Filed by the
Registrant ☒
Filed by a Party other than the Registrant ☐
You are cordially invited to
attend the annual meeting of stockholders of Galectin Therapeutics Inc. The meeting will be held on Thursday, December 14 at 8:30 a.m., local time, at the offices of Dentons LLP, located at 303 Peachtree Street NE, Suite 5300, Atlanta, GA
30308, for the following purposes:
These items of business
are more fully described in the proxy statement accompanying this Notice.
In addition, the proxy statement contains other important
information about Galectin Therapeutics, including information about the role and responsibilities of our Board of Directors and its committees, information about executive compensation, and information about the beneficial ownership of Galectin
Therapeutics securities.
Your vote is very important. Whether or not you plan to attend the annual meeting in person, please complete and
return the enclosed proxy card.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The
Nominating and Corporate Governance Committee of our Board of Directors, or Board, has nominated four members currently serving on our Board, identified below under the subheading Company Nominees, to be
re-elected
at the 2017 Annual Meeting to serve until the 2018 annual meeting of stockholders and until their respective successors are elected and qualified. Each Company Nominee has agreed to serve on the Board, if
elected. The terms of current directors Peter G. Traber, M.D., John Mauldin, Steven Prelack and Arthur R. Greenberg will expire at the 2017 Annual Meeting and none of them have been nominated for
re-election
as a director at the 2017 Annual Meeting. Dr. Traber will continue as CEO, President and CMO of the Company under the terms of his employment agreement
The Nominating and Corporate Governance Committee is nominating only four directors to be elected to the Board of Directors because James
C. Czirr and Theodore Zucconi, Ph.D. are the two directors who are nominated and elected by the holder(s) of the Series B Preferred Stock voting as a separate class (the Series B Directors). In addition, the holder(s) of the Series
B Preferred Stock have the right, and have exercised the right, to nominate three additional directors to the Board, Joel Lewis, Richard Uihlein and Stephen Shulman (the Series B Nominees). Each of the Series B Nominees has consented to
be named in this proxy statement and to serve on the Board, if elected. As of October 16, 2017, 10X Fund L.P. is the owner of all of the issued and outstanding shares of the Series B Preferred Stock. James C. Czirr, one of the Series B
Directors, is managing member of 10X Capital Management LLC, the general partner of 10X Fund L.P. Richard Uihlein, one of the Series B Nominees, is a limited partner in 10X Fund L.P., and is a holder of more than 5% of our issued and outstanding
common stock and more than 5% of our outstanding Series C Preferred Stock. Joel Lewis is an employee of Uline Inc., a corporation for which Richard Uihlein is a controlling shareholder and serves as chief executive officer.
If all of the nominees are elected at the 2017 Annual Meeting, our Board of Directors will have nine members, including the Series B
Directors. Set forth below is information regarding the Company Nominees and the Series B Nominees, as of October 17, 2017, including their ages, positions with Galectin Therapeutics, recent employment and other directorships. Background
information with respect to the Series B Directors is also provided below.
OUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
THE ELECTION TO THE BOARD OF EACH NOMINEE.
The persons who have been nominated for election at the 2017 Annual Meeting to serve
on our Board of Directors are named in the table below. Proxies cannot be voted for a greater number of persons than the number of nominees named.
Company Nominees
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Name
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Age
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Position
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Director Since
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Gilbert F. Amelio, Ph.D (2)(3)
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73
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Director
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2009
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Kevin D. Freeman (1)
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56
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Director
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2011
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Marc Rubin, M.D (2)(3).
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61
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Director
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2011
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Gilbert S. Omenn, M.D., Ph.D. (2)
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75
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Director
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2014
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(1)
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Member of audit committee
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(2)
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Member of compensation committee
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(3)
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Member of nominating and governance committee
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Series B Nominees
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Name
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Age
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Position
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Director Since
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Joel Lewis.
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47
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Director
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n/a
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Richard E. Uihlein
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72
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Director
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n/a
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Stephen Shulman.
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74
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Director
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n/a
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We expect each of the Series B Nominees to serve on one or more committees of the Board, which will be
determined following the 2017 Annual Meeting.
Company Nominees
Gilbert F. Amelio, Ph.D
., a director since February 2009, began his career at Bell Labs in Murray Hill, New Jersey. Since
January 1, 2012, Dr. Amelio has provided consulting and advisory services through GFA, LLC, a California limited liability company. He was a Senior Partner of Sienna Ventures (a privately-held venture capital firm in Sausalito, California)
from April 2001 until the fund closed per plan on December 31, 2011. Dr. Amelio was Chairman and Chief Executive Officer of Jazz Technologies, Inc. (now a wholly owned subsidiary of Tower Semiconductor Ltd., an independent specialty wafer
foundry) from August 2005 until his retirement in September 2008 (when he was named Chairman Emeritus). Dr. Amelio was Chairman and Chief Executive Officer of Beneventure Capital, LLC (a full-service venture capital firm in San Francisco,
California) from 1999 to 2005 and was Principal of Aircraft Ventures, LLC (a consulting firm in Newport Beach, California) from April 1997 to December 2004. Dr. Amelio was elected a Director of AT&T in February 2001 and had previously
served as an Advisory Director of AT&T (then known as SBC Communications Inc.) from April 1997 to February 2001. He served as a Director of Pacific Telesis Group from 1995 until the company was acquired by AT&T in 1997. Prior to 1997, he
served as Chairman, President and CEO of National Semiconductor (1991-1996) and Apple Computer (1996-1997). We believe Dr. Amelios qualifications to sit on our Board of Directors
includes his executive leadership and management experience, as well as his extensive experience with global companies, his financial expertise and his years
of experience providing strategic advisory services to organizations.
Kevin D. Freeman
, a director since May 2011, holds the
Chartered Financial Analyst designation and is Chief Executive Officer of Cross Consulting and Services, LLC, an investment advisory and consulting firm founded in 2004. He is also author of a New York Times best-selling book about the stock market
and economy. Formerly he was Chairman of Separate Account Solutions, Inc. and held several offices at Franklin Templeton Investment Services from 1991 to 2000. He holds a B.S. in business administration from University of Tulsa, Tulsa, Oklahoma. We
believe Mr. Freemans qualifications to sit on our Board of Directors includes his extensive financial expertise and his years of experience providing financial advisory services.
Marc
Rubin, M.D,
a director since October 2011 and Chairman of the Board since January 2016, is Executive
Chairman of the Board of Directors of Titan Pharmaceuticals, Inc. (TTNP: OTC BB) and served as its President and Chief Executive Officer from October 2007 to January 2009. Until February 2007, Dr. Rubin served as Head of Global Research and
Development for Bayer Schering Pharma, as well as a member of the Executive Committee of Bayer Healthcare and the Board of Management of Bayer Schering Pharma. Prior to the merger of Bayer Pharmaceuticals and Schering AG in June 2006, Dr. Rubin
was a member of the Executive Board of Schering AG since joining the company in October 2003, as well as Chairman of Schering Berlin Inc. and President of Berlex Pharmaceuticals, a division of Schering AG. From 1990 until August 2003, Dr. Rubin
was employed by GlaxoSmithKline where he held positions of responsibility in global clinical and commercial development overseeing programs in the United States, Europe, Asia and Latin America. From 2001 through 2003 at GlaxoSmithKline, he was
Senior Vice President of Global Clinical Pharmacology & Discovery Medicine. Dr. Rubin holds an M.D. from Cornell University Medical College and is board certified in internal medicine with subspecialties in medical oncology and
infectious diseases. Dr. Rubin is a member of the Board of Directors of Curis Inc. (Nasdaq: CRIS) and formerly served on the Board of Directors of Medarex, Inc., now a
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subsidiary of Bristol-Myers Squibb Company. We believe Dr. Rubins qualifications to sit on our Board of Directors include his extensive executive leadership and management experience
in the pharmaceutical industry.
Gilbert S. Omenn, M.D., Ph.D.
, a director since September 2014, served on the board of directors
of Amgen Inc. for 27 years and of Rohm & Haas Company for 22 years. He currently serves on the boards of Esperion Therapeutics Inc., and Oncofusion. Dr. Omenn is Professor of Computational Medicine & Bioinformatics, Internal
Medicine, Human Genetics, and Public Health and Director of the university-wide Center for Computational Medicine and Bioinformatics at the University of Michigan where he leads major research programs in proteomics and integrative biomedical
informatics. Dr. Omenn served as executive vice president for medical affairs and as chief executive officer of the University of Michigan Health System from 1997 to 2002. Prior to this, he was the dean of the School of Public Health and
Community Medicine and professor of medicine at the University of Washington. He is the author of more than 563 research papers and scientific reviews and author/editor of 18 books. Dr. Omenn received his B.A. summa cum laude from Princeton
University, M.D. magna cum laude from Harvard Medical School, and Ph.D. in genetics from the University of Washington. We believe Dr. Omenns qualifications to sit on our Board of Directors include his extensive executive leadership and
management experience in the medical industry and his continuing cutting-edge research.
Series B Nominees
Richard E. Uihlein
, a new nominee to our Board,
co-founded
Uline, Inc. (a leading distributor of
shipping, packaging and industrial supplies) in 1980, and has served as its Chief Executive Officer and Chairman since its founding. Prior to founding Uline Inc., Mr. Uihlein was employed at General Bindings Corp., Northbrook, IL from 1967 to
1980. Mr. Uihlein graduated from Stanford University, Palo Alto, CA. with a BA degree in history in 1967. We believe Mr. Uihleins qualifications to sit on our Board includes his extensive executive leadership and management
experience.
Stephen Shulman
, a new nominee to our Board, is the Chief Executive Officer of Medical Devices Inc. (MDI), a position
he has held since 1982. MDI is responsible for numerous medical device startups such as defibrillator electrodes, Fiberoptic pressure sensors, occlusive dressings, surgical glue,
non-invasive
body temperature
control and end stage renal care. Prior to the formation of MDI, he was Director of Sales and Marketing/Asia Pacific for Medtronic from 1970 to 1981. Mr. Shulman received a B.S.C. in microbiology and physics from Wayne State University. We
believe that Mr. Shulman is best situated to sit on our Board because of his extensive executive leadership and management experience in the medical device industry.
Joel Lewis
, a new nominee to our Board, is the Managing Director of Shareholder Services at Uline, Inc. (a distributor of shipping,
packaging and industrial supplies), a position he has held since 2007. Prior to his employment with Uline Inc., Mr. Lewis served as a Tax and Accounting Manager for Century America LLC from 2001 to 2006 and a Tax Manager for Deloitte &
Touche from 1998 to 2001. Mr. Lewis received his undergraduate degree from the University of Illinois at Urbana-Champaign and his Masters in Science of Taxation from DePaul University. We believe that Mr. Lewis qualifications to sit
on our Board include his business and financial expertise and his service as a board observer on our Board during 2017.
Series B Directors
The persons below have been nominated and will be elected by the holder(s) of the Series B Preferred Stock voting as a separate class to serve
on our Board of Directors. These directors are not subject to election by the holders of our common stock at the 2017 Annual Meeting, and proxies cannot be voted for these directors.
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Name
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Age
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Director Since
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James C. Czirr
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62
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2009
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Theodore Zucconi, Ph.D.
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70
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2016
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James C. Czirr
, Chairman of the Board since February 2009 and Executive Chairman from
February 2010 until January 2016, is a
co-founder
of 10X Fund, L.P. and is a managing member of 10X Capital Management LLC, the general partner of 10X Fund, L.P. Mr. Czirr was a
co-founder
of Galectin Therapeutics in July 2000. Mr. Czirr was instrumental in the early stage development of Safe Science Inc., a developer of anti-cancer drugs; served from 2005 to 2008 as Chief Executive
Officer of Minerva Biotechnologies Corporation, a developer of nano particle bio chips to determine the cause of solid tumors; and was a consultant to Metalline Mining Company Inc., now known as Silver Bull Resources, Inc., (AMEX: SVBL), a mineral
exploration company seeking to become a low cost producer of zinc. Mr. Czirr received a B.B.A. degree from the University of Michigan. We believe that Mr. Czirr is best situated to sit on our Board because he is the director who was a
co-founder
of the Company and is familiar with our business and industry.
Theodore Zucconi,
Ph.D.
, served as president, CEO and business development director of Galectin Therapeutics from September 2007 through May 2012. Dr. Zucconi served as a senior management consultant to Los Alamos National Laboratory from May 2002 through
September 2007. Dr. Zucconi is a senior management consultant and a member of the board of directors of PMTec Inc., a position that he has held since 2001. Dr. Zucconi has also served as President of Implementation Edge LLC since 2002, Dr.
Zucconi held senior management positions with Northern Telecom, Bell Northern Research, Motorola and Hadco Corporations. During his more than 33 years in the electronics and telecommunications industries he authored over 12 patents and received one
outstanding invention award related to electronic components and manufacturing processes. As Director of Motorola University, he received an ASTD award for project management training, development and implementation. Dr. Zucconi received a B.S. in
Chemistry from Villanova University, a M.S. in Chemistry from University of Connecticut, and a Ph.D. in Chemistry from the State University of New York, an Executive MBA in International Finance from Thunderbird University and is a Stanford
Certified Project/Program Manager. We believe that Dr. Zucconi is best situated to sit on our Board of Directors because of his experience in working for the Company in the past and his industry experience.
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EXECUTIVE OFFICERS, KEY EMPLOYEES AND KEY CONSULTANTS
Peter G. Traber, M.D.,
age 62
,
a director since February 2009, became President and Chief Executive Officer in March 2011, and
is also our Chief Medical Officer. Dr. Traber is President Emeritus, and from 2003 to 2008 was President and Chief Executive Officer, of Baylor College of Medicine. From 2000 to 2003 he was Senior Vice President Clinical Development and Medical
Affairs and Chief Medical Officer of GlaxoSmithKline plc. Dr. Traber was the Chairman of the Board and Chief Executive Officer of TerraSep, LLC, a Mountain View, CA biotechnology company. He also has served as Chief Executive Officer of the
University of Pennsylvania Health System, as well as Chair of the Department of Internal Medicine and Chief of Gastroenterology for the University of Pennsylvania School of Medicine and was named as a director of NeoStem, Inc. (Nasdaq:NBS) in 2015.
Dr. Traber received his M.D. from Wayne State School of Medicine and a B.S. in chemical engineering from the University of Michigan.
Harold Shlevin, Ph.D.
, age 68, became our Chief Operating Officer and Secretary on October 1, 2012. Dr. Shlevin previously
had been employed at the Georgia Institute of Technologys Advanced Technology Development Center as Principle and Manager of bioscience commercialization efforts since November 2009, where he has assisted faculty in identifying technology
worthy of commercialization, catalyzed formation of new
start-up
bioscience companies, and mentored new company management. From October 2008 to November 2009, he served as Head of Operations and Commercial
Development for Altea Therapeutics Corporation, an advanced drug delivery company focused on the delivery of therapeutic levels of water-soluble biotherapeutics and small drugs through the skin. At Altea, he was responsible for pharmaceutical
research and development, clinical research, regulatory affairs, engineering, clinical and commercial manufacturing, quality assurance, information technology, facility operations and finance. From July 2006 to September 2008, Dr. Shlevin
served as the President and Chief Executive Officer of Tikvah Therapeutics, Inc., a
start-up
pharmaceutical enterprise focused on later-stage development of neuroscience therapeutics. From May 2000 to
January 2006, he served as President and CEO of Solvay Pharmaceuticals, Inc. (US). In January 2006, he was promoted to a global senior Vice President role within Solvay Pharmaceuticals, SA and member of the Board of Solvay Pharmaceuticals, SA.
Jack W. Callicutt
, age 50, became our Chief Financial Officer on July 1, 2013. From August 2012 through June 2012,
Mr. Callicutt was the Chief Financial Officer of REACH Health, Inc., a telemedicine technology company headquartered in Alpharetta, GA. From April 2010 through August 2012, Mr. Callicutt was the Chief Financial Officer of Vystar
Corporation, a publicly-traded company that holds proprietary technology to remove antigenic proteins from natural rubber latex. Prior to that Mr. Callicutt was Chief Financial Officer of IVOX, Inc., Tikvah Therapeutics and Corautus Genetics, a
publicly-traded biotechnology company which was developing gene therapy for treatment of cardiovascular disease. Mr. Callicutt previously spent more than fourteen years in public accounting, most recently as a senior manager at Deloitte, where
he specialized in technology companies from 1989 to 2003. Mr. Callicutt is a Certified Public Accountant and graduated with honors from Delta State University with a B.B.A. in accounting and computer information systems.
J. Rex Horton,
age 48, became the Companys Executive Director of Regulatory Affairs and Quality Assurance in January 2013.
Mr. Horton most recently was Director of Regulatory Affairs at Chelsea Therapeutics, where he successfully led the organization through its first NDA filing and favorable FDA Advisory Committee Meeting. In past leadership roles at Solvay
Pharmaceuticals and Abbott Laboratories, he led approval efforts for key products including Androgel
®
Stickpack, Creon
®
Capsules and
Luvox
®
CR Capsules. He has also provided chemistry, manufacturing and controls (CMC) regulatory leadership and support of INDs and NDAs, including Estrogel
®
and Androgel
®
Pump. Mr. Horton was a member of the executive leadership team that successfully implemented solutions to significant
regulatory issues encountered by Solvay in its interactions with the FDA. Mr. Horton earned his Bachelors degree in industrial/manufacturing & systems engineering from The Georgia Institute of Technology. He is a member of the
Regulatory Affairs Professional Society (RAPS), Drug Information Association (DIA) and American Association of Pharmaceutical Scientists (AAPS).
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Eliezer Zomer, Ph.D.,
age 70, has been our Executive Vice President of Manufacturing and
Product Development since the Companys inception in 2000. Prior to joining our Company, Dr. Zomer had been the founder of Alicon Biological Control, where he served from November 2000 to July 2002. From December 1998 to July 2000,
Dr. Zomer served as Vice President of Product Development at SafeScience, Inc. and Vice President of Research and Development at Charm Sciences, Inc. from June 1987 to November 1998. Dr. Zomer received a B. Sc. degree in industrial
microbiology from the University of Tel Aviv in 1972, a Ph.D. in biochemistry from the University of Massachusetts in 1978, and undertook a post-doctoral study at the National Institute of Health.
None of the directors, executive officers and key employees share any familial relationship.
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CORPORATE GOVERNANCE
Board of Directors
We believe that good
corporate governance is important to ensure that Galectin Therapeutics is managed for the long-term benefit of our stockholders. Our Board of Directors is responsible for establishing our corporate policies and overseeing the management of the
Company. Senior management, including our President and Chief Executive Officer, Chief Financial Officer and Chief Operating Officer, are responsible for our
day-to-day
operations. The Board evaluates our corporate performance and approves, among other things, corporate strategies, objectives, operating plans, significant
policies and major commitments of corporate resources. The Board also evaluates and elects our executive officers, and determines their compensation.
Our Board currently consists of ten directors, four of whom have been nominated for
re-election
at our
2017 Annual Meeting of stockholders and two of whom have been nominated and will be elected by the holder of our Series B Preferred Stock voting as a separate class. Three persons (referred to as the Series B Nominees) have been nominated for
election to the Board by the holder of our Series B Preferred Stock. While none of the Series B Nominees have previously served on the Board, Joel Lewis served as an observer to the Board during 2017.
Committees of the Board
Our Board has
standing Audit, Compensation, and Nominating and Corporate Governance Committees. From time to time, the Board may also create various ad hoc committees for special purposes. The membership during the last fiscal year and the function of
each of the Audit, Compensation, and Nominating and Corporate Governance Committees are described below. The board has determined that all of the members of each of the Audit, Compensation, and Nominating and Corporate Governance Committees are
independent as defined under the rules of the NASDAQ Stock Market, including, in the case of all members of the Audit Committee, the independence requirements contemplated by Rule
10A-3
under the Exchange Act.
The charters of each committee are available on the Companys website at
www.galectintherapeutics.com
.
Compensation Committee
The Compensation Committee met five times in 2016. Dr. Gilbert S. Omenn (chair), Gilbert F. Amelio, Ph.D. and Marc Rubin
are the members of the Compensation Committee. The Committee is responsible for reviewing and recommending compensation policies and programs, management and corporate goals, as well as salary and benefit levels for our executive officers and other
significant employees. Its responsibilities include supervision and oversight of the administration of our incentive compensation and stock programs. As such, the Committee is responsible for administration of grants and awards to directors,
officers, employees, consultants and advisors under the Galectin Therapeutics, Inc. Amended and Restated 2009 Incentive Compensation Plan (the 2009 Incentive Compensation Plan), and the predecessor Galectin Therapeutics, Inc. 2001 Stock
Incentive Plan and the 2003
Non-employee
Director Stock Incentive Plan.
Audit Committee
The Audit Committee met four times in 2016. The members of this committee are Steven Prelack (chair), Arthur Greenberg and Kevin D. Freeman.
The Audit Committee is responsible for oversight of the quality and integrity of the accounting, auditing and reporting practices of Galectin Therapeutics. More specifically, it assists the Board of Directors in fulfilling its oversight
responsibilities relating to (i) the quality and integrity of our financial statements, reports and related information provided to stockholders, regulators and others, (ii) our compliance with legal and regulatory requirements,
(iii) the qualifications, independence and performance of our independent registered public accounting firm, (iv) the internal control over financial reporting that management and the Board have established, and (v) the audit,
accounting and financial reporting processes generally. The Committee is also responsible for review and approval of related-party transactions. The Board has determined
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that Mr. Prelack is an audit committee financial expert within the meaning of SEC rules. The Audit Committee has the authority to obtain advice and assistance from, and receive
appropriate funding from the Company for, outside legal, accounting or other advisors as it deems necessary to carry out its duties.
Nominating and
Corporate Governance Committee
The Nominating and Corporate Governance Committee met three times in 2016. Gilbert F. Amelio, Ph.D.
(chair), John Mauldin and Marc Rubin are the members of the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee is responsible for identifying individuals qualified to become members of the Board,
recommending to the Board, candidates for election or
re-election
as directors, and reviewing our governance policies in light of the corporate governance rules of the SEC. Under its charter, the Committee is
required to establish and recommend criteria for service as a director, including matters relating to professional skills and experience, board composition, potential conflicts of interest and manner of consideration of individuals proposed by
management or stockholders for nomination. The Committee believes candidates for the Board should have the ability to exercise objectivity and independence in making informed business decisions; extensive knowledge, experience and judgment; the
highest integrity; loyalty to the interests of Galectin Therapeutics and its stockholders; a willingness to devote the extensive time necessary to fulfill a directors duties; the ability to contribute to the diversity of perspectives present
in board deliberations, and an appreciation of the role of the corporation in society. The Committee will consider candidates meeting these criteria who are suggested by directors, management, stockholders and other advisers hired to identify and
evaluate qualified candidates. This committee also monitors the ethical behavior of our employees, officers and directors.
Investor
Relations/Public Relations Committee
The Investor Relation/Public Relations Committee met once in 2016. James C. Czirr, Theodore
Zucconi and Arthur Greenberg are the members of the Investor Relations/Public Relations Committee. The Investor Relations/Public Relations Committee is responsible for (a) assisting the Board with strategic direction and overall status of our
investor relations and public relations programs and associated activities and (b) providing input and guidance regarding material investor relations and public relations issues.
Board Determination of Director Independence
Our Board has reviewed the materiality of any relationship that each of our directors has with the Company, either directly or indirectly.
Based upon this review, our Board has determined that all of our presently serving directors other than Dr. Traber, our chief executive officer, and Mr. Czirr are independent directors as defined by The NASDAQ Stock Market. The
Board has also determined that the Series B Nominees, Mr. Uihlein, Mr. Lewis and Mr. Shulman, who have been nominated for election at 2017 Annual Meeting, will be independent directors as defined by The NASDAQ Stock
Market. Our Board also determined that Dr. Amelio, Dr. Rubin and Mr. Mauldin, who comprise our presently serving Nominating and Corporate Governance Committee, all satisfy the independence standards for such committee established by
the SEC and the NASDAQ Marketplace Rules. With respect to our presently serving Audit Committee, our Board of directors has determined that Messrs. Prelack, Greenberg and Freeman satisfy the independence standards for such committee established by
Rule
10A-3
under the Exchange Act, the SEC and the NASDAQ Marketplace Rules, as applicable. With respect to our presently serving Compensation Committee, our Board of directors has determined that Drs. Omenn,
Amelio and Rubin satisfy the independence standards for such committee established by Rule
10C-1
under the Exchange Act, the SEC and the NASDAQ Marketplace Rules, as applicable.
In making such determinations, our Board considered the relationships that each such
non-employee
director or director nominee has with our company and all other facts and circumstances our Board deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each
18
non-employee
director. In considering the independence of our directors, our Board considered the association of each such
non-employee
director has with us and all other facts and circumstances our Board deemed relevant in determining independence.
Code of Ethics
We have adopted a Code of
Ethics that applies to all our directors, officers and employees. The Code of Ethics is publicly available on our website at www.galectintherapeutics.com. Amendments to the Code of Ethics and any grant of a waiver from a provision of the Code of
Ethics requiring disclosure under applicable SEC rules will be disclosed on our website.
Policies with Respect to Transactions with Related Persons
The Nominating and Corporate Governance Committee and the Board have adopted a Code of Ethics, which is available at
www.galectintherapeutics.com, that sets forth various policies and procedures intended to promote the ethical behavior of the Companys employees, officers and directors. The Code of Ethics describes our policy on conflicts of interest.
The executive officers and the Board are also required to complete a questionnaire on an annual basis which requires them to disclose any
related person transactions and potential conflicts of interest. The responses to these questionnaires are reviewed by outside corporate counsel, and, if a transaction is reported by an independent director or executive officer, the questionnaire is
submitted to the Chairperson of the Audit Committee for review. If necessary, the Audit Committee will determine whether the relationship is material and will have any effect on the directors independence. After making such determination, the
Audit Committee will report its recommendation on whether the transaction should be approved or ratified by the entire Board.
PROPOSAL NO. 4
TO APPROVE AN AMENDMENT TO OUR
AMENDED AND RESTATED 2009 INCENTIVE COMPENSATION PLAN TO RESERVE
AN ADDITIONAL 1,000,000 SHARES FOR ISSUANCE UNDER THE PLAN
On October 9, 2017, upon recommendation of the Compensation Committee, the Board approved, subject to stockholder approval, an amendment
to the Companys Amended and Restated 2009 Incentive Compensation Plan (the Plan), to reserve an additional 1,000,000 shares for issuance under the Plan. Otherwise, the Plan remains unchanged. The Plan, as proposed to be amended, is
attached hereto as
Appendix B
, and we urge stockholders to review the Plan carefully.
Under applicable NASDAQ rules, the
Company is required to obtain stockholder approval of the proposed amendment to the Plan. Stockholder approval of the Plan is also required (i) to comply with certain exclusions from the limitations of Section 162(m) of the Internal
Revenue Code of 1986, which we refer to as the Code, as described below, and (ii) to comply with the incentive stock options rules under Section 422 of the Code. On October 16, 2017, the closing price of our common stock as reported by
NASDAQ was $2.31.
We are currently authorized to issue up to 4,733,334 shares of common stock under the Plan, of which 166 remain
available for issuance as of October 16, 2017. If approved by the Companys stockholders, the amendment to the Plan would authorize an additional 1,000,000 for issuance under the Plan. The material terms of the Plan are as follows:
Background and Purpose
On
February 12, 2009, our Board of Directors adopted the 2009 Incentive Compensation Plan, and our stockholders subsequently approved the Plan at the Companys 2009 annual meeting.
The purpose of the Plan is to assist our company and its subsidiaries and other designated affiliates, which we refer to as related
entities, in attracting, motivating, retaining and rewarding high-quality executives and other employees, officers, directors consultants and other persons who provide services to our company or its related entities, by enabling such persons
to acquire or increase a proprietary interest in our company in order to strengthen the mutuality of interests between such persons and our stockholders, and providing such persons with annual and long-term performance incentives to expend their
maximum efforts in the creation of stockholder value.
Summary of the Plan
The following is a summary of certain principal features of the Plan, as proposed to be amended. This summary is qualified in its entirety by
reference to the complete text of the Plan, as amended. Stockholders are urged to read the actual text of the Plan, as proposed to be amended, in its entirety which is set forth as
Appendix B
to this proxy statement.
Shares Available for Awards; Annual
Per-Person
Limitations.
Under the Plan, as amended,
the total number of shares of common stock of our Company reserved and available for delivery under the Plan (the awards) at any time during the term of the Plan shall be equal to 5,733,334 shares of common stock (increased from
4,733,334 under the current Plan). The number of shares in the Plan shall be increased by the number of shares of common stock with respect to which awards previously granted under the Plan that are forfeited, expire or otherwise terminate without
issuance of shares, or that are settled for cash or otherwise do not result in the issuance of shares, and the number of shares that are tendered (either actually or by attestation) or withheld upon exercise of an award to pay the exercise price or
any tax withholding requirements. Awards issued in substitution for awards previously granted by a company acquired by our Company or a related entity, or with which our Company or any related entity combines, do not reduce the limit on grants of
awards under the Plan.
43
The Plan imposes individual limitations on the amount of certain awards in part to comply with
Code Section 162(m). Under these limitations, during any
12-month
period, no participant may be granted (i) stock options or stock appreciation rights with respect to more than 2,000,000 shares of
common stock, or (ii) shares of restricted stock, shares of deferred stock, performance shares and other stock based-awards with respect to more than 2,000,000 shares of common stock, in each case, subject to adjustment in certain
circumstances. The maximum amount that may be paid out as performance units with respect to any
12-month
performance period is $1,000,000, and is $3,000,000 with respect to any performance period that is more
than 12 months.
The Compensation Committee of our Board of Directors is authorized to adjust the limitations described in the two
preceding paragraphs and is authorized to adjust outstanding awards (including adjustments to exercise prices of options and other affected terms of awards) in the event that a dividend or other distribution (whether in cash, shares of common stock
or other property), recapitalization, forward or reverse split, reorganization, merger, consolidation,
spin-off,
combination, repurchase, share exchange or other similar corporate transaction or event affects
the common stock so that an adjustment is appropriate. The Compensation Committee is also authorized to adjust performance conditions and other terms of awards in response to these kinds of events or in response to changes in applicable laws,
regulations or accounting principles.
Eligibility.
The persons eligible to receive awards under the Plan are the officers,
directors, employees, consultants and other persons who provide services to our Company or any related entity. An employee on a leave of absence may still be considered an employee of our Company or a related entity for purposes of eligibility for
participation in the Plan. As of October 16, 2017, the Company had seven employees (including officers) and ten members of the Board eligible to receive awards under the Plan.
Administration.
The Plan is to be administered by the Compensation Committee, provided, however, that except as otherwise
expressly provided in the Plan, our Board of Directors may exercise any power or authority granted to the Compensation Committee under the Plan. Subject to the terms of the Plan, the Compensation Committee is authorized to select eligible persons to
receive awards, determine the type, number and other terms and conditions of, and all other matters relating to, awards, prescribe award agreements (which need not be identical for each participant), and the rules and regulations for the
administration of the Plan, construe and interpret the Plan and award agreements, correct defects, supply omissions or reconcile inconsistencies therein, and make all other decisions and determinations as the Compensation Committee may deem
necessary or advisable for the administration of the Plan.
Stock Options and Stock Appreciation Rights.
The Compensation
Committee is authorized to grant stock options, including both incentive stock options (ISOs), which can result in potentially favorable tax treatment to the participant, and
non-qualified
stock
options, and stock appreciation rights entitling the participant to receive the amount by which the fair market value of a share of common stock on the date of exercise exceeds the grant price of the stock appreciation right. The exercise price per
share subject to an option and the grant price of a stock appreciation right are determined by the Compensation Committee, but must not be less than the fair market value of a share of common stock on the date of grant. For purposes of the Plan, the
term fair market value means the fair market value of common stock, awards or other property as determined by the Compensation Committee or under procedures established by the Compensation Committee. Unless otherwise determined by the
Compensation Committee, the fair market value of common stock as of any given date shall be the closing sales price per share of common stock as reported on the principal stock exchange or market on which common stock is traded on the date as of
which such value is being determined or, if there is no sale on that date, then on the last previous day on which a sale was reported. The maximum term of each option or stock appreciation right, the times at which each option or stock appreciation
right will be exercisable, and provisions requiring forfeiture of unexercised options or stock appreciation rights at or following termination of employment generally are fixed by the Compensation Committee, except that no option or stock
appreciation right may have a term exceeding ten years. Methods of exercise and settlement and other terms of the stock appreciation right are determined by the Compensation Committee. The Compensation Committee, thus, may permit the exercise price
of options awarded under the Plan to be paid in cash, shares, other awards or other
44
property (including loans to participants). Options may be exercised by payment of the exercise price in cash, shares of common stock, outstanding awards or other property having a fair market
value equal to the exercise price, as the Compensation Committee may determine from time to time.
Restricted and Deferred
Stock.
The Compensation Committee is authorized to grant restricted stock and deferred stock. Restricted stock is a grant of shares of common stock which may not be sold or disposed of, and which shall be subject to such risks of
forfeiture and other restrictions as the Compensation Committee may impose. A participant granted restricted stock generally has all of the rights of a stockholder of our Company, unless otherwise determined by the Compensation Committee. An award
of deferred stock confers upon a participant the right to receive shares of common stock at the end of a specified deferral period, subject to such risks of forfeiture and other restrictions as the Compensation Committee may impose. Prior to
settlement, an award of deferred stock carries no voting or dividend rights or other rights associated with share ownership, although dividend equivalents may be granted, as discussed below.
Dividend Equivalents.
The Compensation Committee is authorized to grant dividend equivalents conferring on participants the
right to receive, currently or on a deferred basis, cash, shares of common stock, other awards or other property equal in value to dividends paid on a specific number of shares of common stock or other periodic payments. Dividend equivalents may be
granted alone or in connection with another award, may be paid currently or on a deferred basis and, if deferred, may be deemed to have been reinvested in additional shares of common stock, awards or otherwise as specified by the Compensation
Committee.
Bonus Stock and Awards in Lieu of Cash Obligations.
The Compensation Committee is authorized to grant shares of
common stock without restrictions as a bonus or to grant shares of common stock or other awards in lieu of Company obligations to pay cash under the Plan or other plans or compensatory arrangements, subject to such terms as the Compensation
Committee may specify.
Other Stock-Based awards.
The Compensation Committee or our Board of Directors is authorized to
grant awards that are denominated or payable in, valued by reference to, or otherwise based on or related to shares of common stock. The Compensation Committee determines the terms and conditions of such awards.
Performance awards.
The Compensation Committee is authorized to grant performance awards to participants on terms and conditions
established by the Compensation Committee. The performance criteria to be achieved during any performance period and the length of the performance period is determined by the Compensation Committee upon the grant of the performance award; provided,
however, that a performance period cannot be shorter than 12 months or longer than 5 years. Performance awards may be valued by reference to a designated number of shares (in which case they are referred to as performance shares) or by reference to
a designated amount of property including cash (in which case they are referred to as performance units). Performance awards may be settled by delivery of cash, shares or other property, or any combination thereof, as determined by the Compensation
Committee. Performance awards granted to persons whom the Compensation Committee expects will, for the year in which a deduction arises, be covered employees (as defined below), and will, if and to the extent intended by the Compensation
Committee, be subject to provisions that should qualify such awards as performance-based compensation not subject to the limitation on tax deductibility by our Company under Code Section 162(m). For purposes of Section 162(m),
the term covered employee means our Companys chief executive officer and each other person whose compensation is required to be disclosed in our Companys filings with the SEC by reason of that person being among the five
highest compensated officers of our Company as of the end of a taxable year. If and to the extent required under Section 162(m) of the Code, any power or authority relating to a performance award intended to qualify under Section 162(m) of
the Code is to be exercised by the Compensation Committee and not our Board of Directors.
If and to the extent that the Compensation
Committee determines that these provisions of the Plan are to be applicable to any performance award, one or more of the following business criteria for our Company, on a consolidated basis, and/or for related entities, or for business or
geographical units of our Company and/or a
45
related entity (except with respect to the total stockholder return and earnings per share criteria), shall be used by the Compensation Committee in establishing performance goals for performance
awards under the Plan: (1) earnings per share; (2) revenues or margins; (3) cash flow; (4) operating margin; (5) return on assets, net assets, investment, capital, operating revenue or equity; (6) economic value added;
(7) direct contribution; (8) income; net income; pretax earnings; earnings before interest and taxes; earnings before interest, taxes, depreciation and amortization; earnings after interest expense and before extraordinary or special
items; operating income; net operating income; income before interest income or expense, unusual items and income taxes, local, state or federal and excluding budgeted and actual bonuses which might be paid under any ongoing bonus plans of our
Company; (9) working capital or working capital management, including inventory turnover and days sales outstanding; (10) management of fixed costs or variable costs; (11) identification or consummation of investment opportunities or
completion of specified projects in accordance with corporate business plans, including strategic mergers, acquisitions or divestitures; (12) total stockholder return; (13) debt reduction; (14) market share; (15) entry into new
markets, either geographically or by business unit; (16) customer retention and satisfaction; (17) strategic plan development and implementation, including turnaround plans; and (18) stock price. Any of the above goals may be
determined on an absolute or relative basis (e.g. growth in earnings per share) or as compared to the performance of a published or special index deemed applicable by the Compensation Committee including, but not limited to, the Standard &
Poors 500 Stock Index or a group of companies that are comparable to our Company. The Compensation Committee may exclude the impact of an event or occurrence which the Compensation Committee determines should appropriately be excluded,
including without limitation (i) restructurings, discontinued operations, extraordinary items, and other unusual or
non-recurring
charges, (ii) an event either not directly related to the operations
of our Company or not within the reasonable control of our Companys management, or (iii) a change in accounting standards required by generally accepted accounting principles.
The Compensation Committee may, in its discretion, determine that the amount payable as a performance award will be reduced from the amount of
any potential award.
Other Terms of Awards.
Awards may be settled in the form of cash, shares of common stock, other awards
or other property, in the discretion of the Compensation Committee. The Compensation Committee may require or permit participants to defer the settlement of all or part of an award in accordance with such terms and conditions as the Compensation
Committee may establish, including payment or crediting of interest or dividend equivalents on deferred amounts, and the crediting of earnings, gains and losses based on deemed investment of deferred amounts in specified investment vehicles. The
Compensation Committee is authorized to place cash, shares of common stock or other property in trusts or make other arrangements to provide for payment of our Companys obligations under the Plan. The Compensation Committee may condition any
payment relating to an award on the withholding of taxes and may provide that a portion of any shares of common stock or other property to be distributed will be withheld (or previously acquired shares of common stock or other property be
surrendered by the participant) to satisfy withholding and other tax obligations. Awards granted under the Plan generally may not be pledged or otherwise encumbered and are not transferable except by will or by the laws of descent and distribution,
or to a designated beneficiary upon the participants death, except that the Compensation Committee may, in its discretion, permit transfers for estate planning or other purposes subject to any applicable restrictions under Rule
16b-3.
Awards under the Plan are generally granted without a requirement that the participant pay
consideration in the form of cash or property for the grant (as distinguished from the exercise), except to the extent required by law. The Compensation Committee may, however, grant awards in exchange for other awards under the Plan, awards under
other Company plans, or other rights to payment from our Company, and may grant awards in addition to and in tandem with such other awards, rights or other awards.
Acceleration of Vesting; Change in Control.
The Compensation Committee may, in its discretion, accelerate the exercisability,
the lapsing of restrictions or the expiration of deferral or vesting periods of any award, and such accelerated exercisability, lapse, expiration and, vesting shall occur automatically in the case of a change
46
in control of our Company (including the cash settlement of stock appreciation rights which may be exercisable in the event of a change in control), if so provided in the award agreement or
otherwise determined by the Compensation Committee,. In addition, the Compensation Committee may provide in an award agreement that the performance goals relating to any performance award will be deemed to have been met upon the occurrence of any
change in control. For purposes of the Plan, unless otherwise specified in an award agreement, a change in control means the occurrence of any of the following:
(i) The acquisition by any person (as that term is used in the Exchange Act) of Beneficial Ownership (within the meaning of Rule
13d-3
promulgated under the Exchange Act) of more than 50% of either (A) the then outstanding shares of common stock of our Company (the Outstanding Company Common Stock) or (B) the combined
voting power of our then outstanding voting securities entitled to vote generally in the election of directors (the Outstanding Company Voting Securities) (the foregoing Beneficial Ownership hereinafter being referred to as a
Controlling Interest); provided, however, that the following acquisitions shall not constitute or result in a Change of Control: (v) any acquisition directly from our Company; (w) any acquisition by our Company; (x) any
acquisition by any person that as of the effective date owns Beneficial Ownership of a Controlling Interest; (y) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by our Company or any subsidiary; or
(z) any acquisition by any corporation pursuant to a transaction which complies with clauses (A), (B) and (C) of subsection (iii) below; or
(ii) During any period of three (3) consecutive years (not including any period prior to the effective date of the Plan) individuals who
constitute our board on the effective date (the Incumbent Board) cease for any reason to constitute at least a majority of our board; provided, however, that any individual becoming a director subsequent to the effective date whose
election, or nomination for election by our stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a person other than our board; or
(iii) Consummation of a reorganization, merger, statutory share
exchange or consolidation or similar corporate transaction involving our Company or any of its subsidiaries, a sale or other disposition of all or substantially all of the assets of our Company, or the acquisition of assets or stock of another
entity by our Company or any of its subsidiaries (each a Business Combination), in each case, unless, following such Business Combination, (A) all or substantially all of the individuals and entities who were the Beneficial Owners,
respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then outstanding shares of common stock and
the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns our Company or all or substantially all of our Companys assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately
prior to such Business Combination of the Outstanding Company common stock and Outstanding Company Voting Securities, as the case may be, (B) no person (excluding any employee benefit plan (or related trust) of our Company or such corporation
resulting from such Business Combination or any person that as of the effective date owns Beneficial Ownership of a Controlling Interest) beneficially owns, directly or indirectly, 50% or more of the then outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (C) at least
a majority of the members of the Board of Directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for
such Business Combination; or a
(iv) Approval by our stockholders of a complete liquidation or dissolution of our Company.
47
Amendment and Termination.
Our Board may amend, alter, suspend, discontinue or
terminate the Plan or the Compensation Committees authority to grant awards without further stockholder approval, except that stockholder approval must be obtained for any amendment or alteration if such approval is required by law or
regulation or under the rules of any stock exchange or quotation system on which shares of common stock are then listed or quoted. Thus, stockholder approval may not necessarily be required for every amendment to the Plan which might increase the
cost of the Plan or alter the eligibility of persons to receive awards. Stockholder approval will not be deemed to be required under laws or regulations, such as those relating to ISOs, that condition favorable treatment of participants on such
approval, although our Board may, in its discretion, seek stockholder approval in any circumstance in which it deems such approval advisable. Unless earlier terminated by our board, the Plan will terminate at the earliest of (a) such time as no
shares of common stock remain available for issuance under the Plan, (b) termination of the Plan by our board, or (c) the tenth anniversary of the effective date of the Plan. Awards outstanding upon expiration of the Plan shall remain in
effect until they have been exercised or terminated, or have expired.
Federal Income Tax Consequences of Awards
IRS Circular 230 Notice
To ensure compliance with requirements imposed by the Internal Revenue Service, you are hereby
notified that any discussion of tax matters set forth in this Summary was written in connection with the promotion or marketing (within the meaning of IRS Circular 230) of awards made under the Plan, and was not intended or written to be used, and
cannot be used, by any taxpayer for the purpose of avoiding any
tax-related
penalties under federal law. Each recipient of an award under the Plan should seek advice based on his or her particular
circumstances from an independent tax advisor.
The Plan is not qualified under the provisions of Code Section 401(a) and is not
subject to any of the provisions of the Employee Retirement Income Security Act of 1974.
Nonqualified Stock Options.
On
exercise of a nonqualified stock option granted under the Plan an optionee will recognize ordinary income equal to the excess, if any, of the fair market value on the date of exercise of the shares of stock acquired due to the exercise of the option
over the exercise price. If the optionee is an employee of our Company or a related entity, that income will be subject to the withholding of Federal income tax. The optionees tax basis in those shares will be equal to their fair market value
on the date of exercise of the option, and his holding period for those shares will begin on that date. If an optionee pays for shares of stock on exercise of an option by delivering shares of our Companys stock, the optionee will not
recognize gain or loss on the shares delivered, even if their fair market value at the time of exercise differs from the optionees tax basis in them. The optionee, however, otherwise will be taxed on the exercise of the option in the manner
described above as if he had paid the exercise price in cash. If a separate identifiable stock certificate is issued for that number of shares equal to the number of shares delivered on exercise of the option, the optionees tax basis in the
shares represented by that certificate will be equal to his tax basis in the shares delivered, and his holding period for those shares will include his holding period for the shares delivered. The optionees tax basis and holding period for the
additional shares received on exercise of the option will be the same as if the optionee had exercised the option solely in exchange for cash.
Our Company will be entitled to a deduction for Federal income tax purposes equal to the amount of ordinary income taxable to the optionee,
provided that amount constitutes an ordinary and necessary business expense for our Company and is reasonable in amount, and either the employee includes that amount in income or our Company timely satisfies its reporting requirements with respect
to that amount.
Incentive Stock Options.
The Plan provides for the grant of stock options that qualify as incentive
stock options as defined in section 422 of the Code (which we refer to as ISOs). Under the Code, an optionee generally is not subject to tax upon the grant or exercise of an ISO. In addition, if the optionee holds a share received
on exercise of an ISO for at least two years from the date the option was granted and at least one year from the date the option was exercised (which we refer to as the Required Holding Period), the difference, if
48
any, between the amount realized on a sale or other taxable disposition of that share and the holders tax basis in that share will be long-term capital gain or loss.
If, however, an optionee disposes of a share acquired on exercise of an ISO before the end of the Required Holding Period (which we refer to
as a Disqualifying Disposition), the optionee generally will recognize ordinary income in the year of the Disqualifying Disposition equal to the excess, if any, of the fair market value of the share on the date the ISO was exercised over
the exercise price. If, however, the Disqualifying Disposition is a sale or exchange on which a loss, if realized, would be recognized for Federal income tax purposes, and if the sales proceeds are less than the fair market value of the share on the
date of exercise of the option, the amount of ordinary income recognized by the optionee will not exceed the gain, if any, realized on the sale. If the amount realized on a Disqualifying Disposition exceeds the fair market value of the share on the
date of exercise of the option, that excess will be short-term or long-term capital gain, depending on whether the holding period for the share exceeds one year.
An optionee who exercises an ISO by delivering shares of stock acquired previously pursuant to the exercise of an ISO before the expiration of
the Required Holding Period for those shares is treated as making a Disqualifying Disposition of those shares. This rule prevents pyramiding or the exercise of an ISO (that is, exercising an ISO for one share and using that share, and
others so acquired, to exercise successive ISOs) without the imposition of current income tax.
For purposes of the alternative minimum
tax, the amount by which the fair market value of a share of stock acquired on exercise of an ISO exceeds the exercise price of that option generally will be an adjustment included in the optionees alternative minimum taxable income for the
year in which the option is exercised. If, however, there is a Disqualifying Disposition of the share in the year in which the option is exercised, there will be no adjustment with respect to that share. If there is a Disqualifying Disposition in a
later year, no income with respect to the Disqualifying Disposition is included in the optionees alternative minimum taxable income for that year. In computing alternative minimum taxable income, the tax basis of a share acquired on exercise
of an ISO is increased by the amount of the adjustment taken into account with respect to that share for alternative minimum tax purposes in the year the option is exercised.
Our Company is not allowed an income tax deduction with respect to the grant or exercise of an incentive stock option or the disposition of a
share acquired on exercise of an incentive stock option after the Required Holding Period. However, if there is a Disqualifying Disposition of a share, our Company is allowed a deduction in an amount equal to the ordinary income includible in income
by the optionee, provided that amount constitutes an ordinary and necessary business expense for our Company and is reasonable in amount, and either the employee includes that amount in income or our Company timely satisfies its reporting
requirements with respect to that amount.
Stock awards.
Generally, the recipient of a stock award will recognize ordinary
compensation income at the time the stock is received equal to the excess, if any, of the fair market value of the stock received over any amount paid by the recipient in exchange for the stock. If, however, the stock is
non-vested
when it is received under the Plan (for example, if the employee is required to work for a period of time in order to have the right to sell the stock), the recipient generally will not recognize income
until the stock becomes vested, at which time the recipient will recognize ordinary compensation income equal to the excess, if any, of the fair market value of the stock on the date it becomes vested over any amount paid by the recipient in
exchange for the stock. A recipient may, however, file an election with the Internal Revenue Service, within 30 days of his or her receipt of the stock award, to recognize ordinary compensation income, as of the date the recipient receives the
award, equal to the excess of the fair market value of the stock on the date the award is granted over any amount paid by the recipient in exchange for the stock, if any.
The recipients basis for the determination of gain or loss upon the subsequent disposition of shares acquired as stock awards will be
the amount paid for such shares plus any ordinary income recognized either when the
49
stock is received or when the stock becomes vested. Upon the disposition of any stock received as a stock award under the Plan the difference between the sale price and the recipients basis
in the shares will be treated as a capital gain or loss and generally will be characterized as long-term capital gain or loss if the shares have been held for more the one year from the date as of which he or she would be required to recognize any
compensation income.
Stock Appreciation Rights.
Our Company may grant stock appreciation rights (SARs) separate
from any other award (which we refer to as Stand-Alone SARs) or in tandem with options (which we refer to as Tandem SARs), under the Plan. Generally, the recipient of a Stand-Alone SAR will not recognize any taxable income at
the time the Stand-Alone SAR is granted.
With respect to Stand-Alone SARs, if the recipient receives the appreciation inherent in the
SARs in cash, the cash will be taxable as ordinary compensation income to the recipient at the time that the cash is received. If the recipient receives the appreciation inherent in the SARs in shares of stock, the recipient will recognize ordinary
compensation income equal to the excess of the fair market value of the stock on the day it is received over any amounts paid by the recipient for the stock.
With respect to Tandem SARs, if the recipient elects to surrender the underlying option in exchange for cash or shares of stock equal to the
appreciation inherent in the underlying option, the tax consequences to the recipient will be the same as discussed above relating to the Stand-Alone SARs. If the recipient elects to exercise the underlying option, the holder will be taxed at the
time of exercise as if he or she had exercised a nonqualified stock option (discussed above), i.e., the recipient will recognize ordinary income for federal tax purposes measured by the excess of the then fair market value of the shares of stock
over the exercise price.
In general, there will be no federal income tax deduction allowed to our Company upon the grant or termination
of Stand-Alone SARs or Tandem SARs. Upon the exercise of either a Stand-Alone SAR or a Tandem SAR, however, our Company will be entitled to a deduction for federal income tax purposes equal to the amount of ordinary income that the employee is
required to recognize as a result of the exercise, provided that the deduction is not otherwise disallowed under the Code.
Dividend
Equivalents.
Generally, the recipient of a dividend equivalent award will recognize ordinary compensation income at the time the dividend equivalent award is received equal to the fair market value dividend equivalent award received. Our
Company generally will be entitled to a deduction for federal income tax purposes equal to the amount of ordinary income that the employee is required to recognize as a result of the dividend equivalent award, provided that the deduction is not
otherwise disallowed under the Code.
Limitation on Company Deductions
. No federal income tax deduction is allowed for the Company
for any compensation paid to a covered employee in any taxable year of the Company to the extent that his or her compensation exceeds $1,000,000. For this purpose, covered employees are generally the chief executive officer
of the Company and the three other most highly compensated officers of the Company other than the principal financial officer for the taxable year, and the term compensation generally includes amounts includable in gross income as a
result of the exercise of stock options or SARs, payments pursuant to performance awards or other-based awards, or the receipt of restricted or deferred stock. This deduction limitation, however, does not apply to compensation that is
(1) commission-based compensation, (2) performance-based compensation, (3) compensation which would not be includable in an employees gross income, and (4) compensation payable under a written binding contract in existence
on February 17, 1993, and not materially modified after that date. The Compensation Committee intends to administer the Plan in a manner that maximizes the Companys tax deductions under Code Section 162(m).
Code Section
409A.
Section 409A of the Code imposes certain requirements applicable to
nonqualified deferred compensation plans, including rules relating to the timing of deferral elections and elections with regard to the form and timing of benefit distributions, prohibitions against the acceleration of the timing of
50
distributions, and the times when distributions may be made, as well as rules that generally prohibit the funding of nonqualified deferred compensation plans in offshore trusts or upon the
occurrence of a change in the employers financial health. If a nonqualified deferred compensation plan subject to Code Section 409A fails to meet, or is not operated in accordance with, these requirements, then all compensation deferred
under the plan is or becomes immediately taxable to the extent that it is not subject to a substantial risk of forfeiture and was not previously taxable. The tax imposed as a result of these rules would be increased by interest at a rate equal to
the rate imposed upon tax underpayments plus one percentage point, and an additional tax equal to 20% of the compensation required to be included in income. Some of the awards to be granted under this Plan may constitute deferred compensation
subject to the Code Section 409A requirements, including, without limitation, discounted stock options, deferred stock and SARs that are not payable in shares of our Company stock. It is our intention that any award agreement that will govern
awards subject to Code Section 409A will comply with these rules.
Importance of Consulting Tax Adviser.
The
information set forth above is a summary only and does not purport to be complete. In addition, the information is based upon current Federal income tax rules and therefore is subject to change when those rules change. Moreover, because the tax
consequences to any recipient may depend on his particular situation, each recipient should consult his tax adviser as to the Federal, state, local and other tax consequences of the grant or exercise of an award or the disposition of stock acquired
as a result of an award.
Certain Interests of Directors
In considering the recommendation of the Board with respect to the Plan, stockholders of the Company should be aware that members of the Board
may from time to time have interests that present them with conflicts of interest in connection with the proposal to approve the amendment to the Plan. Specifically, the amended Plan would add shares that are eligible for grant under the Plan, and
directors, including members of the Compensation Committee, could be recipients of awards with respect to these additional shares. The Board believes that approval of the amendment to the Plan will advance the interests of the Company and its
shareholders by encouraging employees and directors to make significant contributions to the long-term success of the Company.
Past Grants Under the
Plan
Because of the discretionary nature of any future awards under the Plan, the amount of such awards is not determinable at this
time with respect to our directors, executive officers, including the named executive officers, and the companys other employees. Option awards in fiscal year 2016 under the Plan, which were the only form of award granted under the Plan during
fiscal year 2016, were as follows:
|
|
|
|
|
|
|
|
|
Name and Position
|
|
Dollar Value
(1)
|
|
|
Number of
Securities
Underlying
Options
|
|
Peter G. Traber, M.D., Chief Executive Officer & President
|
|
$
|
288,136
|
|
|
|
354,000
|
|
Harold H. Shlevin, Ph.D., Chief Operating Officer
|
|
$
|
140,587
|
|
|
|
188,000
|
|
Jack W. Callicutt, Chief Financial Officer
|
|
$
|
140,587
|
|
|
|
188,000
|
|
Current executive officers as a group
|
|
$
|
569,310
|
|
|
|
730,000
|
|
Current
non-employee
directors as a group
|
|
$
|
229,652
|
|
|
|
332,250
|
|
Employees other than executive officers as a group
|
|
$
|
275,634
|
|
|
|
372,500
|
|
(1)
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Represents the grant date fair value of option awards based upon the Black Scholes valuation model made in 2016. For a description of the assumptions used to determine these amounts, see Note 7 to the Notes to the
Consolidated Financial Statements in our Annual Report on Form
10-K/A
for the fiscal year ended December 31, 2016.
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Information regarding options and other grants in fiscal year 2016 to certain executive officers
of the Company under the Plan is set forth in the table above under the heading Grants of Plan Based Awards in 2016, and information regarding outstanding options and grants under the Plan is set forth in the table above under the
heading Outstanding Equity Awards at Fiscal-Year End December 31, 2016. Information regarding grants under the Plan in fiscal year 2016 to our
non-employee
directors is set forth in the table
above under the heading Director Compensation.
Equity Compensation Plans of the Company
Information about the securities issued, or authorized for future issuance, under our equity compensation plans is set forth in the table under
the heading Equity Compensation Plan Information above.
Vote Required
The affirmative vote of a majority of the votes cast, either for, against or abstain, by the holders of the shares of common stock voting is
required to approve this proposal. Accordingly, abstentions and broker
non-votes
will have no effect. Additionally, under the Series B Designation Certificate, the consent of the holder of our Series B
Preferred Stock is required for an amendment to increase the number of shares of common stock reserved under our Amended and Restated 2009 Incentive Compensation Plan. 10X Fund, as the holder of all issued and outstanding shares of Series B
Preferred, has consented to the proposed amendment.
OUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
APPROVAL OF THE PROPOSED AMENDMENT TO THE AMENDED AND RESTATED 2009 INCENTIVE COMPENSATION PLAN.
52
Appendix A
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BARBARA K. CEGAVSKE
Secretary of State
202 North Carson Street
Carson City, Nevada 89701-4201
(775) 684-5708
Website: www.nvsos.gov
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Certificate of Amendment
(PURSUANT TO NRS 78.385 AND 78.390)
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USE BLACK INK ONLY DO NOT HIGHLIGHT
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ABOVE SPACE IS FOR OFFICE USE ONLY
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Certificate of Amendment to Articles of Incorporation
For Nevada Profit Corporations
(Pursuant to NRS 78.385 and 78.390 - After Issuance of Stock)
1. Name of corporation:
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Galectin Therapeutics, Inc.
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2. The articles have been amended as follows: (provide article numbers, if available)
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This Certificate of Amendment amends the Restated
Articles of Incorporation by deleting the first sentence of Article III of the Restated Articles of Incorporation and replacing such sentence in its entirety with the following: The corporation shall have authority to issue an aggregate of
100,000,000 shares, which shall be common voting shares having a par value of $0.001 per share, and 20,000,000 undesignated shares having a par value of $0.01 per share.
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3. The vote by which the stockholders holding shares in the corporation entitling them to exercise at least a majority of the voting power, or such greater proportion of the voting power as may be required in the case of
a vote by classes or series, or as may be required by the provisions of the articles of incorporation* have voted in favor of the amendments is:
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4. Effective date and time of filing: (optional)
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Date:
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Time:
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(must not be later than 90 days after the certificate is
filed)
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5. Signature: (required)
* If any proposed amendment would alter or change any preference or any relative or other right given to any class or series of
outstanding shares, then the amendment must be approved by the vote, in addition to the alternative vote otherwise required, of the holders of shares representing a majority of the voting power of each class or series affected by the amendment
regardless to limitations or restrictions on the voting power threof.
IMPORTANT:
Failure to Include any of the above information and submit with the
proper fees may cause this filing to be rejected.
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This form must be accompanied by appropriate fees.
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Nevada Secretary of State Amend Profit-After
Revised:1-5-15
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A-1
Appendix B
AMENDED AND RESTATED
GALECTIN THERAPEUTICS INC.
2009 INCENTIVE COMPENSATION PLAN
(AS AMENDED BY PROPOSAL NO. 4)
GALECTIN THERAPEUTICS, INC.
AMENDED AND RESTATED 2009 INCENTIVE COMPENSATION PLAN
1.
Purpose
. The purpose of this GALECTIN THERAPEUTICS, INC. AMENDED AND RESTATED 2009 INCENTIVE COMPENSATION PLAN (the
Plan) is to assist Galectin Therapeutics, Inc., a Nevada corporation (the Company) and its Related Entities (as hereinafter defined) in attracting, motivating, retaining and rewarding high-quality executives and other
employees, officers, directors, consultants and other persons who provide services to the Company or its Related Entities by enabling such persons to acquire or increase a proprietary interest in the Company in order to strengthen the mutuality of
interests between such persons and the Companys shareholders, and providing such persons with annual and long term performance incentives to expend their maximum efforts in the creation of shareholder value.
2.
Definitions
. For purposes of the Plan, the following terms shall be defined as set forth below, in addition to such terms
defined in Section 1 hereof and elsewhere herein.
(a)
Award
means any Option, Stock Appreciation Right,
Restricted Stock Award, Deferred Stock Award, Share granted as a bonus or in lieu of another Award, Dividend Equivalent, Other Stock-Based Award or Performance Award, together with any other right or interest, granted to a Participant under the
Plan.
(b)
Award Agreement
means any written agreement, contract or other instrument or document evidencing any
Award granted by the Committee hereunder.
(c)
Beneficiary
means the person, persons, trust or trusts that have
been designated by a Participant in his or her most recent written beneficiary designation filed with the Committee to receive the benefits specified under the Plan upon such Participants death or to which Awards or other rights are
transferred if and to the extent permitted under Section 10(b) hereof. If, upon a Participants death, there is no designated Beneficiary or surviving designated Beneficiary, then the term Beneficiary means the person, persons, trust or
trusts entitled by will or the laws of descent and distribution to receive such benefits.
(d)
Beneficial Owner
and Beneficial Ownership
shall have the meaning ascribed to such term in Rule
13d-3
under the Exchange Act and any successor to such Rule.
(e)
Board
means the Companys Board of Directors.
(f)
Cause
shall, with respect to any Participant, have the meaning specified in the Award Agreement. In the absence
of any definition in the Award Agreement, Cause shall have the equivalent meaning or the same meaning as cause or for cause set forth in any employment, consulting, or other agreement for the performance of
services between the Participant and the Company or a Related Entity or, in the absence of any such agreement or any such definition in such agreement, such term shall mean (i) the failure by the Participant to perform, in a reasonable manner,
his or her duties as assigned by the Company or a Related Entity, (ii) any violation or breach by the Participant of his or her employment, consulting or other similar agreement with the Company or a Related Entity, if any, (iii) any
violation or breach by the Participant of any
non-competition,
non-solicitation,
non-disclosure
and/or other similar agreement
with the Company or a Related Entity, (iv) any act by the Participant of dishonesty or bad faith with respect to the Company or a Related Entity, (v) use of
B-1
alcohol, drugs or other similar substances in a manner that adversely affects the Participants work performance, or (vi) the commission by the Participant of any act, misdemeanor, or
crime reflecting unfavorably upon the Participant or the Company or any Related Entity. The good faith determination by the Committee of whether the Participants Continuous Service was terminated by the Company for Cause shall be
final and binding for all purposes hereunder.
(g)
Change in Control
means a Change in Control as defined in
Section 9(b) of the Plan.
(h)
Code
means the Internal Revenue Code of 1986, as amended from time to time,
including regulations thereunder and successor provisions and regulations thereto.
(i)
Committee
means a
committee designated by the Board to administer the Plan; provided, however, that if the Board fails to designate a committee or if there are no longer any members on the committee so designated by the Board, or for any other reason determined by
the Board, then the Board shall serve as the Committee. While it is intended that the Committee shall consist of at least two directors, each of whom shall be (i) a
non-employee
director
within the meaning of Rule
16b-3
(or any successor rule) under the Exchange Act, unless administration of the Plan by
non-employee
directors is not then
required in order for exemptions under Rule
16b-3
to apply to transactions under the Plan, (ii) an outside director within the meaning of Section 162(m) of the Code, and
(iii) Independent, the failure of the Committee to be so comprised shall not invalidate any Award that otherwise satisfies the terms of the Plan.
( j)
Consultant
means any Person (other than an Employee or a Director, solely with respect to rendering services in
such Persons capacity as a director) who is engaged by the Company or any Related Entity to render consulting or advisory services to the Company or such Related Entity.
(k)
Continuous Service
means the uninterrupted provision of services to the Company or any Related Entity in any
capacity of Employee, Director, Consultant or other service provider. Continuous Service shall not be considered to be interrupted in the case of (i) any approved leave of absence, (ii) transfers among the Company, any Related Entities, or
any successor entities, in any capacity of Employee, Director, Consultant or other service provider, or (iii) any change in status as long as the individual remains in the service of the Company or a Related Entity in any capacity of Employee,
Director, Consultant or other service provider (except as otherwise provided in the Award Agreement). An approved leave of absence shall include sick leave, military leave, or any other authorized personal leave.
(l)
Covered Employee
means the Person who, as of the end of the taxable year, either is the principal executive
officer of the Company or is serving as the acting principal executive officer of the Company, and each other Person whose compensation is required to be disclosed in the Companys filings with the Securities and Exchange Commission by reason
of that person being among the three highest compensated officers of the Company as of the end of a taxable year, or such other person as shall be considered a covered employee for purposes of Section 162(m) of the Code.
(m)
Deferred Stock
means a right to receive Shares, including Restricted Stock, cash measured based upon the value
of Shares or a combination thereof, at the end of a specified deferral period.
(n)
Deferred Stock Award
means
an Award of Deferred Stock granted to a Participant under Section 6(e) hereof.
(o)
Director
means a member
of the Board or the board of directors of any Related Entity.
(p)
Disability
means a permanent and total
disability (within the meaning of Section 22(e) of the Code), as determined by a medical doctor satisfactory to the Committee.
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(q)
Dividend Equivalent
means a right, granted to a Participant under
Section 6(g) hereof, to receive cash, Shares, other Awards or other property equal in value to dividends paid with respect to a specified number of Shares, or other periodic payments.
(r)
Effective Date
means the effective date of the Plan, which shall be February 12, 2009.
(s)
Eligible Person
means each officer, Director, Employee, Consultant and other person who provides services to the
Company or any Related Entity. The foregoing notwithstanding, only Employees of the Company, or any parent corporation or subsidiary corporation of the Company (as those terms are defined in Sections 424(e) and (f) of the Code, respectively),
shall be Eligible Persons for purposes of receiving any Incentive Stock Options. An Employee on leave of absence may, in the discretion of the Committee, be considered as still in the employ of the Company or a Related Entity for purposes of
eligibility for participation in the Plan.
(t)
Employee
means any person, including an officer or Director, who
is an employee of the Company or any Related Entity. The payment of a directors fee by the Company or a Related Entity shall not be sufficient to constitute employment by the Company.
(u)
Exchange Act
means the Securities Exchange Act of 1934, as amended from time to time, including rules thereunder
and successor provisions and rules thereto.
(v)
Fair Market Value
means the fair market value of Shares, Awards
or other property as determined by the Committee, or under procedures established by the Committee. Unless otherwise determined by the Committee, the Fair Market Value of a Share as of any given date shall be (i) the last sale price of a Share
on the principal national securities exchange on which the Common Stock is traded, if the Common Stock is then traded on a national securities exchange; or (ii) the average of the closing bid and asked prices for the Common Stock quoted by an
established quotation service for
over-the-counter
securities, if the Common Stock is not then traded on a national securities exchange.
(w)
Good Reason
shall, with respect to any Participant, have the meaning specified in the Award Agreement. In the
absence of any definition in the Award Agreement, Good Reason shall have the equivalent meaning or the same meaning as good reason or for good reason set forth in any employment, consulting or other agreement for
the performance of services between the Participant and the Company or a Related Entity or, in the absence of any such agreement or any such definition in such agreement, such term shall mean (i) the assignment to the Participant of any duties
inconsistent in any material respect with the Participants duties or responsibilities as assigned by the Company or a Related Entity, or any other action by the Company or a Related Entity which results in a material diminution in such duties
or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company or a Related Entity promptly after receipt of notice thereof given by the Participant;
(ii) any material failure by the Company or a Related Entity to comply with its obligations to the Participant as agreed upon, other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the
Company or a Related Entity promptly after receipt of notice thereof given by the Participant; or (iii) the Companys or Related Entitys requiring the Participant to be based at any office or location outside of fifty miles from the
location of employment or service as of the date of Award, except for travel reasonably required in the performance of the Participants responsibilities.
(x)
Incentive Stock Option
means any Option intended to be designated as an incentive stock option within the
meaning of Section 422 of the Code or any successor provision thereto.
(y)
Independent
, when referring to
either the Board or members of the Committee, shall have the same meaning as used in the rules of the Listing Market.
(z)
Incumbent Board
means the Incumbent Board as defined in Section 9(b)(ii) hereof.
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(aa)
Listing Market
means the OTC Bulletin Board or any other national
securities exchange on which any securities of the Company are listed for trading, and if not listed for trading, by the rules of the Nasdaq Market.
(bb)
Option
means a right granted to a Participant under Section 6(b) hereof, to purchase Shares or other
Awards at a specified price during specified time periods.
(cc)
Optionee
means a person to whom an Option is
granted under this Plan or any person who succeeds to the rights of such person under this Plan.
(dd)
Other Stock-Based
Awards
means Awards granted to a Participant under Section 6(i) hereof.
(ee)
Participant
means a person who has been granted an Award under the Plan which remains outstanding, including a person who is no longer an Eligible Person.
(ff)
Performance Award
means any Award of Performance Shares or Performance Units granted pursuant to
Section 6(h) hereof.
(gg)
Performance Period
means that period established by the Committee at the time
any Performance Award is granted or at any time thereafter during which any performance goals specified by the Committee with respect to such Award are to be measured.
(hh)
Performance Share
means any grant pursuant to Section 6(h) hereof of a unit valued by reference to a
designated number of Shares, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including cash, Shares, other property, or any combination thereof, upon achievement of such performance goals
during the Performance Period as the Committee shall establish at the time of such grant or thereafter.
(ii)
Performance
Unit
means any grant pursuant to Section 6(h) hereof of a unit valued by reference to a designated amount of property (including cash) other than Shares, which value may be paid to the Participant by delivery of such property as
the Committee shall determine, including cash, Shares, other property, or any combination thereof, upon achievement of such performance goals during the Performance Period as the Committee shall establish at the time of such grant or thereafter.
(jj)
Person
shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used
in Sections 13(d) and 14(d) thereof, and shall include a group as defined in Section 13(d) thereof.
(kk)
Related Entity
means any Subsidiary, and any business, corporation, partnership, limited liability company or other entity designated by the Board, in which the Company or a Subsidiary holds a substantial ownership
interest, directly or indirectly.
(ll)
Restriction Period
means the period of time specified by the Committee
that Restricted Stock Awards shall be subject to such restrictions on transferability, risk of forfeiture and other restrictions, if any, as the Committee may impose.
(mm)
Restricted Stock
means any Share issued with the restriction that the holder may not sell, transfer, pledge or
assign such Share and with such risks of forfeiture and other restrictions as the Committee, in its sole discretion, may impose (including any restriction on the right to vote such Share and the right to receive any dividends), which restrictions
may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate.
(nn)
Restricted Stock Award
means an Award granted to a Participant under Section 6(d) hereof.
B-4
(oo)
Rule
16b-3
means Rule
16b-3,
as from time to time in effect and applicable to the Plan and Participants, promulgated by the Securities and Exchange Commission under Section 16 of the Exchange Act.
(pp)
Shares
means the shares of common stock of the Company, par value $0.001 per share, and such other securities
as may be substituted (or resubstituted) for Shares pursuant to Section 10(c) hereof.
(qq)
Stock Appreciation
Right
means a right granted to a Participant under Section 6(c) hereof.
(rr)
Subsidiary
means any corporation or other entity in which the Company has a direct or indirect ownership interest of 50% or more of the total combined voting power of the then outstanding securities or interests of such corporation or other entity entitled to
vote generally in the election of directors or in which the Company has the right to receive 50% or more of the distribution of profits or 50% or more of the assets on liquidation or dissolution.
(ss)
Substitute Awards
means Awards granted or Shares issued by the Company in assumption of, or in substitution or
exchange for, Awards previously granted, or the right or obligation to make future Awards, by a company (i) acquired by the Company or any Related Entity, (ii) which becomes a Related Entity after the date hereof, or (iii) with which
the Company or any Related Entity combines.
3.
Administration
.
(a)
Authority of the Committee
. The Plan shall be administered by the Committee except to the extent (and subject to the
limitations imposed by Section 3(b) hereof) the Board elects to administer the Plan, in which case the Plan shall be administered by only those members of the Board who are Independent members of the Board, in which case references herein to
the Committee shall be deemed to include references to the Independent members of the Board. The Committee shall have full and final authority, subject to and consistent with the provisions of the Plan, to select Eligible Persons to
become Participants, grant Awards, determine the type, number and other terms and conditions of, and all other matters relating to, Awards, prescribe Award Agreements (which need not be identical for each Participant) and rules and regulations for
the administration of the Plan, construe and interpret the Plan and Award Agreements and correct defects, supply omissions or reconcile inconsistencies therein, and to make all other decisions and determinations as the Committee may deem necessary
or advisable for the administration of the Plan. In exercising any discretion granted to the Committee under the Plan or pursuant to any Award, the Committee shall not be required to follow past practices, act in a manner consistent with past
practices, or treat any Eligible Person or Participant in a manner consistent with the treatment of any other Eligible Persons or Participants.
(b)
Manner of Exercise of Committee Authority
. The Committee, and not the Board, shall exercise sole and exclusive discretion
(i) on any matter relating to a Participant then subject to Section 16 of the Exchange Act with respect to the Company to the extent necessary in order that transactions by such Participant shall be exempt under Rule
16b-3
under the Exchange Act, (ii) with respect to any Award that is intended to qualify as performance-based compensation under Section 162(m), to the extent necessary in order for such Award
to so qualify; and (iii) with respect to any Award to an Independent Director. Any action of the Committee shall be final, conclusive and binding on all persons, including the Company, its Related Entities, Eligible Persons, Participants,
Beneficiaries, transferees under Section 10(b) hereof or other persons claiming rights from or through a Participant, and shareholders. The express grant of any specific power to the Committee, and the taking of any action by the Committee,
shall not be construed as limiting any power or authority of the Committee. The Committee may delegate to officers or managers of the Company or any Related Entity, or committees thereof, the authority, subject to such terms and limitations as the
Committee shall determine, to perform such functions, including administrative functions as the Committee may determine to the extent that such delegation will not result in the loss of an exemption under Rule
16b-3(d)(1)
for Awards granted to Participants subject to Section 16 of the Exchange Act in respect of the Company and will not cause Awards intended to qualify as performance-based
compensation under Code Section 162(m) to fail to so qualify. The Committee may appoint agents to assist it in administering the Plan.
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(c)
Limitation of Liability
. The Committee and the Board, and each member thereof,
shall be entitled to, in good faith, rely or act upon any report or other information furnished to him or her by any officer or Employee, the Companys independent auditors, Consultants or any other agents assisting in the administration of the
Plan. Members of the Committee and the Board, and any officer or Employee acting at the direction or on behalf of the Committee or the Board, shall not be personally liable for any action or determination taken or made in good faith with respect to
the Plan, and shall, to the extent permitted by law, be fully indemnified and protected by the Company with respect to any such action or determination.
4.
Shares Subject to Plan
.
(a)
Limitation on Overall Number of Shares Available for Delivery Under Plan
. Subject to adjustment as provided in
Section 10(c) hereof, the total number of Shares reserved and available for delivery under the Plan shall be 5,733,334. Any Shares delivered under the Plan may consist, in whole or in part, of authorized and unissued shares or treasury shares.
(b)
Application of Limitation to Grants of Awards
. No Award may be granted if the number of Shares to be delivered in
connection with such an Award exceeds the number of Shares remaining available for delivery under the Plan, minus the number of Shares deliverable in settlement of or relating to then outstanding Awards. The Committee may adopt reasonable counting
procedures to ensure appropriate counting, avoid double counting (as, for example, in the case of tandem or substitute awards) and make adjustments if the number of Shares actually delivered differs from the number of Shares previously counted in
connection with an Award.
(c)
Availability of Shares Not Delivered under Awards and Adjustments to Limits
.
(i) If any Awards are forfeited, expire or otherwise terminate without issuance of such Shares, or any Award is settled for cash or otherwise
does not result in the issuance of all or a portion of the Shares subject to such Award, the Shares to which those Awards were subject, shall, to the extent of such forfeiture, expiration, termination, cash settlement or
non-issuance,
again be available for delivery with respect to Awards under the Plan, subject to Section 4(c)(iv) below.
(ii) In the event that any Option or other Award granted hereunder is exercised through the tendering of Shares (either actually or by
attestation) or by the withholding of Shares by the Company, or withholding tax liabilities arising from such option or other award are satisfied by the tendering of Shares (either actually or by attestation) or by the withholding of Shares by the
Company, then only the number of Shares issued net of the Shares tendered or withheld shall be counted for purposes of determining the maximum number of Shares available for grant under the Plan.
(iii) Substitute Awards shall not reduce the Shares authorized for delivery under the Plan or authorized for delivery to a Participant in any
period. Additionally, in the event that a company acquired by the Company or any Related Entity or with which the Company or any Related Entity combines has shares available under a
pre-existing
plan approved
by its shareholders, the shares available for delivery pursuant to the terms of such
pre-existing
plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio
or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the Shares
authorized for delivery under the Plan; if and to the extent that the use of such Shares would not require approval of the Companys shareholders under the rules of the Listing Market.
(iv) Any Share that again becomes available for delivery pursuant to this Section 4(c) shall be added back as one (1) Share.
(v) Notwithstanding anything in this Section 4(c) to the contrary but subject to adjustment as provided in Section 10(c) hereof,
the maximum aggregate number of Shares that may be delivered under the Plan as a result of the exercise of the Incentive Stock Options shall be 5,533,334 Shares.
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5.
Eligibility;
Per-Person
Award
Limitations
. Awards may be granted under the Plan only to Eligible Persons. Subject to adjustment as provided in Section 10(c), in any fiscal year of the Company during any part of which the Plan is in effect, no Participant may be
granted (i) Options or Stock Appreciation Rights with respect to more than 2,000,000 Shares or (ii) Restricted Stock, Deferred Stock, Performance Shares and/or Other Stock-Based Awards with respect to more than 2,000,000 Shares. In
addition, the maximum dollar value payable to any one Participant with respect to Performance Units is (x) $1,000,000 with respect to any 12 month Performance Period and (y) with respect to any Performance Period that is more than 12
months, $3,000,000.
6.
Specific Terms of Awards
.
(a)
General
. Awards may be granted on the terms and conditions set forth in this Section 6. In addition, the Committee may
impose on any Award or the exercise thereof, at the date of grant or thereafter (subject to Section 10(e)), such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine, including
terms requiring forfeiture of Awards in the event of termination of the Participants Continuous Service and terms permitting a Participant to make elections relating to his or her Award. Except as otherwise expressly provided herein, the
Committee shall retain full power and discretion to accelerate, waive or modify, at any time, any term or condition of an Award that is not mandatory under the Plan. Except in cases in which the Committee is authorized to require other forms of
consideration under the Plan, or to the extent other forms of consideration must be paid to satisfy the requirements of Massachusetts law, no consideration other than services may be required for the grant (as opposed to the exercise) of any Award.
(b)
Options
. The Committee is authorized to grant Options to any Eligible Person on the following terms and conditions:
(i)
Exercise Price
. Other than in connection with Substitute Awards, the exercise price per Share purchasable under an
Option shall be determined by the Committee, provided that such exercise price shall not be less than 100% of the Fair Market Value of a Share on the date of grant of the Option and shall not, in any event, be less than the par value of a Share on
the date of grant of the Option. If an Employee owns or is deemed to own (by reason of the attribution rules applicable under Section 424(d) of the Code) more than 10% of the combined voting power of all classes of stock of the Company (or any
parent corporation or subsidiary corporation of the Company, as those terms are defined in Sections 424(e) and (f) of the Code, respectively) and an Incentive Stock Option is granted to such Employee, the exercise price of such Incentive Stock
Option (to the extent required by the Code at the time of grant) shall be no less than 110% of the Fair Market Value of a Share on the date such Incentive Stock Option is granted.
(ii)
Time and Method of Exercise
. The Committee shall determine the time or times at which or the circumstances under which an
Option may be exercised in whole or in part (including based on achievement of performance goals and/or future service requirements), the time or times at which Options shall cease to be or become exercisable following termination of Continuous
Service or upon other conditions, the methods by which the exercise price may be paid or deemed to be paid (including in the discretion of the Committee a cashless exercise procedure), the form of such payment, including, without limitation, cash,
Shares (including without limitation the withholding of Shares otherwise deliverable pursuant to the Award), other Awards or awards granted under other plans of the Company or a Related Entity, or other property (including notes or other contractual
obligations of Participants to make payment on a deferred basis provided that such deferred payments are not in violation of Section 13(k) of the Exchange Act, or any rule or regulation adopted thereunder or any other applicable law), and the
methods by or forms in which Shares will be delivered or deemed to be delivered to Participants.
(iii)
Incentive Stock
Options
. The terms of any Incentive Stock Option granted under the Plan shall comply in all respects with the provisions of Section 422 of the Code. Anything in the Plan to the contrary notwithstanding, no term of the Plan relating to
Incentive Stock Options (including any Stock Appreciation Right issued in tandem therewith) shall be interpreted, amended or altered, nor shall any discretion or authority granted
B-7
under the Plan be exercised, so as to disqualify either the Plan or any Incentive Stock Option under Section 422 of the Code, unless the Participant has first requested, or consents to, the
change that will result in such disqualification. Thus, if and to the extent required to comply with Section 422 of the Code, Options granted as Incentive Stock Options shall be subject to the following special terms and conditions:
(A) the Option shall not be exercisable for more than ten years after the date such Incentive Stock Option is granted; provided, however, that
if a Participant owns or is deemed to own (by reason of the attribution rules of Section 424(d) of the Code) more than 10% of the combined voting power of all classes of stock of the Company (or any parent corporation or subsidiary corporation
of the Company, as those terms are defined in Sections 424(e) and (f) of the Code, respectively) and the Incentive Stock Option is granted to such Participant, the term of the Incentive Stock Option shall be (to the extent required by the Code
at the time of the grant) for no more than five years from the date of grant; and
(B) The aggregate Fair Market Value (determined as of
the date the Incentive Stock Option is granted) of the Shares with respect to which Incentive Stock Options granted under the Plan and all other option plans of the Company (and any parent corporation or subsidiary corporation of the Company, as
those terms are defined in Sections 424(e) and (f) of the Code, respectively) that become exercisable for the first time by the Participant during any calendar year shall not (to the extent required by the Code at the time of the grant) exceed
$100,000.
(c)
Stock Appreciation Rights
. The Committee may grant Stock Appreciation Rights to any Eligible Person in
conjunction with all or part of any Option granted under the Plan or at any subsequent time during the term of such Option (a Tandem Stock Appreciation Right), or without regard to any Option (a Freestanding Stock Appreciation
Right), in each case upon such terms and conditions as the Committee may establish in its sole discretion, not inconsistent with the provisions of the Plan, including the following:
(i)
Right to Payment
. A Stock Appreciation Right shall confer on the Participant to whom it is granted a right to receive, upon
exercise thereof, the excess of (A) the Fair Market Value of one Share on the date of exercise over (B) the grant price of the Stock Appreciation Right as determined by the Committee. The grant price of a Stock Appreciation Right shall not
be less than 100% of the Fair Market Value of a Share on the date of grant, in the case of a Freestanding Stock Appreciation Right, or less than the associated Option exercise price, in the case of a Tandem Stock Appreciation Right.
(ii)
Other Terms
. The Committee shall determine at the date of grant or thereafter, the time or times at which and the
circumstances under which a Stock Appreciation Right may be exercised in whole or in part (including based on achievement of performance goals and/or future service requirements), the time or times at which Stock Appreciation Rights shall cease to
be or become exercisable following termination of Continuous Service or upon other conditions, the method of exercise, method of settlement, form of consideration payable in settlement, method by or forms in which Shares will be delivered or deemed
to be delivered to Participants, whether or not a Stock Appreciation Right shall be in tandem or in combination with any other Award, and any other terms and conditions of any Stock Appreciation Right.
(iii)
Tandem Stock Appreciation Rights
. Any Tandem Stock Appreciation Right may be granted at the same time as the related
Option is granted or, for Options that are not Incentive Stock Options, at any time thereafter before exercise or expiration of such Option. Any Tandem Stock Appreciation Right related to an Option may be exercised only when the related Option would
be exercisable and the Fair Market Value of the Shares subject to the related Option exceeds the exercise price at which Shares can be acquired pursuant to the Option. In addition, if a Tandem Stock Appreciation Right exists with respect to less
than the full number of Shares covered by a related Option, then an exercise or termination of such Option shall not reduce the number of Shares to which the Tandem Stock Appreciation Right applies until the number of Shares then exercisable under
such Option equals the number of Shares to which the Tandem Stock Appreciation Right applies. Any Option related to a Tandem Stock Appreciation Right shall no longer be exercisable to the extent the Tandem Stock Appreciation Right has been
exercised, and any Tandem Stock Appreciation Right shall no longer be exercisable to the extent the related Option has been exercised.
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(d)
Restricted Stock Awards
. The Committee is authorized to grant Restricted Stock
Awards to any Eligible Person on the following terms and conditions:
(i)
Grant and Restrictions
. Restricted Stock Awards
shall be subject to such restrictions on transferability, risk of forfeiture and other restrictions, if any, as the Committee may impose, or as otherwise provided in this Plan during the Restriction Period. The terms of any Restricted Stock Award
granted under the Plan shall be set forth in a written Award Agreement which shall contain provisions determined by the Committee and not inconsistent with the Plan. The restrictions may lapse separately or in combination at such times, under such
circumstances (including based on achievement of performance goals and/or future service requirements), in such installments or otherwise, as the Committee may determine at the date of grant or thereafter. Except to the extent restricted under the
terms of the Plan and any Award Agreement relating to a Restricted Stock Award, a Participant granted Restricted Stock shall have all of the rights of a shareholder, including the right to vote the Restricted Stock and the right to receive dividends
thereon (subject to any mandatory reinvestment or other requirement imposed by the Committee). During the period that the Restriction Stock Award is subject to a risk of forfeiture, subject to Section 10(b) below and except as otherwise
provided in the Award Agreement, the Restricted Stock may not be sold, transferred, pledged, hypothecated, margined or otherwise encumbered by the Participant.
(ii)
Forfeiture
. Except as otherwise determined by the Committee, upon termination of a Participants Continuous Service
during the applicable Restriction Period, the Participants Restricted Stock that is at that time subject to a risk of forfeiture that has not lapsed or otherwise been satisfied shall be forfeited and reacquired by the Company; provided that,
subject to the limitations set forth in Section 6(j)(ii) hereof, the Committee may provide, by rule or regulation or in any Award Agreement, or may determine in any individual case, that forfeiture conditions relating to Restricted Stock Awards
shall be waived in whole or in part in the event of terminations resulting from specified causes, and the Committee may in other cases waive in whole or in part the forfeiture of Restricted Stock.
(iii)
Certificates for Stock
. Restricted Stock granted under the Plan may be evidenced in such manner as the Committee shall
determine. If certificates representing Restricted Stock are registered in the name of the Participant, the Committee may require that such certificates bear an appropriate legend referring to the terms, conditions and restrictions applicable to
such Restricted Stock, that the Company retain physical possession of the certificates, and that the Participant deliver a stock power to the Company, endorsed in blank, relating to the Restricted Stock.
(iv)
Dividends and Splits
. As a condition to the grant of a Restricted Stock Award, the Committee may require or permit a
Participant to elect that any cash dividends paid on a Share of Restricted Stock be automatically reinvested in additional Shares of Restricted Stock or applied to the purchase of additional Awards under the Plan. Unless otherwise determined by the
Committee, Shares distributed in connection with a stock split or stock dividend, and other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to
which such Shares or other property have been distributed.
(e)
Deferred Stock Award
. The Committee is authorized to grant
Deferred Stock Awards to any Eligible Person on the following terms and conditions:
(i)
Award and Restrictions
.
Satisfaction of a Deferred Stock Award shall occur upon expiration of the deferral period specified for such Deferred Stock Award by the Committee (or, if permitted by the Committee, as elected by the Participant). In addition, a Deferred Stock
Award shall be subject to such restrictions (which may include a risk of forfeiture) as the Committee may impose, if any, which restrictions may lapse at the expiration of the deferral period or at earlier specified times (including based on
achievement of performance goals and/or future service requirements), separately or in combination, in installments or otherwise, as the Committee may determine. A Deferred Stock Award may be satisfied by delivery of Shares, cash equal to
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the Fair Market Value of the specified number of Shares covered by the Deferred Stock, or a combination thereof, as determined by the Committee at the date of grant or thereafter. Prior to
satisfaction of a Deferred Stock Award, a Deferred Stock Award carries no voting or dividend or other rights associated with Share ownership.
(ii)
Forfeiture
. Except as otherwise determined by the Committee, upon termination of a Participants Continuous Service
during the applicable deferral period or portion thereof to which forfeiture conditions apply (as provided in the Award Agreement evidencing the Deferred Stock Award), the Participants Deferred Stock Award that is at that time subject to a
risk of forfeiture that has not lapsed or otherwise been satisfied shall be forfeited; provided that, subject to the limitations set forth in Section 6(j)(ii) hereof, the Committee may provide, by rule or regulation or in any Award Agreement,
or may determine in any individual case, that forfeiture conditions relating to a Deferred Stock Award shall be waived in whole or in part in the event of terminations resulting from specified causes, and the Committee may in other cases waive in
whole or in part the forfeiture of any Deferred Stock Award.
(iii)
Dividend Equivalents
. Unless otherwise determined by
the Committee at the date of grant, any Dividend Equivalents that are granted with respect to any Deferred Stock Award shall be either (A) paid with respect to such Deferred Stock Award at the dividend payment date in cash or in Shares of
unrestricted stock having a Fair Market Value equal to the amount of such dividends, or (B) deferred with respect to such Deferred Stock Award and the amount or value thereof automatically deemed reinvested in additional Deferred Stock, other
Awards or other investment vehicles, as the Committee shall determine or permit the Participant to elect. The applicable Award Agreement shall specify whether any Dividend Equivalents shall be paid at the dividend payment date, deferred or deferred
at the election of the Participant. If the Participant may elect to defer the Dividend Equivalents, such election shall be made within 30 days after the grant date of the Deferred Stock Award, but in no event later than 12 months before the first
date on which any portion of such Deferred Stock Award vests.
(f)
Bonus Stock and Awards in Lieu of Obligations
. The
Committee is authorized to grant Shares to any Eligible Persons as a bonus, or to grant Shares or other Awards in lieu of obligations to pay cash or deliver other property under the Plan or under other plans or compensatory arrangements, provided
that, in the case of Eligible Persons subject to Section 16 of the Exchange Act, the amount of such grants remains within the discretion of the Committee to the extent necessary to ensure that acquisitions of Shares or other Awards are exempt
from liability under Section 16(b) of the Exchange Act. Shares or Awards granted hereunder shall be subject to such other terms as shall be determined by the Committee.
(g)
Dividend Equivalents
. The Committee is authorized to grant Dividend Equivalents to any Eligible Person entitling the
Eligible Person to receive cash, Shares, other Awards, or other property equal in value to the dividends paid with respect to a specified number of Shares, or other periodic payments. Dividend Equivalents may be awarded on a free-standing basis or
in connection with another Award. The Committee may provide that Dividend Equivalents shall be paid or distributed when accrued or shall be deemed to have been reinvested in additional Shares, Awards, or other investment vehicles, and subject to
such restrictions on transferability and risks of forfeiture, as the Committee may specify. Any such determination by the Committee shall be made at the grant date of the applicable Award.
(h)
Performance Awards
. The Committee is authorized to grant Performance Awards to any Eligible Person payable in cash, Shares,
or other Awards, on terms and conditions established by the Committee, subject to the provisions of Section 8 if and to the extent that the Committee shall, in its sole discretion, determine that an Award shall be subject to those provisions.
The performance criteria to be achieved during any Performance Period and the length of the Performance Period shall be determined by the Committee upon the grant of each Performance Award; provided, however, that a Performance Period shall not be
shorter than 12 months nor longer than 5 years. Except as provided in Section 9 or as may be provided in an Award Agreement, Performance Awards will be distributed only after the end of the relevant Performance Period. The performance goals to
be
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achieved for each Performance Period shall be conclusively determined by the Committee and may be based upon the criteria set forth in Section 8(b), or in the case of an Award that the
Committee determines shall not be subject to Section 8 hereof, any other criteria that the Committee, in its sole discretion, shall determine should be used for that purpose. The amount of the Award to be distributed shall be conclusively
determined by the Committee. Performance Awards may be paid in a lump sum or in installments following the close of the Performance Period or, in accordance with procedures established by the Committee, on a deferred basis.
(i)
Other Stock-Based Awards
. The Committee is authorized, subject to limitations under applicable law, to grant to any Eligible
Person such other Awards that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Shares, as deemed by the Committee to be consistent with the purposes of the Plan. Other Stock-Based
Awards may be granted to Participants either alone or in addition to other Awards granted under the Plan, and such Other Stock-Based Awards shall also be available as a form of payment in the settlement of other Awards granted under the Plan. The
Committee shall determine the terms and conditions of such Awards. Shares delivered pursuant to an Award in the nature of a purchase right granted under this Section 6(i) shall be purchased for such consideration, (including without limitation
loans from the Company or a Related Entity provided that such loans are not in violation of Section 13(k) of the Exchange Act, or any rule or regulation adopted thereunder or any other applicable law) paid for at such times, by such methods,
and in such forms, including, without limitation, cash, Shares, other Awards or other property, as the Committee shall determine.
7.
Certain Provisions Applicable to Awards
.
(a)
Stand-Alone, Additional, Tandem, and Substitute Awards
. Awards
granted under the Plan may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with, or in substitution or exchange for, any other Award or any award granted under another plan of the Company, any Related
Entity, or any business entity to be acquired by the Company or a Related Entity, or any other right of a Participant to receive payment from the Company or any Related Entity. Such additional, tandem, and substitute or exchange Awards may be
granted at any time. If an Award is granted in substitution or exchange for another Award or award, the Committee shall require the surrender of such other Award or award in consideration for the grant of the new Award. In addition, Awards may be
granted in lieu of cash compensation, including in lieu of cash amounts payable under other plans of the Company or any Related Entity, in which the value of Shares subject to the Award is equivalent in value to the cash compensation (for example,
Deferred Stock or Restricted Stock), or in which the exercise price, grant price or purchase price of the Award in the nature of a right that may be exercised is equal to the Fair Market Value of the underlying Shares minus the value of the cash
compensation surrendered (for example, Options or Stock Appreciation Right granted with an exercise price or grant price discounted by the amount of the cash compensation surrendered), provided that any such determination to grant an
Award in lieu of cash compensation must be made in compliance with Section 409A of the Code.
(b)
Term of Awards
. The
term of each Award shall be for such period as may be determined by the Committee; provided that in no event shall the term of any Option or Stock Appreciation Right exceed a period of ten years (or in the case of an Incentive Stock Option such
shorter term as may be required under Section 422 of the Code).
(c)
Form and Timing of Payment Under Awards;
Deferrals
. Subject to the terms of the Plan and any applicable Award Agreement, payments to be made by the Company or a Related Entity upon the exercise of an Option or other Award or settlement of an Award may be made in such forms as the
Committee shall determine, including, without limitation, cash, Shares, other Awards or other property, and may be made in a single payment or transfer, in installments, or on a deferred basis, provided that any determination to pay in installments
or on a deferred basis shall be made by the Committee at the date of grant. Any installment or deferral provided for in the preceding sentence shall, however, be subject to the Companys compliance with applicable law and all applicable rules
of the Listing Market, and in a manner intended to be exempt from or otherwise satisfy the requirements of Section 409A of the Code. Subject to Section 7(e) hereof, the settlement of any Award may be
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accelerated, and cash paid in lieu of Shares in connection with such settlement, in the sole discretion of the Committee or upon occurrence of one or more specified events (in addition to a
Change in Control). Any such settlement shall be at a value determined by the Committee in its sole discretion, which, without limitation, may in the case of an Option or Stock Appreciation Right be limited to the amount if any by which the Fair
Market Value of a Share on the settlement date exceeds the exercise or grant price. Installment or deferred payments may be required by the Committee (subject to Section 7(e) of the Plan, including the consent provisions thereof in the case of
any deferral of an outstanding Award not provided for in the original Award Agreement) or permitted at the election of the Participant on terms and conditions established by the Committee. The Committee may, without limitation, make provision for
the payment or crediting of a reasonable interest rate on installment or deferred payments or the grant or crediting of Dividend Equivalents or other amounts in respect of installment or deferred payments denominated in Shares.
(d)
Exemptions from Section
16(b) Liability
. : If the It is the intent of the Company that the
grant of any Awards to or other transaction by a Participant who is subject to Section 16 of the Exchange Act shall be exempt from Section 16 pursuant to an applicable exemption (except for transactions acknowledged in writing to be
non-exempt
by such Participant). Accordingly, if any provision of this Plan or any Award Agreement does not comply with the requirements of Rule
16b-3
then applicable to any
such transaction, such provision shall be construed or deemed amended to the extent necessary to conform to the applicable requirements of Rule
16b-3
so that such Participant shall avoid liability under
Section 16(b).
(e)
Code Section
409A
.
(i) The Award Agreement for any Award that the Committee reasonably determines to constitute a Section 409A Plan, and the provisions of
the Plan applicable to that Award, shall be construed in a manner consistent with the applicable requirements of Section 409A, and the Committee, in its sole discretion and without the consent of any Participant, may amend any Award Agreement
(and the provisions of the Plan applicable thereto) if and to the extent that the Committee determines that such amendment is necessary or appropriate to comply with the requirements of Section 409A of the Code.
(ii) If any Award constitutes a nonqualified deferred compensation plan under Section 409A of the Code (a
Section 409A Plan), then the Award shall be subject to the following additional requirements, if and to the extent required to comply with Section 409A of the Code:
(A) Payments under the Section 409A Plan may not be made earlier than the first to occur of (u) the Participants
separation from service, (v) the date the Participant becomes disabled, (w) the Participants death, (x) a specified time (or pursuant to a fixed schedule) specified in the Award Agreement at
the date of the deferral of such compensation, (y) a change in the ownership or effective control of the corporation, or in the ownership of a substantial portion of the assets of the Company, or (z) the occurrence of an
unforeseeble emergency;
(B) The time or schedule for any payment of the deferred compensation may not be accelerated, except
to the extent provided in applicable Treasury Regulations or other applicable guidance issued by the Internal Revenue Service;
(C) Any
elections with respect to the deferral of such compensation or the time and form of distribution of such deferred compensation shall comply with the requirements of Section 409A(a)(4) of the Code; and
(D) In the case of any Participant who is specified employee, a distribution on account of a separation from service
may not be made before the date which is six months after the date of the Participants separation from service (or, if earlier, the date of the Participants death).
For purposes of the foregoing, the terms in quotations shall have the same meanings as those terms have for purposes of Section 409A of
the Code, and the limitations set forth herein shall be applied in such manner (and
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only to the extent) as shall be necessary to comply with any requirements of Section 409A of the Code that are applicable to the Award. The Company does not make any representation to the
Participant that any Awards awarded under this Plan will be exempt from, or satisfy, the requirements of Section 409A, and the Company shall have no liability or other obligation to indemnify or hold harmless any Participant or Beneficiary for
any tax, additional tax, interest or penalties that any Participant or Beneficiary may incur in the event that any provision of this Plan, any Award Agreement, or any amendment or modification thereof, or any other action taken with respect thereto,
is deemed to violate any of the requirements of Section 409A.
(iii) Notwithstanding the foregoing, the Company does not make any
representation to any Participant or Beneficiary that any Awards made pursuant to this Plan are exempt from, or satisfy, the requirements of Section 409A, and the Company shall have no liability or other obligation to indemnify or hold harmless
the Participant or any Beneficiary for any tax, additional tax, interest or penalties that the Participant or any Beneficiary may incur in the event that any provision of this Plan, or any Award Agreement, or any amendment or modification thereof,
or any other action taken with respect thereto, is deemed to violate any of the requirements of Section 409A.
8.
Code
Section
162(m) Provisions
.
(a)
Covered Employees
. Unless otherwise specified by
the Committee,] the provisions of this Section 8 shall be applicable to any Performance Award granted to an Eligible Person who is, or is likely to be, as of the end of the tax year in which the Company would claim a tax deduction in connection
with such Award, a Covered Employee.
(b)
Performance Criteria
. If a Performance Award is subject to this Section 8,
then the payment or distribution thereof or the lapsing of restrictions thereon and the distribution of cash, Shares or other property pursuant thereto, as applicable, shall be contingent upon achievement of one or more objective performance goals.
Performance goals shall be objective and shall otherwise meet the requirements of Section 162(m) of the Code and regulations thereunder including the requirement that the level or levels of performance targeted by the Committee result in the
achievement of performance goals being substantially uncertain. One or more of the following business criteria for the Company, on a consolidated basis, and/or for Related Entities, or for business or geographical units of the Company
and/or a Related Entity (except with respect to the total shareholder return and earnings per share criteria), shall be used by the Committee in establishing performance goals for such Awards: (1) earnings per share; (2) revenues or
margins; (3) cash flow; (4) operating margin; (5) return on net assets, investment, capital, or equity; (6) economic value added; (7) direct contribution; (8) net income; pretax earnings; earnings before interest and
taxes; earnings before interest, taxes, depreciation and amortization; earnings after interest expense and before extraordinary or special items; operating income or income from operations; income before interest income or expense, unusual items and
income taxes, local, state or federal and excluding budgeted and actual bonuses which might be paid under any ongoing bonus plans of the Company; (9) working capital; (10) management of fixed costs or variable costs;
(11) identification or consummation of investment opportunities or completion of specified projects in accordance with corporate business plans, including strategic mergers, acquisitions or divestitures; (12) total shareholder return;
(13) debt reduction; (14) market share; (15) entry into new markets, either geographically or by business unit; (16) customer retention and satisfaction; (17) strategic plan development and implementation, including
turnaround plans; and/or (18) the Fair Market Value of a Share. Any of the above goals may be determined on an absolute or relative basis or as compared to the performance of a published or special index deemed applicable by the Committee
including, but not limited to, the Standard & Poors 500 Stock Index or a group of companies that are comparable to the Company. In determining the achievement of the performance goals, the Committee shall exclude the impact of any
(i) restructurings, discontinued operations, extraordinary items, and other unusual or
non-recurring
charges, (ii) event either not directly related to the operations of the Company or not within the
reasonable control of the Companys management, or (iii) change in accounting standards required by generally accepted accounting principles.
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(c)
Performance Period; Timing For Establishing Performance Goals
. Achievement of
performance goals in respect of Performance Awards shall be measured over a Performance Period no shorter than 12 months and no longer than 5 years, as specified by the Committee. Performance goals shall be established not later than 90 days after
the beginning of any Performance Period applicable to such Performance Awards, or at such other date as may be required or permitted for performance-based compensation under Section 162(m) of the Code.
(d)
Adjustments
. The Committee may, in its discretion, reduce the amount of a settlement otherwise to be made in connection with
Awards subject to this Section 8, but may not exercise discretion to increase any such amount payable to a Covered Employee in respect of an Award subject to this Section 8. The Committee shall specify the circumstances in which such
Awards shall be paid or forfeited in the event of termination of Continuous Service by the Participant prior to the end of a Performance Period or settlement of Awards.
(e)
Committee Certification
. No Participant shall receive any payment under the Plan that is subject to this Section 8
unless the Committee has certified, by resolution or other appropriate action in writing, that the performance criteria and any other material terms previously established by the Committee or set forth in the Plan, have been satisfied to the extent
necessary to qualify as performance based compensation under Section 162(m) of the Code.
9.
Change in
Control
.
(a)
Effect of Change in Control.
If and only to the extent provided in any employment or other
agreement between the Participant and the Company or any Related Entity, or in any Award Agreement, or to the extent otherwise determined by the Committee in its sole discretion and without any requirement that each Participant be treated
consistently, upon the occurrence of a Change in Control, as defined in Section 9(b):
(i) Any Option or Stock
Appreciation Right that was not previously vested and exercisable as of the time of the Change in Control, shall become immediately vested and exercisable, subject to applicable restrictions set forth in Section 10(a) hereof.
(ii) Any restrictions, deferral of settlement, and forfeiture conditions applicable to a Restricted Stock Award, Deferred Stock Award or an
Other Stock-Based Award subject only to future service requirements granted under the Plan shall lapse and such Awards shall be deemed fully vested as of the time of the Change in Control, except to the extent of any waiver by the Participant and
subject to applicable restrictions set forth in Section 10(a) hereof.
(iii) With respect to any outstanding Award subject to
achievement of performance goals and conditions under the Plan, the Committee may, in its discretion, deem such performance goals and conditions as having been met as of the date of the Change in Control.
(b)
Definition of Change in Control
. Unless otherwise specified in any employment agreement between the Participant
and the Company or any Related Entity, or in an Award Agreement, a Change in Control shall mean the occurrence of any of the following:
(i) The acquisition by any Person of Beneficial Ownership (within the meaning of Rule
13d-3
promulgated under the Exchange Act) of more than fifty percent (50%) of either (A) the value of then outstanding equity securities of the Company (the Outstanding Company Stock) or (B) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the election of directors (the Outstanding Company Voting Securities) (the foregoing Beneficial Ownership hereinafter being referred to as a Controlling
Interest); provided, however, that for purposes of this Section 9(b), the following acquisitions shall not constitute or result in a Change in Control: (v) any acquisition directly from the Company; (w) any acquisition by the
Company; (x) any acquisition by any Person that as of the Effective Date owns Beneficial Ownership of a Controlling Interest; (y) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any
Related Entity; or (z) any acquisition by any entity pursuant to a transaction which complies with clauses (A), (B) and (C) of subsection (iii) below; or
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(ii) During any period of three (3) consecutive years (not including any period prior to
the Effective Date) individuals who constitute the Board on the Effective Date (the Incumbent Board) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director
subsequent to the Effective Date whose election, or nomination for election by the Companys shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or
(iii)
Consummation of a reorganization, merger, statutory share exchange or consolidation or similar transaction involving the Company or any of its Related Entities, a sale or other disposition of all or substantially all of the assets of the Company, or
the acquisition of assets or equity of another entity by the Company or any of its Related Entities (each a Business Combination), in each case, unless, following such Business Combination, (A) all or substantially all of the
individuals and entities who were the Beneficial Owners, respectively, of the Outstanding Company Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than
fifty percent (50%) of the value of the then outstanding equity securities and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of members of the board of directors (or comparable
governing body of an entity that does not have such a board), as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity which as a result of such transaction owns the Company or all or
substantially all of the Companys assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the Outstanding Company Stock and
Outstanding Company Voting Securities, as the case may be, (B) no Person (excluding any employee benefit plan (or related trust) of the Company or such entity resulting from such Business Combination or any Person that as of the Effective Date
owns Beneficial Ownership of a Controlling Interest) beneficially owns, directly or indirectly, fifty percent (50%) or more of the value of the then outstanding equity securities of the entity resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such entity except to the extent that such ownership existed prior to the Business Combination and (C) at least a majority of the members of the Board of Directors or other
governing body of the entity resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or
(iv) Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company.
10.
General Provisions
.
(a) Compliance With Legal and Other Requirements. The Company may, to the extent deemed necessary or advisable by the Committee, postpone the
issuance or delivery of Shares or payment of other benefits under any Award until completion of such registration or qualification of such Shares or other required action under any federal or state law, rule or regulation, listing or other required
action with respect to the Listing Market, or compliance with any other obligation of the Company, as the Committee, may consider appropriate, and may require any Participant to make such representations, furnish such information and comply with or
be subject to such other conditions as it may consider appropriate in connection with the issuance or delivery of Shares or payment of other benefits in compliance with applicable laws, rules, and regulations, listing requirements, or other
obligations.
(b)
Limits on Transferability; Beneficiaries
. No Award or other right or interest granted under the Plan shall
be pledged, hypothecated or otherwise encumbered or subject to any lien, obligation or liability of such Participant to any party, or assigned or transferred by such Participant otherwise than by will or the laws of
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descent and distribution or to a Beneficiary upon the death of a Participant, and such Awards or rights that may be exercisable shall be exercised during the lifetime of the Participant only by
the Participant or his or her guardian or legal representative, except that Awards and other rights (other than Incentive Stock Options and Stock Appreciation Rights in tandem therewith) may be transferred to one or more Beneficiaries or other
transferees during the lifetime of the Participant, and may be exercised by such transferees in accordance with the terms of such Award, but only if and to the extent such transfers are permitted by the Committee pursuant to the express terms of an
Award Agreement (subject to any terms and conditions which the Committee may impose thereon). A Beneficiary, transferee, or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions
of the Plan and any Award Agreement applicable to such Participant, except as otherwise determined by the Committee, and to any additional terms and conditions deemed necessary or appropriate by the Committee.
(c)
Adjustments
.
(i)
Adjustments to Awards
. In the event that any extraordinary dividend or other distribution (whether in the form of cash,
Shares, or other property), recapitalization, forward or reverse split, reorganization, merger, consolidation,
spin-off,
combination, repurchase, share exchange, liquidation, dissolution or other similar
corporate transaction or event affects the Shares and/or such other securities of the Company or any other issuer such that a substitution, exchange, or adjustment is determined by the Committee to be appropriate, then the Committee shall, in such
manner as it may deem equitable, substitute, exchange or adjust any or all of (A) the number and kind of Shares which may be delivered in connection with Awards granted thereafter, (B) the number and kind of Shares by which annual
per-person
Award limitations are measured under Section 4 hereof, (C) the number and kind of Shares subject to or deliverable in respect of outstanding Awards, (D) the exercise price, grant price or
purchase price relating to any Award and/or make provision for payment of cash or other property in respect of any outstanding Award, and (E) any other aspect of any Award that the Committee determines to be appropriate.
(ii)
Adjustments in Case of Certain Transactions
. In the event of any merger, consolidation or other reorganization in which
the Company does not survive, or in the event of any Change in Control, any outstanding Awards may be dealt with in accordance with any of the following approaches, without the requirement of obtaining any consent or agreement of a Participant as
such, as determined by the agreement effectuating the transaction or, if and to the extent not so determined, as determined by the Committee: (a) the continuation of the outstanding Awards by the Company, if the Company is a surviving entity,
(b) the assumption or substitution for, as those terms are defined in Section 9(a)(iv) hereof, the outstanding Awards by the surviving entity or its parent or subsidiary, (c) full exercisability or vesting and accelerated expiration
of the outstanding Awards, or (d) settlement of the value of the outstanding Awards in cash or cash equivalents or other property followed by cancellation of such Awards (which value, in the case of Options or Stock Appreciation Rights, shall
be measured by the amount, if any, by which the Fair Market Value of a Share exceeds the exercise or grant price of the Option or Stock Appreciation Right as of the effective date of the transaction). The Committee shall give written notice of any
proposed transaction referred to in this Section 10(c)(ii) at a reasonable period of time prior to the closing date for such transaction (which notice may be given either before or after the approval of such transaction), in order that
Participants may have a reasonable period of time prior to the closing date of such transaction within which to exercise any Awards that are then exercisable (including any Awards that may become exercisable upon the closing date of such
transaction). A Participant may condition his exercise of any Awards upon the consummation of the transaction.
(iii)
Other
Adjustments
. The Committee (and the Board if and only to the extent such authority is not required to be exercised by the Committee to comply with Section 162(m) of the Code) is authorized to make adjustments in the terms and conditions
of, and the criteria included in, Awards (including Performance Awards, or performance goals and conditions relating thereto) in recognition of unusual or nonrecurring events (including, without limitation, acquisitions and dispositions of
businesses and assets) affecting the Company, any Related Entity or any business unit, or the financial statements of the Company or any Related Entity, or in response to
B-16
changes in applicable laws, regulations, accounting principles, tax rates and regulations or business conditions or in view of the Committees assessment of the business strategy of the
Company, any Related Entity or business unit thereof, performance of comparable organizations, economic and business conditions, personal performance of a Participant, and any other circumstances deemed relevant; provided that no such adjustment
shall be authorized or made if and to the extent that such authority or the making of such adjustment would cause Options, Stock Appreciation Rights, Performance Awards granted pursuant to Section 8(b) hereof to Participants designated by the
Committee as Covered Employees and intended to qualify as performance-based compensation under Code Section 162(m) and the regulations thereunder to otherwise fail to qualify as performance-based compensation under Code
Section 162(m) and regulations thereunder. Adjustments permitted hereby may include, without limitation, increasing the exercise price of Options and Stock Appreciation Rights, increasing performance goals, or other adjustments that may be
adverse to the Participant.
(d)
Taxes
. The Company and any Related Entity are authorized to withhold from any Award
granted, any payment relating to an Award under the Plan, including from a distribution of Shares, or any payroll or other payment to a Participant, amounts of withholding and other taxes due or potentially payable in connection with any transaction
involving an Award, and to take such other action as the Committee may deem advisable to enable the Company or any Related Entity and Participants to satisfy obligations for the payment of withholding taxes and other tax obligations relating to any
Award. This authority shall include authority to withhold or receive Shares or other property and to make cash payments in respect thereof in satisfaction of a Participants tax obligations, either on a mandatory or elective basis in the
discretion of the Committee.
(e)
Changes to the Plan and Awards
. The Board may amend, alter, suspend, discontinue or
terminate the Plan, or the Committees authority to grant Awards under the Plan, without the consent of shareholders or Participants, except that any amendment or alteration to the Plan shall be subject to the approval of the Companys
shareholders not later than the annual meeting next following such Board action if such shareholder approval is required by any federal or state law or regulation (including, without limitation, Rule
16b-3
or
Code Section 162(m)) or the rules of the Listing Market, and the Board may otherwise, in its discretion, determine to submit other such changes to the Plan to shareholders for approval; provided that, except as otherwise permitted by the Plan
or Award Agreement, without the consent of an affected Participant, no such Board action may materially and adversely affect the rights of such Participant under the terms of any previously granted and outstanding Award. The Committee may waive any
conditions or rights under, or amend, alter, suspend, discontinue or terminate any Award theretofore granted and any Award Agreement relating thereto, except as otherwise provided in the Plan; provided that, except as otherwise permitted by the Plan
or Award Agreement, without the consent of an affected Participant, no such Committee or the Board action may materially and adversely affect the rights of such Participant under terms of such Award.
(f)
Limitation on Rights Conferred Under Plan
. Neither the Plan nor any action taken hereunder or under any Award shall be
construed as (i) giving any Eligible Person or Participant the right to continue as an Eligible Person or Participant or in the employ or service of the Company or a Related Entity; (ii) interfering in any way with the right of the Company
or a Related Entity to terminate any Eligible Persons or Participants Continuous Service at any time, (iii) giving an Eligible Person or Participant any claim to be granted any Award under the Plan or to be treated uniformly with
other Participants and Employees, or (iv) conferring on a Participant any of the rights of a shareholder of the Company including, without limitation, any right to receive dividends or distributions, any right to vote or act by written consent,
any right to attend meetings of shareholders or any right to receive any information concerning the Companys business, financial condition, results of operation or prospects, unless and until such time as the Participant is duly issued Shares
on the stock books of the Company in accordance with the terms of an Award. None of the Company, its officers or its directors shall have any fiduciary obligation to the Participant with respect to any Awards unless and until the Participant is duly
issued Shares pursuant to the Award on the stock books of the Company in accordance with the terms of an Award. Neither the Company nor any of the Companys officers, directors, representatives or agents is granting any rights under the Plan to
the Participant whatsoever, oral or written, express or implied, other than those rights expressly set forth in this Plan or the Award Agreement.
B-17
(g)
Unfunded Status of Awards; Creation of Trusts
. The Plan is intended to
constitute an unfunded plan for incentive and deferred compensation. With respect to any payments not yet made to a Participant or obligation to deliver Shares pursuant to an Award, nothing contained in the Plan or any Award shall give
any such Participant any rights that are greater than those of a general creditor of the Company; provided that the Committee may authorize the creation of trusts and deposit therein cash, Shares, other Awards or other property, or make other
arrangements to meet the Companys obligations under the Plan. Such trusts or other arrangements shall be consistent with the unfunded status of the Plan unless the Committee otherwise determines with the consent of each affected
Participant. The trustee of such trusts may be authorized to dispose of trust assets and reinvest the proceeds in alternative investments, subject to such terms and conditions as the Committee may specify and in accordance with applicable law.
(h)
Nonexclusivity of the Plan
. Neither the adoption of the Plan by the Board nor its submission to the shareholders of the
Company for approval shall be construed as creating any limitations on the power of the Board or a committee thereof to adopt such other incentive arrangements as it may deem desirable including incentive arrangements and awards which do not qualify
under Section 162(m) of the Code.
(i)
Payments in the Event of Forfeitures; Fractional Shares
. Unless otherwise
determined by the Committee, in the event of a forfeiture of an Award with respect to which a Participant paid cash or other consideration, the Participant shall be repaid the amount of such cash or other consideration. No fractional Shares shall be
issued or delivered pursuant to the Plan or any Award. The Committee shall determine whether cash, other Awards or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall
be forfeited or otherwise eliminated.
(j)
Governing Law
. The validity, construction and effect of the Plan, any rules and
regulations under the Plan, and any Award Agreement shall be determined in accordance with the laws of the Commonwealth of Massachusetts without giving effect to principles of conflict of laws, and applicable federal law.
(k)
Non-U.S.
Laws
. The Committee shall have the authority to adopt such modifications,
procedures, and subplans as may be necessary or desirable to comply with provisions of the laws of foreign countries in which the Company or its Related Entities may operate to assure the viability of the benefits from Awards granted to Participants
performing services in such countries and to meet the objectives of the Plan.
(l)
Plan Effective Date and Shareholder Approval;
Termination of Plan
. The Plan shall become effective on the Effective Date, subject to subsequent approval, within 12 months of its adoption by the Board, by shareholders of the Company eligible to vote in the election of directors, by a
vote sufficient to meet the requirements of Code Sections 162(m) (if applicable) and 422, Rule
16b-3
under the Exchange Act (if applicable), applicable requirements under the rules of any stock exchange or
automated quotation system on which the Shares may be listed or quoted, and other laws, regulations, and obligations of the Company applicable to the Plan. Awards may be granted subject to shareholder approval, but may not be exercised or otherwise
settled in the event the shareholder approval is not obtained. The Plan shall terminate at the earliest of (a) such time as no Shares remain available for issuance under the Plan, (b) termination of this Plan by the Board, or (c) the
tenth anniversary of the Effective Date. Awards outstanding upon expiration of the Plan shall remain in effect until they have been exercised or terminated, or have expired.
B-18
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YOUR VOTE IS IMPORTANT. PLEASE VOTE TODAY.
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GALECTIN
THERAPEUTICS INC.
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2017 Annual Meeting of
Stockholders
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December 14, 2017,
8:30 A.M. local time
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This Proxy is Solicited On Behalf
Of The Board Of Directors
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Please Be Sure To Mark, Sign, Date and Return Your Proxy Card
in the Envelope Provided
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FOLD HERE DO NOT SEPARATE INSERT IN ENVELOPE PROVIDED
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PROXY
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Please mark your votes like this
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☒
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1. ELECTION OF DIRECTORS
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VOTE
FOR ALL
NOMINEES
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WITHHOLD
ALL
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VOTE FOR
ALL EXCEPT
(see instructions
below)
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4.
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To approve an amendment to our Amended
and Restated 2009 Incentive Compensation
Plan to reserve an additional 1,000,000 shares
for issuance under the plan.
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FOR
☐
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AGAINST
☐
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ABSTAIN
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The Board of Directors recommends a vote FOR the listed nominees.
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☐
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☐
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☐
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To withhold authority to vote for any individual
nominee, strike a line through that nominees name below:
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5.
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In their discretion, the proxies are authorized to vote upon such
other business as may properly come before the annual meeting.
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1. Gilbert F. Amelio, Ph.D. 2. Kevin D. Freeman 3.
Marc Rubin, M.D.
4. Gilbert S. Omenn, M.D., Ph.D. 5. Joel Lewis 6. Richard E.
Uihlein
7. Stephen Shulman
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THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS INDICATED FOR THE PROPOSALS, EACH PROPOSAL WILL BE VOTED FOR THE
PROPOSAL.
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2. A proposal to ratify the appointment of Cherry Bekaert LLP as the
independent registered public accounting firm to audit the financial statements for the 2016 fiscal year. The Board of Directors recommends a vote FOR this proposal.
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FOR
☐
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AGAINST
☐
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ABSTAIN
☐
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3. To adopt and approve an amendment to our Restated Articles of Incorporation increasing the
number of authorized common voting shares (common stock) from 50,000,000 to 100,000,000.
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FOR
☐
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AGAINST
☐
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ABSTAIN
☐
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Signature
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Signature
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Date
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, 2017.
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Note: Please sign exactly as name appears hereon. When shares are held by joint owners, both should sign. When signing as
attorney, executor, administrator, trustee, guardian, or corporate officer, please give title as such.
Important Notice Regarding the Availability of Proxy Materials for the 2017 annual meeting of
stockholders of Galectin Therapeutics Inc. to be held at the offices of Dentons LLP, located at 303 Peachtree Street NE, Suite 5300, Atlanta, GA 30308 on December 14, 2017 at 8:30 A.M. EDT.
The Proxy Statement and Annual Report to Stockholders are available
at:
http://www.galectintherapeutics.com
To Vote Your Proxy
Mark, sign and date your Proxy Card on the reverse side, and return it in the
postage-paid envelope provided.
p
FOLD HERE DO NOT
SEPARATE INSERT IN ENVELOPE PROVIDED
p
PROXY