION OF THE
NOMINEES.
28
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF COHNREZNICK LLP
AS OUR
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The
Board is submitting the selection of CohnReznick LLP as our
independent registered public accounting firm to the stockholders
for ratification at our Annual Meeting. Stockholder ratification of
our independent registered public accounting firm is not required
by our Amended and Restated Bylaws or otherwise. If CohnReznick LLP
is not ratified as our independent registered public accounting
firm by a majority of the shares present or represented by proxy,
the Audit Committee will review its future selection of independent
registered public accounting firm. CohnReznick LLP will still serve
as our independent registered public accounting firm for the year
ending December 31, 2017, if it is not ratified by our
stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A
VOTE “FOR” RATIFICATION OF THE APPOINTMENT OF
COHNREZNICK LLP
AS THE
COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR
THE YEAR ENDING DECEMBER 31, 2017. THE AFFIRMATIVE VOTE OF THE
MAJORITY OF SHARES PRESENT IN PERSON OR REPRESENTED BY PROXY AT THE
MEETING AND ENTITLED TO VOTE ON THE SUBJECT MATTER IS REQUIRED FOR
THE RATIFICATION OF THE APPOINTMENT OF COHNREZNICK
LLP.
29
ADDITIONAL INFORMATION
Householding of Annual Meeting Materials
Some
banks, brokers and other nominee record holders may be
participating in the practice of “householding” proxy
statements and annual reports. This means that only one copy of our
proxy statement and 2016 Annual Report may have been sent to
multiple stockholders in your household. We will promptly deliver a
separate copy of either document to you if you contact us at: TG
Therapeutics, Inc., 2 Gansevoort Street, 9
th
Floor, New York,
New York 10014, Attn: Sean A. Power. You may also contact us at
(212) 554-4484.
If you
want to receive separate copies of the proxy statement and annual
report in the future, or if you are receiving multiple copies and
would like to receive only one copy for your household, you should
contact your bank, broker, or other nominee record holder, or you
may contact us at the above address or phone number.
Stockholder Proposals for Our 2018 Annual
Meeting
Only
proper proposals under Rule 14a-8 of the Exchange Act which are
timely received will be included in the proxy materials for our
next annual meeting. In order to be considered timely, such
proposal must be received by our Corporate Secretary, Sean A.
Power, at 2 Gansevoort Street, 9
th
Floor, New York,
New York 10014, no later than December 29, 2017. We suggest that
stockholders submit any stockholder proposal by certified mail,
return receipt requested.
Our
Amended and Restated Bylaws require stockholders to provide advance
notice to the Company of any stockholder director nomination(s) and
any other matter a stockholder wishes to present for action at an
annual meeting of stockholders (other than matters to be included
in our proxy statement, which are discussed in the previous
paragraph). In order to properly bring business before an annual
meeting, our Amended and Restated Bylaws require, among other
things, that the stockholder submit written notice thereof
complying with our Amended and Restated Bylaws to Sean A. Power,
our Corporate Secretary, at the above address, not less than 60
days nor more than 90 days prior to the anniversary of the
preceding year’s annual meeting. Therefore, the Company must
receive notice of a stockholder proposal submitted other than
pursuant to Rule 14a-8 (as discussed above) no sooner than March
15, 2018, and no later than April 14, 2018. If a stockholder fails
to provide timely notice of a proposal to be presented at our 2018
Annual Meeting of Stockholders, the proxy designated by our Board
will have discretionary authority to vote on any such proposal that
may come before the meeting.
Other Matters
Our
Board does not know of any other matters that may come before the
meeting. However, if any other matters are properly presented to
the meeting, it is the intention of the person named in the
accompanying proxy card to vote, or otherwise act, in accordance
with their judgment on such matters.
Solicitation of Proxies
We will
bear the cost of solicitation of proxies. In addition to the
solicitation of proxies by mail, our officers and employees may
solicit proxies in person or by telephone. We may reimburse brokers
or persons holding stock in their names, or in the names of their
nominees, for their expenses in sending proxies and proxy material
to beneficial owners.
Incorporation of Information by Reference
The
Audit Committee Report contained in this proxy statement is not
deemed filed with the SEC and shall not be deemed incorporated by
reference into any prior or future filings made by us under the
Securities Act of 1933, as amended or the Exchange Act, except to
the extent that we specifically incorporate such information by
reference. Our Annual Report on Form 10-K for the year ended
December 31, 2016, delivered to you together with this proxy
statement, is hereby incorporated by reference.
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