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Share Name | Share Symbol | Market | Type |
---|---|---|---|
GenMark Diagnostics Inc | NASDAQ:GNMK | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 24.05 | 23.92 | 24.39 | 0 | 01:00:00 |
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
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Title of each class of securities to which transaction applies:
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Aggregate number of securities to which transaction applies:
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3)
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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):
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4)
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Proposed maximum aggregate value of transaction:
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5)
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Total fee paid:
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Fee paid previously with preliminary materials.
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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.
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1)
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Amount Previously Paid:
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2)
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Form, Schedule or Registration Statement No.:
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3)
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Filing Party:
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4)
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Date Filed:
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1.
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To elect Lisa M. Giles and Michael S. Kagnoff as Class III directors to hold office for a term of three years.
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2.
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To ratify the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2016.
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3.
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To approve, on an advisory basis, the compensation of the Company’s named executive officers.
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4.
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To transact such other business as may properly come before the meeting or any adjournment or postponement of the meeting.
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Page
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ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 26, 2016
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1
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GENERAL
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1
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QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING
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1
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BOARD OF DIRECTORS INFORMATION
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4
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CORPORATE GOVERNANCE
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8
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COMMUNICATIONS WITH DIRECTORS
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10
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
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11
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EXECUTIVE OFFICERS
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14
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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
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16
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
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17
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EQUITY COMPENSATION PLAN INFORMATION
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17
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EXECUTIVE COMPENSATION
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18
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DIRECTOR COMPENSATION
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38
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REPORT OF THE COMPENSATION COMMITTEE
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39
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
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39
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REPORT OF THE AUDIT COMMITTEE
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39
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PROPOSAL 1-ELECTION OF DIRECTORS
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42
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PROPOSAL 2 - RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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43
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PROPOSAL 3-ADVISORY VOTE ON COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS
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44
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OTHER MATTERS
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45
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STOCKHOLDERS SHARING THE SAME ADDRESS
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45
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1.
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What is the purpose of the Annual Meeting?
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2.
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Who is soliciting the proxies?
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3.
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Why did I receive a notice in the mail regarding the internet availability of proxy materials (the “
Notice
”) instead of a full set of proxy materials?
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4.
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How do I get electronic access to the proxy materials?
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5.
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Who is entitled to vote?
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6.
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Is cumulative voting permitted for the election of directors?
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7.
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How do I vote?
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8.
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Can I change my vote after I submit my proxy?
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9.
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How are the votes counted and what vote is needed to approve each of the proposals?
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10.
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How does the Board recommend that I vote?
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•
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FOR
THE PROPOSED NOMINEES FOR ELECTION TO THE BOARD;
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•
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FOR
THE RATIFICATION OF THE APPOINTMENT OF ERNST & YOUNG LLP; AND
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•
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FOR
THE APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS.
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11.
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How many shares must be present to hold the Annual Meeting?
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12.
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Who pays the costs of the proxy solicitation?
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13.
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Could other matters be presented for a vote at the Annual Meeting?
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14.
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Where can I find the voting results of the Annual Meeting?
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15.
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How do I make a stockholder proposal or nominate an individual to serve as a director for next year’s annual meeting of stockholders?
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Audit Committee
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Compensation
Committee
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Corporate
Governance and
Nominating Committee
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Dr. Fox (Chairman)*
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X
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Chair
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X
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Mr. Faulkner*
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—
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X
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Chair
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Ms. Giles*(1)
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X
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—
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—
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Mr. Kagnoff*(1)
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—
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—
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X
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Mr. Massarany
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—
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—
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—
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Mr. O’Boyle*
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Chair
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X
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—
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*
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Independent director under NASDAQ and SEC rules.
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•
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forward the communication to the director or directors to whom it is addressed;
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•
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forward the communication to the appropriate management personnel;
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•
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attempt to handle the inquiry directly, for example where it is a request for information about the Company, or it is a stock related matter; or
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•
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not forward the communication if it is primarily commercial in nature or if it relates to an improper or irrelevant topic.
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Name and Address of Beneficial Owner (1)
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Amount and Nature of
Beneficial Ownership (2)
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Percent of
Class
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Principal Stockholders
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FMR LLC
(3)
245 Summer Street
Boston, MA 02210
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6,366,408
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14.89
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%
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Putnam Investments, LLC
(4)
One Post Office Square
Boston, MA 02109
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6,013,182
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14.07
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%
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Cadian Capital Management, LP
(5)
535 Madison Avenue, 36th Floor
New York, NY 10022
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3,765,159
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8.81
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%
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JPMorgan Chase & Co.
(6)
270 Park Avenue
New York, NY 10017
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3,265,474
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7.64
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%
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Prudential Financial, Inc.
(7)
751 Broad Street
Newark, NJ 07102
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3,147,834
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7.36
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%
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Jennison Associates LLC
(8)
466 Lexington Avenue
New York, NY 10017
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3,144,434
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7.35
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%
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T. Rowe Price Associates, Inc.
(9)
100 East Pratt Street
Baltimore, MD 21202
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2,582,854
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6.04
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%
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Artisan Partners Holdings LP
(10)
875 East Wisconsin Avenue, Suite 800
Milwaukee, WI 53202
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2,233,358
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5.22
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%
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Adage Capital Partners GL LLC
(11)
200 Clarendon Street, 52nd Floor
Boston, MA 02116
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2,225,036
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5.20
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%
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Black Rock Inc.
(12)
55 East 52nd Street
New York, NY 10055
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2,202,443
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5.15
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%
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Name and Address of Beneficial Owner (1)
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Amount and Nature of
Beneficial Ownership (2)
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Percent of
Class
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Directors and Named Executive Officers
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James Fox, Ph.D.
(13)
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148,649
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*
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Daryl Faulkner
(14)
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102,817
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*
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Lisa M. Giles
(15)
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11,789
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*
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Michael S. Kagnoff
(16)
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19,497
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*
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Kevin C. O’Boyle
(17)
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97,460
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*
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Hany Massarany
(18)
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890,257
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2.06
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%
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Scott Mendel
(19)
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98,921
|
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*
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Ingo Chakravarty
(20)
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99,204
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*
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Michael Gleeson
(21)
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235,550
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*
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Eric Stier
(22)
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88,534
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*
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All directors and executive officers as a group
(12 persons)
(23)
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3,124,304
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7.09
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%
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*
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Represents beneficial ownership of less than 1% of the outstanding shares of our common stock.
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(1)
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Unless otherwise indicated, the address of each beneficial owner is c/o GenMark Diagnostics, Inc., 5964 La Place Court, Carlsbad, California 92008.
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(2)
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Beneficial ownership of shares and percentage ownership are determined in accordance with the rules of the SEC. In calculating the number of shares beneficially owned by an individual or entity and the percentage ownership of that individual or entity, shares underlying stock options held by that individual or entity that are either currently exercisable or exercisable within 60 days from February 15, 2016 are deemed outstanding. These shares, however, are not deemed outstanding for the purpose of determining the percentage ownership of any other individual or entity. Unless otherwise indicated and subject to community property laws where applicable, the individuals and entities named in the table above have sole voting and investment power with respect to all shares of our common stock shown as beneficially owned by them.
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(3)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on February 12, 2016 by FMR LLC (“
FMR
”), Abigail P. Johnson, and Select Health Care Portfolio. FMR has the sole power to vote or direct the vote of 578,048 shares and the sole power to dispose or direct the disposition of 6,366,408 shares. Abigail P. Johnson is a Director, the Vice Chairman, the Chief Executive Officer and the President of FMR. Members of the Johnson family, including Abigail P. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR, representing 49% of the voting power of FMR. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders' voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR. Neither FMR nor Abigail P. Johnson has the sole power to vote or direct the voting of the shares owned directly by the various investment companies registered under the Investment Company Act (“
Fidelity Funds
”) advised by Fidelity Management & Research Company, a wholly owned subsidiary of FMR, which power resides with the Fidelity Funds' Boards of Trustees. Fidelity Management & Research Company carries out the voting of the shares under written guidelines established by the Fidelity Funds’ Boards of Trustees.
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(4)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on February 16, 2016 by Putnam Investments, LLC (“
Putnam
”). Putnam, in its capacity as a parent holding company, may be deemed to beneficially own 6,013,182 shares that are beneficially owned by its subsidiaries, as follows: Putnam Investment Management, LLC (5,792,265 shares); and Putnam Advisory Company, LLC (220,917 shares). Putnam has the sole power to vote or to direct the vote of 220,917 shares and the sole power to dispose or direct the disposition of 6,013,182 shares.
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(5)
|
The foregoing information is based solely upon information contained in a Schedule 13G filed with the SEC on February 12, 2016 by Cadian Capital Management, LP, Cadian Capital Management GP, LLC, and Eric Bannasch. All securities are directly held by advisory clients (the “
Advisory Clients
”) of Cadian Capital Management, LP (the “
Adviser
”). Pursuant to Investment Management Agreements, as amended, between the Advisory Clients and the Adviser, the Adviser exercises exclusive voting and investment power over securities directly held by the Advisory Clients. Cadian Capital Management GP, LLC is the general partner of the Adviser. Eric Bannasch is the sole managing member of Cadian Capital Management GP, LLC.
|
(6)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on January 16, 2016 by JPMorgan Chase & Co. on behalf of itself and its wholly owned subsidiaries JPMorgan Chase Bank, National Association, J.P. Morgan Investment Management Inc., and JPMorgan Asset Management (UK) Ltd. (collectively, “
JPMorgan
”). JPMorgan has the sole power to vote or to direct the vote of 2,930,204 shares, and sole power to dispose or direct the disposition of 3,265,474 shares.
|
(7)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on January 28, 2016 by Prudential Financial, Inc. (“
Prudential
”). Prudential, in its capacity as a parent holding company, may be deemed to beneficially own 3,147,834 shares that are beneficially owned by its subsidiaries as follows: Jennison Associates LLC (“
Jennison
”) (3,144,434 shares); and Quantitative Management Associates LLC (3,400 shares). Prudential has the sole power to vote or to direct the vote of 23,432 shares, the shared power to vote or to direct the vote of 3,124,402 shares, the sole power to dispose or direct the disposition of 23,432 shares, and the shared power to dispose or to direct the disposition of 3,124,402 shares. Because Prudential indirectly owns 100% of the equity interests of Jennison, Prudential may be deemed to have the power to exercise or direct the exercise of the voting and dispositive power that Jennison may be deemed to have with respect to the shares owned by the portfolio managed by Jennison. Jennison does not file jointly with Prudential; therefore, the shares reported on Jennison’s Schedule 13G/A may be included in the shares reported on Prudential’s Schedule 13G/A. See footnote 8 below.
|
(8)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on February 4, 2016 by Jennison. Jennison, in its capacity as an investment adviser, may be deemed to beneficially own 3,144,434 shares that are held of record by clients of Jennison. Jennison has the sole power to vote or direct the vote of all such shares, and the shared power to dispose or direct the disposition of all such shares. Jennison furnishes investment advice to several investment companies, insurance separate accounts, and institutional clients. As a result of its role as an investment adviser, Jennison may be deemed to be the beneficial owner of the shares of common stock held by the portfolios it manages. Because Prudential indirectly owns 100% of the equity interests of Jennison, Prudential may be deemed to have the power to exercise or direct the exercise of the voting and/or dispositive power that Jennison may be deemed to have with respect to the shares owned by the portfolios managed by Jennison. Jennison does not file jointly with Prudential; therefore, the shares reported on Jennison’s Schedule 13G may be included in the shares reported on Prudential’s Schedule 13G. See footnote 7 above.
|
(9)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on February 11, 2016 by T. Rowe Price Associates, Inc. (“
Price Associates
”) and certain of its affiliates. Price Associates has the power to vote or direct the vote of 402,200 shares and the sole power to dispose or direct the disposition of 2,582,854 shares. These shares are owned by various individual and institutional investors. Price Associates serves as an investment adviser with power to direct investments and/or sole power to vote the securities. For purposes of reporting requirements of the Exchange Act, Price Associates is deemed to be a beneficial owner of such securities; however, Price Associates expressly disclaims that it is, in fact, the beneficial owner of such securities.
|
(10)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on February 2, 2016 by Artisan Partners Holdings LP, Artisan Partners Asset Management Inc., Artisan Partners Limited Partnership (“
Artisan Partners
”), and Artisan Investments GP LLC (the general partner of Artisan Partners). Each of these persons and entities beneficially own the shares reported and have shared power to vote or direct the vote with respect to 1,701,477 shares and shared power to dispose or direct the disposition with respect to 2,233,358 shares.
|
(11)
|
The foregoing information is based solely upon information contained in a Schedule 13G/A filed with the SEC on February 16, 2016 by Adage Capital Partners, L.P. (“
ACP
”), Adage Capital Partners GP, L.L.C. (“
ACPGP
”), Adage Capital Advisors, L.L.C. (“
ACA
”), Robert Atchinson, and Phillip Gross. ACP has the power to dispose of and the power to vote the shares of common stock beneficially owned by it, which power may be exercised by its general partner, ACPGP. ACA, as managing member of ACPGP, directs ACPGP’s operations. Neither ACPGP nor ACA directly own any shares of common stock. By reason of the provisions of Rule 13d-3 of the Exchange Act, ACPGP and ACA may be deemed to beneficially own the shares owned by ACP. Each of ACP, ACPGP, ACA, Mr. Atchinson and Mr. Gross have shared power to vote or direct the vote, and shared power to dispose or direct the disposition with respect to, all shares reported.
|
(12)
|
The foregoing information is based solely upon information contained in a Schedule 13G filed with the SEC on January 28, 2016 by BlackRock, Inc., on behalf of itself and the following subsidiaries: BlackRock Advisors, LLC , BlackRock Asset Management Canada Limited, BlackRock Asset Mangement Schweiz AG, BlackRock Fund Advisors, BlackRock Institutional Trust Company, N.A., and BlackRock Investement Management, LLC. BlackRock, Inc. has sole voting and sole dispositive power with respect to all shares reported.
|
(13)
|
The amount reported includes 632 shares of common stock which are still subject to restriction within 60 days of February 15, 2016, and 72,085 shares of our common stock held by Penashe Holdings Propriety Limited. Dr. Fox is an executive director of Penashe Holdings Propriety Limited and may be deemed to have beneficial ownership of these securities, to the extent of any indirect pecuniary interest in his distributive shares therein.
|
(14)
|
The amount reported includes 56,056 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016, and 632 shares of common stock which are still subject to restriction within 60 days of February 15, 2016.
|
(15)
|
The amount reported includes 5,559 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016, and 4,500 shares held by the Lisa M. Giles Living Trust. Ms. Giles is a trustee of Lisa M. Giles Living Trust and may be deemed to have beneficial ownership of these securities, to the extent of any indirect pecuniary interest in her distributive shares therein.
|
(16)
|
The amount reported includes 5,559 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016.
|
(17)
|
The amount reported includes 56,476 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016, and 790 shares of common stock which are still subject to restriction within 60 days of February 15, 2016.
|
(18)
|
The amount reported includes 418,576 shares of common stock held by the Massarany Family Trust and 461,681 options to purchase shares of our common stock held by the Massarany Family Trust, which are currently exercisable or exercisable within 60 days of February 15, 2016. Mr. Massarany is a trustee of the Massarany Family Trust and may be deemed to have beneficial ownership of these securities. The amount reported also includes 6,875 shares of our common stock held by Mr. Massarany which are still subject to restriction within 60 days of February 15, 2016.
|
(19)
|
The amount reported includes 50,619 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016, and 33,441 shares held by the Mendel Family Trust. Mr. Mendel is a trustee of the Mendel Family Trust and may be deemed to have beneficial ownership of these securities.
|
(20)
|
The amount reported includes 65,147 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016.
|
(21)
|
The amount reported includes 134,903 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016, and 3,437 shares of common stock which are still subject to restriction within 60 days of February 15, 2016.
|
(22)
|
The amount reported includes 71,803 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016.
|
(23)
|
The amount reported also includes 61,651 shares of our common stock held by the HI Charitable Remainder Uni Trust, 82,934 shares of our common stock held by The Jon Faiz Kayyem and Paige N. Gates Family Trust, dated April 1, 2000, and 569,308 shares of our common stock held by IFIN LP. Dr. Kayyem is trustee of the HI Charitable Remainder Uni Trust, trustee of The Jon Faiz Kayyem and Paige N. Gates Family Trust, dated April 1, 2000, and the President of In-Motion LLC, the general partner of IFIN LP. Dr. Kayyem may be deemed to have beneficial ownership of the shares held by these entities. The amount reported also includes 240,263 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016 held by Jon Faiz Kayyem, Ph.D., and 3,125 shares of common stock held by Dr. Kayyem which are still subject to restriction within 60 days of February 15, 2016. The amount reported includes 235,550 shares of our common stock held by Jennifer Williams, including 143,435 options to purchase shares of our common stock currently exercisable or exercisable within 60 days of February 15, 2016, and 3,750 shares of common stock which are still subject to restriction within 60 days of February 15, 2016.
|
Name
|
|
Age
|
|
Position
|
Hany Massarany
|
|
54
|
|
President, Chief Executive Officer and Director
|
Scott Mendel
|
|
49
|
|
Chief Financial Officer
|
Jon Faiz Kayyem, Ph.D.
|
|
52
|
|
Founder and Senior Vice President, Research and Development
|
Ingo Chakravarty
|
|
48
|
|
Senior Vice President, International
|
Michael Gleeson
|
|
41
|
|
Senior Vice President, North American Commercial Operations
|
Eric Stier
|
|
40
|
|
Senior Vice President, General Counsel and Secretary
|
Jennifer Williams
|
|
42
|
|
Senior Vice President, Human Resources
|
•
|
any employment arrangement with, or compensation or benefit for, an executive officer of the Company if (i) the compensation is required to be reported in the Company’s proxy statement or would have been required to be reported if the executive officer had been a “named executive officer,” and (ii) the Company’s Compensation Committee approved such arrangement, compensation or benefit, or such arrangement, compensation or benefit is available to employees generally;
|
•
|
any compensation paid to a director if the compensation is required to be reported in the Company’s proxy statement; and
|
•
|
any transaction where the Related Person’s interest arises solely from the ownership of the Company’s common stock and all holders of the Company’s common stock received the same benefit on a pro rata basis (e.g., dividends).
|
Plan Category
|
|
Number of
securities
to be
issued
upon
exercise of
outstanding options, warrants and rights
|
|
Weighted-average
exercise
price of
outstanding
options, warrants and rights
|
|
Number of
Securities
Remaining
Available for
Future
Issuance
Under
Equity
Compensation
Plans
(excluding
securities
reflected
in column (a))
|
Equity compensation plans approved by stockholders
|
|
4,238,347
(1)
|
|
$9.74
|
|
551,194
(2)
|
Equity compensation plans not approved by stockholders
|
|
—
|
|
—
|
|
—
|
Total:
|
|
4,238,347
|
|
$9.74
|
|
551,194
|
(1)
|
Consists of stock option awards (
3,004,011
), restricted stock units (
934,977
), market stock units (
277,759
) and performance stock units (
21,600
) granted under the Company's 2010 Equity Incentive Plan, as amended (the "
2010 Plan
").
|
(2)
|
As of December 31, 2015, an aggregate of
145,297
shares of common stock were available for issuance under the 2010 Plan and an aggregate of
405,897
shares were available for issuance under the Company's 2013 Employee Stock Purchase Plan (the "
ESPP
"). The 2010 Plan contains a provision for an automatic increase in the number of shares available for grant each January until and including January 1, 2020, subject to certain limitations, by a number of shares equal to the lesser of 3% of the number of shares of our common stock issued and outstanding on the immediately preceding December 31 or a number of shares set by our Board. Effective
January 1, 2016
, an additional
1,276,545
shares became available for grant under the 2010 Plan in accordance with its terms.
|
•
|
Hany Massarany, our President and Chief Executive Officer (our "CEO");
|
•
|
Scott Mendel, our Chief Financial Officer;
|
•
|
Ingo Chakravarty, our Senior Vice President, International;
|
•
|
Michael Gleeson, our Senior Vice President, North American Commercial Operations;
|
•
|
Jeff Hawkins, our former Senior Vice President, Global Marketing and Program Management; and
|
•
|
Eric Stier, our Senior Vice President, General Counsel and Secretary.
|
•
|
We delivered strong financial results. Specifically:
|
◦
|
our annual revenue grew to $39.4 million, an increase of 29% over 2014;
|
◦
|
we drove a 4% increase in gross margin over 2014, from 57% in 2014 to 61% in 2015; and
|
◦
|
we increased the number of XT-8 analyzers placed with our customers by 93, to a total of 633.
|
•
|
We scaled our manufacturing capability to support ePlex’s European launch and U.S. clinical trials. For example:
|
◦
|
we established a specialized technical operations group to drive all aspects of manufacturing process transfer, optimization and capacity buildup;
|
◦
|
we transferred the manufacture of our ePlex RP panel consumables to our manufacturing team, which now has the capability to produce the required amount of ePlex consumables for European launch and important regulatory and clinical studies; and
|
◦
|
we leased an additional 34,000 square feet of manufacturing space and commenced construction of critical infrastructure to support our future high-volume ePlex manufacturing needs.
|
•
|
We strengthened our likelihood of obtaining prompt U.S. 510(k) clearance for our ePlex system. In particular:
|
◦
|
we filed pre-submissions with the FDA for our ePlex instrument and RP panel and reached agreement with the FDA regarding the scope of the associated U.S. clinical trial; and
|
◦
|
we collected 100% of the banked clinical samples and commenced comparator method testing necessary to satisfy the clinical study design for our ePlex instrument and RP panel.
|
•
|
We enhanced our commercial execution capabilities to deliver a successful ePlex launch in Europe and the United States. For example:
|
◦
|
we built a sizeable and experienced European sales and service organization through direct hires and experienced distribution partners capable of covering all major European markets;
|
◦
|
we partnered with an industry-leading third party logistics provider with demonstrated capability to satisfy our European product delivery requirements; and
|
◦
|
we developed a detailed U.S. sales force expansion plan to dramatically expand our U.S. sales force by the end of 2016, which we recently began to execute to support ePlex’s U.S. launch.
|
•
|
We have carefully conserved our cash resources. Specifically:
|
◦
|
we obtained access to a $40 million debt facility with Healthcare Financial Solutions, LLC (formerly General Electric Capital Corporation) and certain other lenders, which contains remaining borrowing capacity of $30 million;
|
◦
|
we maintained strict expense controls; and
|
◦
|
we ended 2015 with $45.5 million in cash and cash equivalents.
|
•
|
Base Salary
. We maintained the 2015 base salaries of our CEO and all of our other named executive officers at their 2014 levels, based on an evaluation of competitive market data and in an effort to conserve our cash resources.
|
•
|
Annual Bonus Awards.
Our annual bonus plan was designed to provide short-term incentive opportunities based on our actual performance as measured
by multiple performance objectives linked to our annual operating plan. Consistent with past years, our Compensation Committee established a target bonus for our CEO of 100% of his annual base salary, and 50% of base salary for each of our other named executive officers. Based on actual performance, our named executive officers could have received between 0% and 150% of their respective target bonus. In recognition of ePlex’s critical importance to our long-term success, the Compensation Committee directly linked 80% of the aggregate potential payout (i.e., 120% of the total 150% of target bonus which could have been earned) under our 2015 bonus plan to various ePlex commercialization milestones. In 2015, we recorded $39.4 million in total revenues. We did not launch our ePlex system or place any ePlex instruments with customers in
|
Named Executive Officer
|
|
Grant Date Fair Value ($)
|
|
Value Realized ($)
|
Hany Massarany
|
|
868,264
|
|
11,376
|
Scott Mendel
|
|
176,815
|
|
2,312
|
Ingo Chakravarty
|
|
301,408
|
|
3,942
|
Michael Gleeson
|
|
301,408
|
|
3,942
|
Jeff Hawkins
|
|
251,173
|
|
—
|
Eric Stier
|
|
276,290
|
|
3,616
|
•
|
A majority of target direct compensation is variable in nature and “at risk.”
Our executive compensation program provides a majority of the target total direct compensation opportunities for our named executive officers in the form of an annual cash bonus opportunity and equity awards, which derive their value from our stock price performance. As illustrated below, approximately 87% of our CEO’s
target
total direct compensation for 2015 was in the form of variable pay, and, therefore, "at risk." In addition, more than 82% of the compensation reported in the 2015 Summary Compensation Table for our CEO consisted of equity awards.
|
•
|
Annual bonuses are performance-based
. Each year, our annual bonus plan uses multiple performance measures to create incentives for our named executive officers to achieve our specific annual financial and operational objectives for the year. As noted above, our Compensation Committee directly linked the vast majority of potential bonus payouts under our 2015 bonus plan to satisfying various ePlex commercialization milestones. As a result, despite delivering strong 2015 financial performance in the face of a weak flu season, our executive officers earned only 21.75% of their target bonus under our 2015 bonus plan as a result of the delays we experienced in launching our ePlex system.
|
•
|
Executive equity compensation is directly linked to stock price performance
. By design, the MSUs directly link the number of shares which may be issued to executive officers (and therefore the overall value delivered) to the Company’s stock price performance as compared to the Index over a three-year period. As noted above, our Compensation Committee initially granted MSUs to our executive officers in February 2015, in an effort to further align executive compensation with stockholder value creation. Based on actual performance, recipients may be issued between 0% and 200% of the target number of MSUs. As a result of our stock price performance during 2015, our named executive officers were only issued approximately 9% of the shares of our common stock which could have been earned under the MSUs in respect of the one-year performance period. In addition, our CEO forfeited all 10,800 performance stock units originally granted to him in 2014 (which had a grant date fair value of $132,840 as reported in the 2014 Summary Compensation Table below) that he could have earned in respect of the 2015 performance period as a result of our inability to launch our ePlex system during 2015.
|
•
|
Independent Compensation Committee
. Our Compensation Committee is comprised solely of independent directors who have established effective means for communicating with our stockholders regarding their executive compensation ideas and concerns.
|
•
|
Independent Compensation Committee Advisor
. The Compensation Committee engaged its own compensation consultant to assist with its 2015 compensation
review. This consultant performed no consulting or other services for the Company during 2015.
|
•
|
Annual Executive Compensation Review
. Our Compensation Committee conducts an annual review and approval of our compensation strategy, including a review of our compensation peer group used for comparative purposes.
|
•
|
Annual Compensation-Related Risk Review.
Our Compensation Committee conducts an annual assessment of our compensation-related risk profile, including our compensation policies and practices, to ensure that our compensation-related risks are not reasonably likely to have a material adverse effect on the Company.
|
•
|
Executive Compensation Policies and Practices
. Our compensation philosophy and related corporate governance policies and practices are complemented by several specific compensation practices that are designed to align our executive compensation with long-term stockholder interests, including the following:
|
◦
|
Compensation At-Risk
. Our executive compensation program is designed so that a significant portion of compensation is “at risk” based on corporate performance, as well as equity-based to align the interests of our executive officers and stockholders.
|
◦
|
No Retirement Plans
. We do not currently offer, nor do we have plans to provide, pension arrangements, retirement
plans, or nonqualified deferred compensation plans or arrangements to our executive officers, other than our broad-based 401(k) defined contribution plan, as described in more detail below.
|
◦
|
No Special Health or Welfare Benefits
. Our executive officers participate in broad-based company-sponsored health and welfare benefits programs on the same basis as our other full-time, salaried employees.
|
◦
|
Limited Perquisites
. We do not consider perquisites or other personal benefits to be a significant component of our
executive compensation program. Accordingly, we provide only limited perquisites and other personal benefits, if any, to our executive officers, which, if provided, are generally
de minimis
in value.
|
◦
|
No Tax Reimbursements
. We do not provide any tax reimbursement payments (including “gross-ups”) on any perquisites
or other personal benefits or on any severance or change-in-control payments or benefits.
|
◦
|
Stock Ownership Policy
. We have adopted a stock ownership policy for our executive officers and non-employee members of our Board that requires them to maintain ownership of our common stock with a value equal to two or three times their annual base salary or director retainer, as applicable, depending on position.
|
◦
|
Hedging Prohibited
. We prohibit our directors and executive officers from engaging in short-term or speculative transactions involving the Company's securities, such as publicly traded options, short sales, puts and calls, and hedging transactions. This prohibition also applies to holding our securities in a margin account and “short sales against the box.”
|
◦
|
Stock Option Repricing Prohibited
. Our equity compensation plan prohibits the repricing of stock options and other equity awards without stockholder approval.
|
•
|
attract and retain highly-talented, experienced executives in our industry;
|
•
|
motivate and reward executives whose knowledge, skills and performance contribute to our success, including our key financial, operational and strategic goals;
|
•
|
align compensation with our business and financial objectives and the short-term and long-term interests of our stockholders; and
|
•
|
offer total compensation that is competitive and fair.
|
•
|
rewards individuals’ current contributions to the Company; and
|
•
|
compensates individuals for their expected day-to-day performance.
|
•
|
aligns executive compensation with annual corporate performance objectives;
|
•
|
enables us to attract, retain and reward individuals who contribute to our success; and
|
•
|
motivates individuals to enhance the value of our Company.
|
•
|
aligns individuals’ incentives with the long-term interests of our stockholders;
|
•
|
rewards individuals for potential long-term contributions; and
|
•
|
provides the potential for increased executive retention.
|
Performance Measure
|
|
Performance Level
(Corresponding % of Target Bonus Achieved)
|
|||
Annual Revenue
|
|
>$44 million
(30%)
|
$42 million
(25%)
|
$38 million
(20%)
|
<$25 million
(0%)
|
|
|
|
|
|
|
ePlex Customer Placements
|
|
High
(30%)
|
Medium/High
(20%)
|
Medium/Low
(15%)
|
Low
(0%)
|
|
|
|
|
|
|
ePlex Instrument + 2 Panels
- EU Launch
- Initiate Clinical Studies
- FDA 510(k) Submission
|
|
|
Date 1
20%
15%
|
Date 2
10%
10%
20%
|
Date 3
5%
5%
15%
|
|
|
|
|
|
|
CE/EU Launch of Additional Panels
|
|
4 Panels
(35%)
|
3 Panels
(20%)
|
2 Panels
(15%)
|
1 Panel
(10%)
|
Named Executive Officer
|
Total MSUs Awarded (#)
|
Target One-Year Shares (#)
|
Actual Shares Issued (#)
|
Hany Massarany
|
48,050
|
16,017
|
1,466
|
Scott Mendel
|
9,785
|
3,262
|
298
|
Ingo Chakravarty
|
16,680
|
5,560
|
508
|
Michael Gleeson
|
16,680
|
5,560
|
508
|
Jeff Hawkins
|
13,900
|
4,633
|
—
|
Eric Stier
|
15,290
|
5,097
|
466
|
•
|
Health Insurance
. We provide each of our executive officers and their spouses, qualifying domestic partners and children the same health, dental, and vision insurance coverage that we make available to our other eligible employees.
|
•
|
Life and Disability Insurance
. We provide each of our executive officers with the same disability and life insurance as we make available to our other eligible employees.
|
•
|
Retirement Benefits
. Our executive officers and other eligible employees are eligible to participate in our 401(k) defined contribution plan. We do not currently make matching contributions to participants in the 401(k) plan, however, we have previously made matching contributions and we may choose to do so again in the future. We do not provide pension arrangements or post-retirement health coverage for our executive officers or employees.
|
•
|
Employee Stock Purchase Plan
. In May 2013, our stockholders approved the ESPP, which allows all participants to acquire our common stock at a discount price. The ESPP has a six-month look-back and allows participants to buy our stock at a 15% discount to the lower of the market price on the first or last day of the applicable six-month offering period with up to 10% of the participant’s base salary or a maximum of $25,000 annually.
|
•
|
Perquisites and other Personal Benefits
. We have limited the perquisites and other personal benefits that we make available to our executive officers. Our executive officers are entitled to relocation expenses on their initial hire and other benefits with
de minimis
value that are not otherwise available to all of our employees. In the future, we may
|
Name and Principal Position
|
Year
|
|
Salary
($)
|
|
Stock
Awards
($)(1)(2)
|
|
Option
Awards
($)(1)
|
|
Non-Equity
Incentive Plan
Compensation
($)
|
|
All Other
Compensation
($)(3)
|
|
Total
|
||||||
Hany Massarany
|
2015
|
|
467,308
|
|
|
1,501,082
|
|
|
1,124,477
|
|
|
97,875
|
|
|
430
|
|
|
3,191,172
|
|
President, Chief Executive
Officer and Director
|
2014
|
|
450,000
|
|
|
305,697
|
|
|
229,097
|
|
|
252,000
|
|
|
414
|
|
|
1,237,208
|
|
2013
|
|
450,000
|
|
|
882,000
|
|
|
545,160
|
|
|
—
|
|
|
430
|
|
|
1,877,590
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Scott Mendel
(4)
|
2015
|
|
332,308
|
|
|
305,697
|
|
|
229,097
|
|
|
34,800
|
|
|
280
|
|
|
902,182
|
|
Chief Financial Officer
|
2014
|
|
189,539
|
|
|
533,011
|
|
|
325,220
|
|
|
56,951
|
|
|
166
|
|
|
1,104,887
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Ingo Chakravarty
|
2015
|
|
259,616
|
|
|
521,083
|
|
|
390,506
|
|
|
27,188
|
|
|
280
|
|
|
1,198,673
|
|
Senior Vice President,
International
|
2014
|
|
245,385
|
|
|
131,351
|
|
|
311,434
|
|
|
70,000
|
|
|
270
|
|
|
758,440
|
|
2013
|
|
154,808
|
|
|
429,689
|
|
|
382,800
|
|
|
—
|
|
|
187
|
|
|
967,484
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Michael Gleeson
|
2015
|
|
259,616
|
|
|
521,083
|
|
|
390,506
|
|
|
27,188
|
|
|
187
|
|
|
1,198,580
|
|
Senior Vice President, North
American Commercial Operations
|
2014
|
|
245,385
|
|
|
521,083
|
|
|
390,506
|
|
|
70,000
|
|
|
180
|
|
|
1,227,154
|
|
2013
|
|
226,154
|
|
|
325,828
|
|
|
233,640
|
|
|
—
|
|
|
181
|
|
|
785,803
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Jeffrey Hawkins
|
2015
|
|
216,346
|
|
|
533,011
|
|
|
325,220
|
|
|
—
|
|
|
35,905
|
|
|
1,110,482
|
|
Former Senior Vice President,
Global Marketing and Program
Management
|
2014
|
|
245,385
|
|
|
217,451
|
|
|
560,581
|
|
|
70,000
|
|
|
162
|
|
|
1,093,579
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Eric Stier
|
2015
|
|
244,039
|
|
|
477,660
|
|
|
357,964
|
|
|
25,556
|
|
|
280
|
|
|
1,105,499
|
|
Senior Vice President, General
Counsel and Secretary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Amounts reported reflect the grant date valuation of the awards determined in accordance with ASC Topic 718. For more information, see Note 5 in the Notes to Consolidated Financial Statements contained in our Annual Report on Form 10-K filed with the SEC on February 23, 2016.
|
(2)
|
The amounts reported in 2015 reflect the grant date fair value of annual restricted stock units and MSUs granted in February 2015. The amounts reported for 2014 for all named executive officers reflect the grant date fair value of (a) annual restricted stock units granted in March 2014, and (b) restricted stock units granted in March 2015 in respect of the 2014 performance period. The amounts reported for 2013 for all named executive officers reflect the grant date fair value of (a) annual restricted stock units granted in March 2013, and (b) restricted stock units granted in March 2014 in respect of the 2013 performance period.
|
(3)
|
Except with respect to Mr. Hawkins, all amounts reported consist of life insurance benefits. With respect to Mr. Hawkins, the amount reported consists of vacation accural payout ($35,764) in connection with his resignation of employment in October 2015 and life insurance benefits ($141).
|
|
|
Estimated Future Payouts
Under
Non-Equity Incentive Plan
Awards(1)
|
Estimated Future Payouts
Under
Equity Incentive Plan
Awards(2)
|
All Other
Stock
Awards:
Number
of Shares
of Stock
or Units
(#)(3)
|
All Other
Option
Awards:
Number
of Securities
Underlying
Options
(#)(4)
|
Exercise
or Base
Price of
Option
Awards
($/Sh)
|
Grant
Date Fair
Value of
Stock
and
Option
Awards
($)(5)
|
||||||||||||||
Name
|
Grant
Date
|
Threshold
($)
|
Target
($)
|
Maximum
($)
|
Threshold
(#)
|
Target
(#)
|
Maximum
(#)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Hany Massarany
|
|
—
|
|
450,000
|
|
675,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
2/19/15
|
|
|
|
—
|
|
48,050
|
|
96,100
|
|
|
|
|
|
|
868,264
|
|
||||
|
2/19/15
|
|
|
|
|
|
|
|
|
|
48,050
|
|
|
|
632,819
|
|
|||||
|
2/19/15
|
|
|
|
|
|
|
|
|
|
|
|
|
174,500
|
|
13.17
|
|
1,124,477
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Scott Mendel
|
|
—
|
|
160,000
|
|
240,000
|
|
|
|
|
|
|
|
|
|||||||
|
2/19/15
|
|
|
|
—
|
|
9,785
|
|
19,570
|
|
|
|
|
176,815
|
|
||||||
|
2/19/15
|
|
|
|
|
|
|
9,786
|
|
|
|
128,882
|
|
||||||||
|
2/19/15
|
|
|
|
|
|
|
|
35,552
|
|
13.17
|
|
229,097
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Ingo Chakravarty
|
|
—
|
|
125,000
|
|
187,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
—
|
|
16,680
|
|
33,360
|
|
|
|
|
301,408
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
|
16,680
|
|
|
|
|
|
219,676
|
|
|||||
|
2/19/15
|
|
|
|
|
|
|
|
|
|
|
|
|
60,600
|
|
13.17
|
|
390,506
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Michael Gleeson
|
|
—
|
|
125,000
|
|
187,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
—
|
|
16,680
|
|
33,360
|
|
|
|
|
301,408
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
|
16,680
|
|
|
|
|
|
219,676
|
|
|||||
|
2/19/15
|
|
|
|
|
|
|
|
|
|
|
|
|
60,600
|
|
13.17
|
|
390,506
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Jeffrey Hawkins
|
|
—
|
|
125,000
|
|
187,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
—
|
|
13,900
|
|
27,800
|
|
|
|
|
251,173
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
|
21,400
|
|
|
|
|
|
281,838
|
|
|||||
|
2/19/15
|
|
|
|
|
|
|
|
|
|
|
|
|
50,500
|
|
13.17
|
|
325,220
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Eric Stier
|
|
—
|
|
117,500
|
|
176,250
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
—
|
|
15,290
|
|
30,580
|
|
|
|
|
276,290
|
|
|||
|
2/19/15
|
|
|
|
|
|
|
|
15,290
|
|
|
|
|
|
201,369
|
|
|||||
|
2/19/15
|
|
|
|
|
|
|
|
|
|
|
|
|
55,550
|
|
13.17
|
|
357,964
|
|
(1)
|
Amounts reported represent the threshold, target and maximum cash bonus amounts that could have been earned under our 2015 annual bonus plan.
|
(3)
|
Amounts reported reflect annual grants of restricted stock units made under the 2010 Plan, which vest 25% on February 1, 2016 and in equal quarterly installments thereafter over the following three years.
|
(4)
|
Amounts reported reflect annual grants of stock options under the 2010 Plan to all named executive officers. All stock options vest and become exercisable on a four-year vesting schedule, with 25% of the shares subject to the option vesting on February 1, 2016 and the remaining shares subject to the option vesting in equal monthly installments over the following three years.
|
(5)
|
Amounts reported represent the grant date valuation of the awards determined in accordance with ASC Topic 718. For more information, see Note 5 in the Notes to Consolidated Financial Statements contained in our Annual Report on Form 10-K filed with the SEC on February 23, 2016.
|
|
|
|
|
Option Awards
|
|
Stock Awards
|
||||||||||||||||
Name
|
|
Grant
Date
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
|
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
|
Option
Exercise
Price
($)
|
|
Option
Expiration
Date
|
|
Number of
Shares or
Units that
have not
Vested
|
|
Market
Value of
Shares or
Units that
have not
Vested
(1)
|
||||||||
Hany Massarany
|
|
4/05/11
|
|
275,000
|
|
|
—
|
|
|
$
|
3.95
|
|
|
4/05/21
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
2/29/12
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,875
(4)
|
|
|
$
|
53,350
|
|
|
|
|
3/06/13
|
|
52,936
|
|
|
24,064
|
|
|
$
|
10.89
|
|
|
3/06/23
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
3/06/13
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,625
(4)
|
|
|
$
|
121,250
|
|
|
|
|
3/06/14
|
|
70,312
|
|
|
90,402
|
|
|
$
|
12.30
|
|
|
3/06/24
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
3/06/14
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,600
(5)
|
|
|
$
|
167,616
|
|
|
|
|
2/19/15
|
|
—
|
|
|
174,500
|
|
|
$
|
13.17
|
|
|
2/19/25
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,584
(6)
|
|
|
$
|
361,492
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
48,050
(4)
|
|
|
$
|
372,868
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,007
(7)
|
|
|
$
|
69,894
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Scott Mendel
|
|
5/13/14
|
|
33,251
|
|
|
50,751
|
|
|
$
|
9.43
|
|
|
5/13/24
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
5/13/14
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,603
(4)
|
|
|
$
|
260,759
|
|
|
|
|
2/19/15
|
|
—
|
|
|
35,552
|
|
|
$
|
13.17
|
|
|
2/19/25
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,487
(6)
|
|
|
$
|
73,619
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,786
(4)
|
|
|
$
|
75,939
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,036
(7)
|
|
|
$
|
15,799
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Ingo Chakravarty
|
|
5/06/13
|
|
25,832
|
|
|
14,168
|
|
|
$
|
14.73
|
|
|
5/06/23
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
5/06/13
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,375
(4)
|
|
|
$
|
72,750
|
|
|
|
|
3/06/14
|
|
17,500
|
|
|
22,500
|
|
|
$
|
12.30
|
|
|
3/06/24
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
3/06/14
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,500
(4)
|
|
|
$
|
34,920
|
|
|
|
|
2/19/15
|
|
—
|
|
|
60,600
|
|
|
$
|
13.17
|
|
|
2/19/25
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,172
(6)
|
|
|
$
|
125,495
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,680
(4)
|
|
|
$
|
129,437
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,502
(7)
|
|
|
$
|
19,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Michael Gleeson
|
|
2/23/09
|
|
56,816
|
|
|
—
|
|
|
$
|
6.49
|
|
|
2/23/19
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
2/29/12
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,437
(4)
|
|
|
$
|
26,671
|
|
|
|
|
3/06/13
|
|
22,687
|
|
|
10,313
|
|
|
$
|
10.89
|
|
|
3/06/23
(2)
|
|
|
—
|
|
|
$
|
—
|
|
|
|
3/06/13
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,875
(4)
|
|
|
53,350
|
|
||
|
|
3/06/14
|
|
31,500
|
|
|
40,500
|
|
|
$
|
12.30
|
|
|
3/06/24
(2)
|
|
|
—
|
|
|
$
|
—
|
|
|
|
3/06/14
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,437
(4)
|
|
|
$
|
65,471
|
|
|
|
|
2/19/15
|
|
—
|
|
|
60,600
|
|
|
$
|
13.17
|
|
|
2/19/25
(2)
|
|
|
—
|
|
|
—
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,172
(6)
|
|
|
$
|
125,495
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,680
(4)
|
|
|
$
|
129,437
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,502
(7)
|
|
|
$
|
19,416
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Jeffrey Hawkins
|
|
5/28/10
|
|
28,500
|
|
|
—
|
|
|
$
|
6.00
|
|
|
1/23/16
(3)
|
|
|
—
|
|
|
—
|
|
|
|
|
6/03/10
|
|
42,612
|
|
|
—
|
|
|
$
|
6.49
|
|
|
1/23/16
(3)
|
|
|
—
|
|
|
—
|
|
|
|
|
3/06/13
|
|
17,437
|
|
|
—
|
|
|
$
|
10.89
|
|
|
1/23/16
(3)
|
|
|
—
|
|
|
—
|
|
|
|
|
3/06/14
|
|
28,500
|
|
|
—
|
|
|
$
|
12.30
|
|
|
1/23/16
(3)
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Eric Stier
|
|
11/5/12
|
|
23,125
|
|
|
6,875
|
|
|
$
|
8.50
|
|
|
11/5/22
(2)
|
|
|
—
|
|
|
—
|
|
|
|
3/06/13
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,958
(4)
|
|
|
$
|
22,954
|
|
|
|
|
3/06/14
|
|
27,125
|
|
|
34,875
|
|
|
$
|
12.30
|
|
|
3/06/24
(2)
|
|
|
—
|
|
|
$
|
—
|
|
|
|
3/06/14
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,312
(4)
|
|
|
56,741
|
|
||
|
|
2/19/15
|
|
—
|
|
|
55,550
|
|
|
$
|
13.17
|
|
|
2/19/25
(2)
|
|
|
—
|
|
|
$
|
—
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,824
(6)
|
|
|
$
|
115,034
|
|
|
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,290
(4)
|
|
|
118,650
|
|
||
|
|
2/19/15
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,352
(7)
|
|
|
$
|
18,252
|
|
(1)
|
The market value was determined by multiplying the number of stock awards by the closing price of our common stock on NASDAQ on December 31, 2015 of $7.76.
|
(2)
|
Represents stock options that vest 25% on the first anniversary of the grant date, with the remaining shares vesting in equal monthly installments thereafter over the following three years. All option grants have a term of ten years.
|
(3)
|
Represents stock options that ceased vesting in October 2015 in connection with Mr. Hawkins' resignation of employment. Vested options remain exercisable for three months following the date of resignation.
|
(4)
|
Represents restricted stock awards or units that vest 25% on the first anniversary of the grant date, with the remaining shares vesting in 12 equal quarterly installments thereafter, contingent upon continued service to the Company.
|
(5)
|
Represents performance stock units that vest 25% in each of the following four years based on the achievement of particular product and commercialization milestones.
|
(6)
|
Represents MSUs which vest one-third each on December 31, 2015, December 31, 2016 and December 31, 2017. Based on actual performance, each individual may earn between 0% and 200% of the target number of MSUs granted. Amounts reported represent the target number of MSUs outstanding on December 31, 2015.
|
Name
|
|
Option Awards
|
|
Stock Awards
|
|||||||||
|
Number of Shares
Acquired on
Exercise (#)
|
|
Value Realized on
Exercise ($)
|
|
Number of Shares
Acquired on
Vesting (#)
|
|
Value Realized
on Vesting
($)(1)
|
||||||
Hany Massarany
|
|
—
|
|
|
—
|
|
|
122,457
|
|
|
$
|
1,438,470
|
|
Scott Mendel
|
|
—
|
|
|
—
|
|
|
15,253
|
|
|
$
|
167,161
|
|
Ingo Chakravarty
|
|
—
|
|
|
—
|
|
|
20,459
|
|
|
$
|
182,653
|
|
Michael Gleeson
|
|
—
|
|
|
—
|
|
|
41,554
|
|
|
$
|
463,824
|
|
Jeffrey Hawkins
|
|
—
|
|
|
—
|
|
|
15,076
|
|
|
$
|
175,985
|
|
Eric Stier
|
|
—
|
|
|
—
|
|
|
24,912
|
|
|
$
|
292,711
|
|
(1)
|
The value realized on vesting is determined by multiplying (x) the number of shares that vested during 2015, times (y) the closing price of our common stock on NASDAQ on the applicable vesting date.
|
Name
|
|
Value of Acceleration of Unvested Equity Awards Upon Change in Control
|
|
Value if
Involuntarily
Terminated Without
Cause
|
|
Value if
Voluntarily
Terminated by
Executive for Good
Reason
|
|
Value if
Terminated
Due to
Death or
Disability
|
|
Value if
Involuntarily
Terminated
following a
Change in
Control
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|||||
Hany Massarany
|
|
$818,236
(1)
|
|
|
$1,520,236
(2)
|
|
|
$1,520,236
(2)
|
|
|
$1,268,236
(3)
|
|
|
$2,222,236
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Scott Mendel
|
|
$359,270
(1)
|
|
|
$160,000
(5)
|
|
|
—
|
|
|
—
|
|
|
$519,270
(6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Ingo Chakravarty
|
|
$268,069
(1)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$268,069
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Michael Gleeson
|
|
$240,420
(1)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$240,420
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Jeff Hawkins
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Eric Stier
|
|
$227,180
(1)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$227,180
(1)
|
|
(1)
|
Amounts reported reflect the value attributable to the immediate acceleration of unvested equity awards upon a change of control event based on the closing price of our common stock on NASDAQ on December 31, 2015 of $7.76 per share.
|
(2)
|
The amount reported reflects (a) a severance payment equal to Mr. Massarany’s base salary at the time of termination ($450,000), plus the last annual bonus paid to Mr. Massarany ($252,000), and (b) the value attributable to the immediate acceleration of unvested equity awards upon such termination event based on the closing price of our common stock on NASDAQ on December 31, 2015 of $7.76 per share ($
818,235
), in each in accordance with the terms of Mr. Massarany’s employment agreement.
|
(3)
|
The amount reported reflects a prorated portion of Mr. Massarany’s annual bonus payable in accordance with our 2015 annual bonus plan (or $450,000, assuming a qualifying termination event on December 31, 2015), and the value attributable to the immediate acceleration of unvested equity awards upon such termination event based on the closing price of our common stock on NASDAQ on December 31, 2015 of $7.76 per share (
$818,235
), in each in accordance with the terms of Mr. Massarany’s employment agreement.
|
(4)
|
The amount reported reflects: (a) a severance payment equal to ($1,404,000), representing the product of two multiplied by (i) Mr. Massarany’s base salary at the time of termination ($450,000), plus (ii) the last annual bonus paid to Mr. Massarany ($252,000); and (b) the value attributable to the immediate acceleration of unvested equity awards upon such termination event based on the closing price of our common stock on NASDAQ on December 31, 2015 of $7.76 per share (
$818,235
), in each in accordance with the terms of Mr. Massarany’s employment agreement.
|
(5)
|
Mr. Mendel would be entitled to six months’ base salary continuation if his employment is terminated without cause.
|
(6)
|
The amount reported reflects: (a) six months' salary continuation ($160,000); and (b) the value attributable to the immediate acceleration of unvested equity awards upon such termination event based on the closing price of our common stock on NASDAQ on December 31, 2015 of $7.76 per share (
$359,270
), in each in accordance with the terms of Mr. Mendel’s employment agreement.
|
•
|
any act or omission that constitutes a material breach by Mr. Massarany of any of his material obligations under the agreement or his Employee Innovations and Proprietary Rights Agreement with the Company, after a written demand for substantial performance is delivered to Mr. Massarany by the Board that specifically identifies the manner in which the Board believes that Mr. Massarany has materially breached his obligations under the agreement and Mr. Massarany’s failure to cure such alleged breach not later than 30 days following his receipt of such notice;
|
•
|
Mr. Massarany’s conviction of, or plea of nolo contendere to, any felony;
|
•
|
Mr. Massarany’s ongoing willful refusal to follow the proper and lawful directions of the Board after a written demand for substantial performance is delivered to him by the Board that specifically identifies the manner in
|
•
|
any acts or omissions constituting willful misconduct by Mr. Massarany (including any violation of federal securities laws) which is materially and demonstrably injurious to the financial condition or business reputation of the Company and its subsidiaries, taken as a whole.
|
•
|
a material breach of Mr. Massarany’s employment agreement by the Company (including, but not limited to, a removal of Mr. Massarany from the office of Chief Executive Officer for a reason other than cause or his disability);
|
•
|
Mr. Massarany’s failure to be elected or re-elected to the Board;
|
•
|
a material diminution in Mr. Massarany’s then authority, duties or responsibilities;
|
•
|
a reduction by the Company in Mr. Massarany’s base salary or target bonus amount; or
|
•
|
relocation of Mr. Massarany’s base office to an office that is more than 30 highway miles from Mr. Massarany’s base office prior to such relocation.
|
Position
|
|
2015 Annual Retainer
|
Board Membership
|
|
$75,000
|
Chairman of the Board
|
|
$40,000
|
Chair of Audit Committee
|
|
$15,000
|
Chair of the Compensation Committee
|
|
$10,000
|
Chair of the Corporate Governance and Nominating Committee
|
|
$6,000
|
Audit Committee Members other than Chair
|
|
$6,000
|
Compensation Committee Members other than Chair
|
|
$5,000
|
Corporate Governance and Nominating Committee Members other than Chair
|
|
$4,000
|
Name
|
|
Fees Earned or Paid
in Cash ($)(1)
|
|
Stock Awards ($)(2)
|
|
Totals ($)
|
|||
Daryl Faulkner
(3)
|
|
26,875
|
|
|
64,503
|
|
|
91,378
|
|
James Fox, Ph.D.
(4)
|
|
41,695
|
|
|
101,252
|
|
|
142,947
|
|
Lisa M. Giles
(5)
|
|
22,556
|
|
|
76,956
|
|
|
99,512
|
|
Michael S. Kagnoff
(6)
|
|
21,999
|
|
|
81,478
|
|
|
103,477
|
|
Kevin C. O’Boyle
(7)
|
|
29,688
|
|
|
71,249
|
|
|
100,937
|
|
Stephen Worland, Ph.D.
(8)
|
|
2,951
|
|
|
—
|
|
|
2,951
|
|
(1)
|
Pursuant to the Company’s director compensation policy in effect for 2015, non-employee directors received approximately 75% of their compensation in the form of restricted stock units.
|
(2)
|
In 2015, each non-employee director received the following number of restricted stock units as payment in respect of director fees: Mr. Faulkner (
6,884
); Dr. Fox (
10,806
); Ms. Giles (
8,213
); Mr. Kagnoff (
8,011
); and Mr. O’Boyle (
7,604
). Each of these restricted stock units vest 100% on the first anniversary of the grant date.
|
(3)
|
As of December 31, 2015, Mr. Faulkner held 56,056 options to purchase shares of our common stock, 1,264 shares of restricted stock, and 6,884 restricted stock units.
|
(4)
|
As of December 31, 2015, Dr. Fox held no options to purchase shares of our common stock, 1,264 shares of restricted stock, and 10,806 restricted stock units.
|
(5)
|
As of December 31, 2015, Ms. Giles held 19,062 options to purchase shares of our common stock and 6,483 restricted stock units.
|
(6)
|
As of December 31, 2015, Mr. Kagnoff held 19,062 options to purchase shares of our common stock and 6,323 restricted stock units.
|
(7)
|
As of December 31, 2015, Mr. O’Boyle held 56,476 options to purchase shares of our common stock, 1,580 shares of restricted stock, and 7,604 restricted stock units.
|
(8)
|
Dr. Worland resigned from the Board in February 2015.
|
•
|
reviewed and discussed the audited financial statements as of and for the fiscal year ended December 31, 2015 with the Company’s management and Ernst & Young LLP, the Company’s independent registered public accounting firm;
|
•
|
discussed with Ernst & Young LLP the matters required to be discussed by Auditing Standard No. 16, “Communication with Audit Committees,” as adopted by the Public Company Accounting Oversight Board in Rule 3200T;
|
•
|
received and reviewed the written disclosures and the letter from Ernst & Young LLP required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant’s communications with the Audit Committee concerning independence, discussed with the independent registered public accounting firm its independence, and concluded that the non-audit services performed by Ernst & Young LLP are compatible with maintaining its independence;
|
•
|
based on the foregoing reviews and discussions, recommended to the Board that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 filed with the SEC; and
|
•
|
instructed the independent registered public accounting firm that the Audit Committee expects to be advised if there are any subjects that require special attention.
|
|
Fiscal Year
2015
|
|
Fiscal Year
2014
|
||||
Audit fees
(1)
|
$
|
749,488
|
|
|
$
|
716,917
|
|
Tax fees
(2)
|
164,750
|
|
|
176,622
|
|
||
Total
|
$
|
914,238
|
|
|
$
|
893,539
|
|
(1)
|
Audit fees represent fees and out-of-pocket expenses whether or not yet invoiced for professional services provided in connection with the audit of the Company’s financial statements and Sarbanes-Oxley Act compliance, review of the Company’s quarterly financial statements, review of registration statements on Forms S-3 and S-8, and audit services provided in connection with other regulatory filings.
|
(2)
|
Tax fees consist of fees for professional services performed by Ernst & Young LLP with respect to tax compliance, tax advice and tax planning.
|
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