PART
III
ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Board
of Directors
Set
forth below are the names, ages, board committee assignments, tenure, and certain biographical information of each of the members
of our Board of Directors (our “Board”) as of April 26, 2019.
Name
|
|
Age
|
|
Committees
|
|
Director
Since
|
Alfred
D. Kingsley
|
|
76
|
|
None
|
|
July
2009
|
Deborah
Andrews
|
|
61
|
|
Audit*,
Compensation
|
|
April
2014
|
Don
M. Bailey
|
|
73
|
|
None
|
|
March
2019
|
Neal
C. Bradsher, CFA
|
|
53
|
|
Nominating
& Corporate Governance*
|
|
July
2009
|
Brian
M. Culley
|
|
48
|
|
None
|
|
September
2018
|
Stephen
C. Farrell
|
|
54
|
|
Audit,
Compensation, Nominating & Corporate Governance
|
|
March
2013
|
Michael
M. Mulroy
|
|
53
|
|
None
|
|
October
2014
|
Cavan
Redmond
|
|
58
|
|
Compensation*,
Nominating & Corporate Governance
|
|
February
2018
|
Angus
C. Russell
|
|
63
|
|
Audit
|
|
December
2014
|
*
Committee chairperson
Alfred
D. Kingsley.
Mr. Kingsley has been Chairman of our Board since July 2009. Mr. Kingsley has been general partner of Greenway
Partners, L.P., a private investment firm, and President of Greenbelt Corp., a business consulting firm, since 1993. Greenbelt
Corp. served as our financial advisor from 1998 until June 30, 2009. Mr. Kingsley was Senior Vice-President of Icahn and Company
and its affiliated entities for more than 25 years. Mr. Kingsley also serves as a director of OncoCyte Corporation. Mr. Kingsley
holds a BS degree in economics from the Wharton School of the University of Pennsylvania, and a J.D. degree and LLM in taxation
from New York University Law School. Mr. Kingsley’s long career in corporate finance and mergers and acquisitions includes
substantial experience in helping companies to improve their management and corporate governance, and to restructure their operations.
Mr. Kingsley developed an intimate knowledge of our business in his role as our financial advisor before he joined our Board.
Mr. Kingsley has been instrumental in structuring our equity and debt financings, and in the transition of our business focus
into the field of stem cell technology, and the business acquisitions that have helped us expand the scope of
our business.
Deborah
Andrews
.
Ms. Andrews has served as Chief Financial Officer of STAAR Surgical Company since 2017 after serving as Vice
President, Chief Accounting Officer since 2013. Ms. Andrews also served as STAAR Surgical’s Vice President, Chief Financial
Officer from 2005 to 2013, as its Global Controller from 2001 to 2005, and as its Vice President, International Finance from 1999
to 2001. Ms. Andrews previously worked as a senior accountant for a major public accounting firm. Ms. Andrews holds a B.S. degree
in Accounting from California State University at San Bernardino. Ms. Andrews brings to our Board significant experience in finance,
financial reporting, accounting and auditing, and in management as a senior financial and accounting executive of a public medical
device company during a period of significant growth.
Don
M. Bailey.
Mr. Bailey previously served as a director and Chairman of Asterias Biotherapeutics, Inc. since February 2016.
Mr. Bailey served as President and Chief Executive Officer of Questcor Pharmaceuticals, Inc. from November 2007 until Questcor
was acquired by Mallinckrodt plc in August 2014. He was also a director of Mallinckrodt plc from August 2014 to March 2016, and
during this time he was the Chairman of its portfolio committee. He initially joined the Questcor board of directors in 2006 as
an independent director and chairman of its audit committee. From August 2016 to November 2017, Mr. Bailey served as a director
of OncoCyte, a clinical-stage diagnostics company focused on novel, non-invasive blood-based tests for the early
detection of cancer.
From June 2015 until May 2016,
Mr. Bailey was also an independent director and chairman of the audit committee of Biotie Therapeutics Corp., a clinical-stage
pharmaceutical company headquartered in Turku, Finland. Mr. Bailey was an independent director and the non-executive chairman
of the board of directors of STAAR Surgical Company from April 2005 until January 2014 and a member of its board until June 2014.
Mr. Bailey served on its audit committee and was chair of its nominating and corporate governance committee. STAAR Surgical Company
is a leader in the development, manufacture, and marketing of minimally invasive ophthalmic products employing proprietary technologies.
Mr. Bailey was the chairman of the board of directors of Comarco, Inc., a defense services company transformed into a wireless
communication products company, from 1998 until 2007, where he served as chief executive officer from 1991 until 2000. Mr. Bailey
holds a B.S. degree in mechanical engineering from the Drexel Institute of Technology, an M.S. degree in operations research from
the University of Southern California, and an M.B.A. from Pepperdine University. Mr. Bailey has also served as a board member
on several non-profit and academic enterprises. Mr. Bailey serves on the board of the Business School at Chapman University in
Orange, CA and is a founding board member of the University of California Irvine’s (UCI) Applied Innovation Institute. Mr.
Bailey brings to our Board significant knowledge of the pharmaceuticals industry and extensive experience as an executive and
board member of publicly traded pharmaceutical companies.
Neal
C. Bradsher, CFA.
Mr. Bradsher has been President of Broadwood Capital, Inc., a private investment firm, since 2002. Mr.
Bradsher holds a B.A. degree in economics from Yale College and is a Chartered Financial Analyst. Mr. Bradsher was a director
of Questcor Pharmaceuticals, Inc., from March 2004 until August 2014, when Questcor was acquired by Mallinckrodt plc. Questcor
was a biopharmaceutical company focused on the treatment of patients with serious, difficult-to-treat autoimmune and inflammatory
disorders. Mr. Bradsher brings to our Board a wealth of experience in finance, management, and corporate governance attained through
his investments in other companies, including companies in the pharmaceutical, medical device, medical diagnostics, health care
services, and health care information systems sectors. He has worked with several health care companies to improve their management
and governance. Entities that Mr. Bradsher controls have invested in most of BioTime’s financing transactions over
the last several years. Mr. Bradsher is the president of the general partner of Broadwood Partners, L.P., currently our largest
shareholder.
Brian
M. Culley.
Mr. Culley j
oined BioTime as CEO in September 2018. Prior to joining
BioTime, Mr. Culley served from August 2017 to September 2018 as interim chief executive officer at Artemis Therapeutics, Inc.
Mr. Culley previously served as chief executive officer of Mast Therapeutics, Inc. (“Mast”), from February 2010, and
was also a member of its board of directors from December 2011, until Mast’s merger with Savara, Inc. in April 2017. Mr.
Culley served from January 2007 to February 2010 as Mast’s Chief Business Officer and Senior Vice President, from February
2006 to January 2007 as Mast’s Senior Vice President, Business Development, and from December 2004 to February 2006 as Mast’s
Vice President, Business Development. From 2002 until 2004, Mr. Culley was Director of Business Development and Marketing for
Immusol, Inc. From 1999 until 2000, he worked at the University of California, San Diego (UCSD) Department of Technology Transfer
& Intellectual Property Services and from 1996 to 1999 he conducted drug development research for Neurocrine Biosciences,
Inc. Mr. Culley has more than 25 years of business and scientific experience in the life sciences industry. He received a B.S.
in biology from Boston College, a masters in biochemistry and molecular biology from the University of California, Santa Barbara,
and an M.B.A. from The Johnson School of Business at Cornell University.
Mr. Culley brings to our Board significant knowledge
of the biotech industry and extensive experience as an executive and board member of publicly traded pharmaceutical companies.
Stephen
C. Farrell.
Mr. Farrell currently serves as Chief Executive Officer and Director of Convey Health Solutions (formerly
known as NationsHealth, Inc.), a healthcare business process outsourcing company headquartered in Fort Lauderdale, Florida. Convey
Health Solutions utilizes both technology and staff to manage end-to-end insurance processes for business clients. Before joining
Convey Health Solutions in 2011, he served as President of PolyMedica Corporation, a publicly traded provider of diabetes supplies
and related services that was acquired in 2007 by Medco Health Solutions. During his eight-year tenure at PolyMedica, Mr. Farrell
served as its President, Chief Operating Officer, and as Chief Financial Officer, Chief Compliance Officer, and Treasurer. Mr.
Farrell previously served as Executive Vice President and Chief Financial Officer of Stream Global Services, Inc., a business
process outsourcing company. Earlier in his career, Mr. Farrell served as Senior Manager at PricewaterhouseCoopers LLP. Mr. Farrell
holds an A.B. from Harvard University, and an M.B.A. from the Darden School at the University of Virginia. Mr. Farrell served
on the board and was chairman of the Audit Committee of Questcor Pharmaceuticals, Inc., a biopharmaceutical company focused on
the treatment of patients with serious, difficult-to-treat autoimmune and inflammatory disorders from November 2007 to until August
2014, when Questcor was acquired by Mallinckrodt plc. Mr. Farrell also currently serves as a director of STAAR Surgical Company,
a designer and developer of implantable lenses for the eye. Mr. Farrell brings to our Board significant experience in finance,
financial reporting, accounting and auditing, and in management as a senior executive of a public healthcare company during a
period of significant growth.
Michael
H. Mulroy
. Mr. Mulroy served as the Chief Executive Officer and a member of the Board of Directors of Asterias
Biotherapeutics, Inc., a publicly traded biotechnology company from June 2017 to March 2019. Prior to joining Asterias, Mr. Mulroy
served as a Senior Advisor to CamberView Partners, LLC, which assists companies in connection with investor engagement and complex
corporate governance issues. Mr. Mulroy served until September 2014 as Executive Vice President - Strategic Affairs and General
Counsel of the Autoimmune and Rare Diseases Business Unit of Mallinckrodt plc following its acquisition of Questcor Pharmaceuticals,
Inc. in August 2014. Mr. Mulroy was appointed Executive Vice President, Strategic Affairs and General Counsel and Corporate Secretary
of Questcor during February 2014, having previously served as Chief Financial Officer, General Counsel and Corporate Secretary
since January 2011. From 2003 to 2011, Mr. Mulroy was employed by the law firm of Stradling Yocca Carlson & Rauth, where he
served as a partner from 2004, and represented Questcor and other publicly-traded companies. From 1997 to 2003, Mr. Mulroy was
an investment banker at Citigroup and Merrill Lynch. Mr. Mulroy also serves on the Board of Directors of Agex Therapeutics,
Inc., a biotechnology company focused on the development and commercialization of novel therapeutics targeting human aging. He
is also a member
of the Board of Trustees of the Pegasus School, an independent primary school in Orange County,
California.
From July 2011 to August 2014, Mr. Mulroy
served as a member of the Board of Directors of Comarco, Inc., which developed and designed innovative technologies and intellectual
property used in power adapters. Mr. Mulroy earned his J.D. degree from the University of California, Los Angeles and his B.A.
(Economics) from the University of Chicago. Mr. Mulroy brings to our Board his experience as the chief executive officer of a
publicly-traded biotechnology company and member of a senior management team of a larger biopharmaceutical company that experienced
a period of rapid growth. Mr. Mulroy also brings to our Board his experience in corporate finance and investor relations.
Cavan
Redmond
. Mr. Redmond is a seasoned healthcare strategist, who has held a number of global leadership positions. He currently
is a partner at Zarsy, LLC. His global leadership roles include: CEO of WebMD Health Corp., where he oversaw cost rationalizations
and streamlined operations to position the company for growth; Senior Vice President and Group President, Pfizer Diversified Businesses.
The Diversified Business included Animal Health, Consumer Healthcare, Capsugel and Nutrition. While at Pfizer he also became the
head of Corporate Strategy. While at Wyeth he was the first EVP and General Manager Wyeth Biopharma and President of Wyeth Consumer
Healthcare. Mr. Redmond also serves as a director of OncoCyte Corporation and he is currently a member of the Board of Directors
for the Arthritis Foundation, where he has served since 2014. Mr. Redmond holds a MAS degree from Johns Hopkins University and
a BA from the University of Maryland at College Park. He was a 2012 recipient of The Johns Hopkins University Distinguished Alumnus
Award. Mr. Redmond brings to our Board significant knowledge of the pharmaceuticals industry and extensive experience as an executive
and board member of publicly traded companies.
Angus
C. Russell.
Mr. Russell served as the Chief Executive Officer of Shire plc, a biopharmaceutical company, from June 2008
to April 2013. Mr. Russell served as the Chief Financial Officer of Shire from 1999 to 2008 and also served as its Principal Accounting
Officer and Executive Vice President of Global Finance. Prior to joining Shire, Mr. Russell served at ICI, Zeneca and AstraZeneca
for 19 years, most recently as Vice President of Corporate Finance at AstraZeneca plc. He is a Chartered Accountant, having qualified
with Coopers & Lybrand (now PriceWaterhouseCoopers LLP). Mr. Russell also serves as Chairman of the Board of Directors
of Mallinckrodt plc and Revance Therapeutics, Inc. and a director of Therapeutics MD, Inc. Mr. Russell previously served as
a director of Shire plc, Questcor Pharmaceuticals, Inc. until it was acquired by Mallinckrodt plc in August 2014, and InterMune,
Inc. prior to its acquisition by Roche Holdings, Inc. during September 2014. Mr. Russell brings to our Board numerous years of
experience as a Chief Executive Officer of an international publicly traded specialty biopharmaceutical company and his substantial
experience as an officer and director in the specialty pharmaceutical industry.
Executive
Officers
Set
forth below are the names, ages, offices held, tenure, and certain biographical information of each of our executive officers
as of April 26, 2019.
Name
|
|
Age
|
|
Offices
|
|
Officer
Since
|
Brian
M. Culley
|
|
48
|
|
CEO
and Director
|
|
September
2018
|
Brandi
L. Roberts
|
|
45
|
|
Chief
Financial Officer and Secretary
|
|
January
2019
|
Edward
D. Wirth, III, M.D., Ph.D.
|
|
54
|
|
Chief
Medical Officer
|
|
March
2019
|
Gary
S. Hogge, D.V.M., Ph.D.
|
|
51
|
|
Senior
Vice President of Clinical & Medical Affairs
|
|
March
2019
|
Mr.
Culley’s biographical information is included above with those of the other members of our Board.
Brandi
L. Roberts
.
Ms. Roberts joined BioTime as CFO in January 2019. Prior to joining
BioTime, Ms. Roberts served from August 2017 to January 4, 2019 as Chief Financial Officer at REVA Medical, Inc. Ms. Roberts previously
served as Chief Financial Officer at Mast Therapeutics, Inc., a publicly traded US-based biopharmaceutical company, from January
2013 to April 2017, having served as its Senior Vice President, Finance from March 2011 to January 2013. Previously, she held
senior positions at Alphatec Spine, Artes Medical, Stratagene and Pfizer. Ms. Roberts brings more than 23 years of public accounting
and finance experience, including 20 years at publicly traded pharmaceutical, medical technology, and life science companies to
her position. Ms. Roberts is a certified public accountant with the State of California and received her B.S. in Business Administration
from the University of Arizona and her M.B.A. from the University of San Diego. She also currently serves as Chair of the Southern
California Chapter of the Association of Bioscience Financial Officers.
Edward
D. Wirth, III, M.D., Ph.D
. Dr. Wirth
has been our Chief Medical Officer since March
2019. Prior to joining BioTime, he held the roles of Chief Translational Officer and Chief Medical Officer at Asterias Biotherapeutics,
Inc. since March 2013. Dr. Wirth previously served as Chief Science Officer at InVivo Therapeutics Corporation from 2011 to 2012.
From 2004 to 2011, Dr. Wirth served as Medical Director for Regenerative Medicine at Geron, where he led the world’s first
clinical trial of a human embryonic stem cell derived product, GRNOPC1 in patients with subacute spinal cord injuries. Dr. Wirth
held academic appointments at Rush-Presbyterian St. Luke’s Medical Center and at the University of Chicago from 2002 to
2004, and was a member of the faculty of the University of Florida from 1996 to 2002. Dr. Wirth received his Ph.D. and M.D. from
the University of Florida in 1992 and 1994, respectively.
Gary
Hogge, D.V.M., Ph.D
. Dr. Hogge
joined BioTime as our Senior Vice President of Clinical
and Medical Affairs in February 2018. Dr. Hogge has nearly 20 years of experience developing and supporting the commercialization
of a number of products over a broad range of therapeutic areas. Dr. Hogge has held a variety of roles of increasing responsibility
across multiple therapeutic areas in both clinical development and medical affairs. Previously Gary was the Vice President of
Medical Affairs at Questcor Pharmaceuticals and before that held multiple leadership roles in both clinical development and medical
affairs at Elan Pharmaceuticals including responsibility for the global clinical development of Tysabri
®
(natalizumab)
in Crohn’s disease and multiple sclerosis, and for building and leading the medical affairs function. He served as medical
director following the approval and launch of Tysabri. Prior to those accomplishments, he worked in clinical development for Ceplene
®
(histamine dihydrochloride) at Maxim Pharmaceuticals and in the immunology research and development group at Pfizer. Dr.
Hogge obtained his bachelor’s degree and D.V.M. from Colorado State University, his M.S. and Ph.D. from the University of
Wisconsin-Madison and was a visiting scientist at the Queensland Institute of Medical Research QIMR in Brisbane, Australia.
Family
Relationships; Arrangements; Legal Proceedings
There
are no family relationships among any of our directors and executive officers. There are no arrangements or understandings with
another person under which our directors and officers was or is to be selected as a director or executive officer. Additionally,
none of our directors or executive officers is involved in any legal proceeding that requires disclosure under Item 401(f) of
Regulation S-K.
Section
16(a) Beneficial Ownership Reporting Compliance
Section
16(a) of Exchange Act requires our directors and executive officers and persons who own more than ten percent (10%) of a registered
class of our equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of common
shares and other BioTime equity securities. Officers, directors and greater than ten percent beneficial owners are required by
SEC regulations to furnish us with copies of all reports they file under Section 16(a).
To
our knowledge, based solely on our review of the copies of such reports furnished to us and written representations from reporting
persons, all Section 16(a) filing requirements applicable to our officers, directors, and greater than ten percent beneficial
owners were complied with during the fiscal year ended December 31, 2018, except that one Form 3 was filed late by Cavan Redmond.
Code
of Ethics
We
have adopted a Code of Business Conduct and Ethics (“Code of Ethics”) that applies to our principal executive officers,
our principal financial officer and accounting officer, our other executive officers, and our directors. The purpose of the Code
of Ethics is to promote (i) honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest
between personal and professional relationships; (ii) full, fair, accurate, timely, and understandable disclosure in reports and
documents that we file with or submit to the SEC and in our other public communications; (iii) compliance with applicable governmental
rules and regulations; (iv) prompt internal reporting of violations of the Code of Ethics to an appropriate person or persons
identified in the Code of Ethics; and (v) accountability for adherence to the Code of Ethics. A copy of our Code of Ethics has
been posted on our internet website and can be found at
www.biotimeinc.com
. We intend to disclose any future amendments
to certain provisions of our Code of Ethics, and any waivers of those provisions granted to our principal executive officer, principal
financial officer, principal accounting officer or controller or persons performing similar functions, by posting the information
on our website within four business days following the date of the amendment or waiver.
Audit
Committee and Audit Committee Financial Expert
The
Audit Committee of our Board of Directors is an audit committee established in accordance with Section 3(a)(58)(A) of the Exchange
Act. Our Board of Directors has determined that each member of the Audit Committee—Ms. Andrews, Mr. Farrell and Mr. Russell
—is able to read and understand fundamental financial statements, including our balance sheet, income statement and cash
flow statement. Our Board of Directors has also determined that Ms. Andrews and Mr. Russell qualifies as an “audit committee
financial expert,” as defined in Item 407(d)(5) of Regulation S-K. Ms. Andrews’ expertise is based on her experience
as Chief Financial Officer and other financial roles of STAAR Surgical Company and as a senior accountant at a major accounting
firm. Mr. Russell’s expertise is based on his experience as the Chief Executive Officer and Chief Financial Officer of Shire
plc, a biopharmaceutical company. Additionally, each member of the audit committee meets the independent requirements contemplated
by Rule 10-3A under the Exchange Act.
Changes
in Stockholder Nomination Procedures
There
have been no material changes to the procedures by which stockholders may recommend nominees to our Board of Directors since such
procedures were last described in our proxy statement filed with the SEC on May 1, 2018.
ITEM
11. EXECUTIVE COMPENSATION
Overview
The
members of the Compensation Committee are Cavan Redmond (Chair), Deborah Andrews and Stephen C. Farrell. The Compensation Committee
oversees our compensation and employee benefit plans and practices, including executive compensation arrangements and incentive
plans and awards of stock options and other equity-based awards under our Equity Incentive Plan. The Compensation Committee recommends
to our Board of Directors the terms and amount of executive compensation and grants of equity-based awards to executives, key
employees, consultants, and independent contractors. The Chief Executive Officer may make recommendations to the Compensation
Committee concerning executive compensation and performance, but the Compensation Committee makes its own determination or recommendation
to our Board of Directors with respect to the amount and components of compensation, including salary, bonus and equity awards
to executive officers, generally taking into account factors such as company performance, individual performance, and compensation
paid by peer group companies. A copy of the Compensation Committee Charter has been posted on our internet website and can be
found at
www.biotimeinc.com
.
We
have engaged Marsh & McLennan to provide compensation consulting services and advice to management and the Compensation
Committee, which has generally included market survey information and competitive market trends in employee, executive and directors’
compensation programs. Marsh & McLennan has also made recommendations to the Compensation Committee with respect to
pay mix components such as salary, bonus and equity awards, and the target market pay percentiles in which executive compensation
should fall so BioTime can be competitive in executive hiring and retention.
In
reviewing each executive’s overall compensation, the Compensation Committee considers an aggregate view of base salary and
bonus opportunities, previous stock option grants, and the dollar value of benefits and perquisites. Executive compensation is
also influenced by the cost of living in or commuting to the San Francisco Bay Area. These factors have been balanced against
our financial position and capital resources.
Named
Executive Officers
The
table below shows the compensation awarded to, paid to, or earned by: (1) all individuals serving or having served as our principal
executive officer or acting in a similar capacity during 2018, regardless of compensation level; and (2) our two most highly compensated
executive officers other than our principal executive officers who were serving as an executive officer at the end of 2018. These
individuals, who collectively are referred to as our Named Executive Officers, or NEOs, were:
|
●
|
Brian
M. Culley, our Chief Executive Officer;
|
|
|
|
|
●
|
Michael
D. West, our former Co-Chief Executive Officer;
|
|
|
|
|
●
|
Aditya
P. Mohanty
, our former Co-Chief Executive Officer;
|
|
|
|
|
●
|
Russell
L. Skibsted, our former Chief Financial Officer; and
|
|
|
|
|
●
|
Stephana
E. Patton, our former General Counsel.
|
Other
than Mr. Culley, all of our current executive officers (Ms. Roberts, Dr. Wirth and Dr. Hogge) were appointed to their positions
in 2019 and therefore none of them are an NEO for 2018.
|
|
2018
Summary Compensation Table
|
|
Name
and Principal Position
|
|
Fiscal
Year
|
|
|
Salary
|
|
|
Bonus
|
|
|
Option
Awards
(4)
|
|
|
Stock
Awards
(5)
|
|
|
All
Other Compensation
|
|
Total
|
|
Brian
M. Culley
(1)
|
|
2018
|
|
|
$
|
154,923
|
|
|
$
|
-
|
|
|
$
|
1,917,320
|
|
|
$
|
693,000
|
|
$
|
7,135
|
(6)
|
$
|
2,772,378
|
|
Chief
Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael
D. West
(2)
|
|
2018
|
|
|
|
489,303
|
|
|
|
48,750
|
|
|
|
-
|
|
|
|
36,781
|
|
|
790,279
|
(7)
|
|
1,365,113
|
|
Former
Co-Chief Executive Officer
|
|
2017
|
|
|
|
680,315
|
|
|
|
65,000
|
|
|
|
865,720
|
|
|
|
-
|
|
|
13,500
|
(6)
|
|
1,624,535
|
|
Aditya
P. Mohanty
(2)
|
|
2018
|
|
|
|
378,869
|
|
|
|
200,000
|
|
|
|
278,063
|
|
|
|
230,797
|
|
|
235,298
|
(8)
|
|
1,323,027
|
|
Former
Co-Chief Executive Officer
|
|
2017
|
|
|
|
511,423
|
|
|
|
206,000
|
|
|
|
1,135,467
|
|
|
|
-
|
|
|
13,500
|
(6)
|
|
1,866,390
|
|
Russell
L. Skibsted
(3)
|
|
2018
|
|
|
|
381,468
|
|
|
|
100,000
|
|
|
|
208,869
|
|
|
|
48,150
|
|
|
13,750
|
(6)
|
|
752,237
|
|
Former
Chief Financial Officer
|
|
2017
|
|
|
|
368,225
|
|
|
|
108,000
|
|
|
|
433,036
|
|
|
|
-
|
|
|
13,500
|
(6)
|
|
922,761
|
|
Stephana
E. Patton
(3)
|
|
2018
|
|
|
|
324,062
|
|
|
|
97,000
|
|
|
|
174,387
|
|
|
|
58,850
|
|
|
13,750
|
(6)
|
|
668,049
|
|
Former
General Counsel
|
|
2017
|
|
|
|
284,711
|
|
|
|
80,000
|
|
|
|
432,500
|
|
|
|
-
|
|
|
13,500
|
(6)
|
|
810,711
|
|
(1)
|
Mr.
Culley was appointed as Chief Executive Officer on September 17, 2018.
|
(2)
|
The
employment of Mr. West and Mr. Mohanty terminated on September 17, 2018 and their base salaries for 2018 represent the amounts
paid to each of them from January 1, 2018 through September 17, 2018.
|
(3)
|
The
employment of Mr. Skibsted and Ms. Patton terminated on January 3, 2019 and March 1, 2019, respectively. Their terminations
did not impact base salaries for 2018.
|
(4)
|
The
amounts in this column represent the grant date fair value of stock options granted to the applicable individual during the
applicable year. The grant date fair value and incremental fair value of the stock options were determined in accordance with
ASC Topic 718,
Compensation – Stock Compensation (ASC Topic 718)
. See Note 13, Stock Based Awards to our
consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with
the SEC on March 14, 2019 for details as to the assumptions used to determine grant date fair value of the awards.
|
(5)
|
The
amounts in this column represent the fair value of restricted stock units that were either granted during 2018, in the case
of Mr. Culley, or that vested in 2018 due to the achievement of certain performance-based milestones, in the case of all other
NEOs.
|
(6)
|
These
amounts represent 401(k) plan company-matching contributions.
|
(7)
|
This
amount consists of (a) a $680,315 severance payment, (b) $96,214 for the payout of accrued vacation at termination and (c)
$13,750 in 401(k) plan company-matching contributions.
|
(8)
|
This
amount consists of (a) a $152,600 severance payment, (b) $61,212 for the payout of accrued vacation at termination, (c) $13,750
in 401(k) plan company-matching contributions and (d) $7,736 in COBRA group health insurance premiums.
|
Narrative
to Summary Compensation Table
Current
Executive Officers
Mr.
Culley was appointed as Chief Executive Officer on September 17, 2018. The amounts reported for him in the Summary Compensation
Table, above, represents compensation paid to or earned by him for his service as an executive officer between September 17, 2018
and December 31, 2018. Mr. Culley’s base salary for 2018 was $530,000. In September 2018, our Board of Directors granted
Mr. Culley a stock option to purchase 1,500,000 of our common stock at an exercise price of $2.31. In connection with the AgeX
distribution which occurred in November 2018, all BioTime equity awards issued and outstanding were adjusted to maintain the intrinsic
value of those awards immediately prior to and following the AgeX distribution. Accordingly, Mr. Culley’s stock option was
amended to reflect an option to purchase 1,854,000 of the Company’s common shares at an exercise price of $1.87. In February
2019, our Board of Directors increased Mr. Culley’s annual base salary for 2019 to $535,800 and awarded him a bonus of $70,000
for his performance during 2018.
Former
Executive Officers
In
September 2018, we entered into transition agreements with Dr. West and Mr. Mohanty in connection with their resignations as our
co-chief executive officers. Pursuant to Dr. West’s transition agreement, he was paid a total of $729,065, his outstanding
equity awards vested as of the transition date and he became entitled to exercise such options until their expiration dates. Dr.
West also received a payment of $96,214 for accrued vacation. Pursuant to Mr. Mohanty’s transition agreement, he was paid
$152,600 and was entitled to a 2018 bonus in an amount to be determined by our Board of Directors at a later date. In February
2019, our Board of Directors approved a $200,000 bonus to Mr. Mohanty. Mr. Mohanty’s outstanding equity awards will continue
to vest for the longer of, 12 months from his date of transition, or for as long as Mr. Mohanty continues to provide services
to us, our subsidiaries or affiliates. Mr. Mohanty also received a payment of $61,212 for accrued vacation and payment for 12
months of COBRA group health insurance premiums.
In
February 2019, we entered into a separation agreement with Mr. Skibsted, our former Chief Financial Officer. Pursuant to the separation
agreement, Mr. Skibsted received cash severance equal to six months of his annual base salary, a portion of his bonus target amount
equal to $100,000, payment for six months of COBRA group health insurance premiums and accelerated vesting of all outstanding
option grants as well as an extension of the exercise period until January 2, 2020.
Employment
Agreements and Termination of Employment & Change in Control Arrangements
Brian
M. Culley, Chief Executive Officer
In
September 2018, we entered into an employment agreement with Mr. Culley. The following is a description of the material terms
of that agreement.
Mr.
Culley is paid an annual base salary of $530,000. He is eligible to receive a performance bonus of up to 50% of his base salary
based upon the attainment of certain corporate and individual objectives as determined by our Board or its Compensation Committee.
He is entitled to reimbursement for certain travel costs to our headquarters, a monthly stipend not to exceed $3,900 for housing
costs near our headquarters, and to the standard benefits available to our employees generally, including health insurance.
We
granted Mr. Culley a stock option to purchase 1,500,000 of shares of our common stock with an exercise price per share of $2.31,
which was the closing price of our common stock on September 17, 2018. This grant was approved by the independent members of our
Board in reliance on the employment inducement exemption to shareholder approval provided under NYSE American rules. Subject to
Mr. Culley’s continued service, 25% of the shares subject to the option will vest and become exercisable on the 12 month
anniversary of the grant date of September 17, 2018, and the balance of the shares will vest and become exercisable in 36 equal
monthly installments at the end of each one-month period thereafter. Mr. Culley was also granted an award of 200,000 restricted
stock units (“RSU Award No. 1”). Subject to his continued service, 25% of the shares subject to RSU Award No. 1 will
vest on the 12-month anniversary of the grant date of September 17, 2018, and the balance of the shares will vest in 12 equal
quarterly installments at the end of each quarter thereafter. Mr. Culley was also granted an award of 100,000 restricted stock
units (“RSU Award No. 2” and together with RSU Award No. 1, the “RSU Awards”), which vested in full on
January 1, 2019. The RSU Awards are subject to the terms of our 2012 Equity Incentive Plan, as amended. All equity award described
in this paragraph do not reflect the adjustments made thereto in connection with the AgeX distribution, which are described below.
On
November 28, 2018, in connection with the commencement of the public trading of shares of common stock of AgeX Therapeutics, Inc.
“AgeX”, we distributed 12.7 million shares of AgeX common stock we owned to our shareholders, on a pro rata
basis, in the ratio of one share of AgeX common stock for every 10 shares of our common stock they owned. In connection with that
distribution of AgeX common stock to our shareholders, all our outstanding equity awards were adjusted to maintain the intrinsic
value of those awards immediately prior to and following the distribution. Accordingly, the stock option we granted to Mr. Culley
described above is now a stock option to purchase 1,854,000 shares of our common stock with an exercise price of $1.87 per share,
and there are 247,200 and 123,600 shares of our common stock subject to RSU Award No. 1 and RSU Award No. 2, respectively.
If
Mr. Culley’s employment is terminated without cause or he resigns for good reason, then he may be eligible for certain severance
payments including the payment of an amount equal to 12 months of his base salary, his full annual bonus amount and the payment
of 6 months of health insurance premiums pursuant to our group health insurance plans as provided pursuant to COBRA. If Mr. Culley’s
employment is terminated without cause or he resigns for good reason within 12 months following a change of control, then he is
entitled to the acceleration of all his outstanding equity awards.
Other
Benefits
We
maintain a defined contribution employee retirement plan for all our employees. Our 401(k) plan is intended to qualify as a tax-qualified
plan under Section 401 of the Internal Revenue Code so that contributions to our 401(k) plans, and income earned on such contributions,
are not taxable to participants until withdrawn or distributed from the 401(k) plan. We match employee contributions up to 5%
of their annual compensation, subject to statutory limits.
We
do not have any annuity, pension or deferred compensation plan or other arrangements for our executive officers or any employees.
Outstanding
Equity Awards at Fiscal Year-End
The
following table sets forth information concerning equity awards held by our Named Executive Officers that were outstanding as
of December 31, 2018:
|
|
|
|
Option
Awards
|
|
|
Stock
Awards
|
|
Name
|
|
Stock Option
Plan Name
|
|
Number
of
Securities
Underlying
Unexercised
Options
Exercisable
(1)
|
|
|
Number
of Securities Underlying Unexercised Options Unexercisable (1)
|
|
|
Option
Exercise
Price
(1)
|
|
|
Option
Expiration
Date
|
|
|
Number
of
Shares
or
Units
of
Stock
that
have
Not
Vested
(1)
|
|
|
Market
Value
of
Shares
or
Units of
Stock
that
have
Not
Vested
(10)
|
|
Brian M. Culley
|
|
BioTime, Inc.
Inducement Option
|
|
|
-
|
|
|
|
1,854,000
|
(2)
|
|
$
|
1.87
|
|
|
|
September
16, 2028
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
123,600
|
(3)
|
|
$
|
112,484
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
247,200
|
(4)
|
|
$
|
224,969
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael D. West
|
|
BioTime, Inc.
2012 Equity Incentive Plan
|
|
|
216,299
|
|
|
|
-
|
(5)
|
|
$
|
2.60
|
|
|
|
April
6, 2026
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
247,200
|
|
|
|
-
|
(5)
|
|
$
|
2.84
|
|
|
|
July
9, 2025
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
247,199
|
|
|
|
-
|
(5)
|
|
$
|
2.84
|
|
|
|
March
19, 2021
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
247,199
|
|
|
|
-
|
(5)
|
|
$
|
3.41
|
|
|
|
February
19, 2020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BioTime Asia, Limited
2011 Stock Option Plan
|
|
|
200
|
|
|
|
-
|
|
|
$
|
0.01
|
|
|
|
December
28, 2020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
OrthoCyte Corporation 2010 Stock Option Plan
|
|
|
500,000
|
|
|
|
-
|
|
|
$
|
0.05
|
|
|
|
December
28, 2020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aditya P. Mohanty
|
|
BioTime, Inc.
2012 Equity Incentive Plan
|
|
|
-
|
|
|
|
247,199
|
(6)
|
|
$
|
2.05
|
|
|
|
March
14, 2028
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
368,230
|
|
|
|
435,169
|
(6)
|
|
$
|
2.56
|
|
|
|
June
5, 2027
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
309,005
|
|
|
|
154,494
|
(6)
|
|
$
|
2.60
|
|
|
|
April
6, 2026
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
834,299
|
|
|
|
-
|
(6)
|
|
$
|
3.06
|
|
|
|
December
28, 2024
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
34,765
|
(6)(7)
|
|
$
|
31,636
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Russell L. Skibsted
|
|
BioTime, Inc.
2012 Equity Incentive Plan
|
|
|
-
|
|
|
|
185,399
|
(8)
|
|
$
|
2.05
|
|
|
|
January
2, 2020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
141,624
|
|
|
|
167,375
|
(8)
|
|
$
|
2.56
|
|
|
|
January
2, 2020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
34,763
|
|
|
|
27,037
|
(8)
|
|
$
|
2.82
|
|
|
|
January
2, 2020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
428,725
|
|
|
|
127,474
|
(8)
|
|
$
|
2.72
|
|
|
|
January
2, 2020
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stephana E. Patton
|
|
BioTime, Inc.
2012 Equity Incentive Plan
|
|
|
-
|
|
|
|
154,499
|
(9)
|
|
$
|
2.05
|
|
|
|
May
30, 2019
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
141,623
|
|
|
|
167,376
|
(9)
|
|
$
|
2.47
|
|
|
|
May
30, 2019
|
|
|
|
-
|
|
|
|
-
|
|
|
(1)
|
On
November 28, 2018, in connection with the commencement of the public trading of shares of common stock of AgeX Therapeutics,
Inc., we distributed 12.7 million shares of AgeX common stock we owned to our shareholders, on a pro rata basis, in the ratio
of one share of AgeX common stock for every 10 shares of our common stock they owned. In connection with that distribution
of AgeX common stock to our shareholders, all our outstanding equity awards were adjusted to maintain the intrinsic value
of those awards immediately prior to and following the distribution. The information in this table reflects those adjustments.
|
|
|
|
|
(2)
|
Subject
to Mr. Culley’s continued service, one quarter of the shares subject to this option will vest on September 17, 2019,
and the balance of the shares will vest in 36 equal monthly installments thereafter.
|
|
|
|
|
(3)
|
Subject
to Mr. Culley’s continued service, one quarter of these shares will vest on September 17, 2019, and the balance will
vest in 12 equal quarterly installments at the end of each quarter thereafter.
|
|
|
|
|
(4)
|
Represents
shares subject to a restricted stock unit award that vested in full on January 1, 2019.
|
|
|
|
|
(5)
|
In
accordance with Dr. West’s transition agreement, all options vested in full as of September 17, 2018 and he has until
their original expiration dates to exercise such options.
|
|
|
|
|
(6)
|
In
accordance with Mr. Mohanty’s transition agreement, his outstanding equity awards will continue to vest for the longer
of 12 months from his date of transition (September 17, 2018) or for as long as he continues to provide services to us, our
subsidiaries or affiliates. Options expiring on March 14, 2028 were granted on March 15, 2018; 25% will vest on February
1, 2019 and the balance of the options vest in 36 equal monthly installments. Options expiring on June 5, 2027 had 25% vested
on February 1, 2018 and the balance of the options vest in 36 equal monthly installments. Options expiring on April 6, 2026
had 25% vested on April 7, 2017 and the balance of the options vest in 36 equal monthly installments. Options expiring on
December 28, 2024 vest in 48 equal monthly installments from the date of grant, December 29, 2014.
|
|
(7)
|
The
RSUs were granted under BioTime’s Equity Incentive Plan on April 11, 2016, at which time the closing price on the NYSE
American was $2.96 per share. These restricted stock units vest over a 4-year period with the first 25% vested on April 11,
2017 and the balance vesting in equal quarterly installments over the remaining 3 years.
|
|
|
|
|
(8)
|
In
accordance with Mr. Skibsted’s separation agreement, all of Mr. Skibsted’s outstanding options fully vested as
of February 19, 2019 and he has until January 2, 2020 to exercise such options.
|
|
|
|
|
(9)
|
Ms.
Patton resigned from BioTime on March 1, 2019, and her options ceased further vesting on such date. Ms. Patton has 90 days
from her resignation date (May 30, 2019) to exercise her vested options.
|
|
|
|
|
(10)
|
The
dollar amounts shown in this column are calculated by multiplying the number of shares shown in the adjacent column by the
closing market price of our common stock as reported on NYSE American on December 31, 2018 ($0.91), the last trading day of
our fiscal year.
|
Director
Compensation
We
compensate our non-employee directors for their service on our Board and on its committees with cash and equity as discussed below.
In addition, all of our non-employee directors are entitled to reimbursements for their out-of-pocket expenses incurred in attending
our Board and committee meetings.
The
following table shows the annual cash fees paid to the Chairman of our Board, our directors other than the Chairman, and to the
directors who served on the standing committees of our Board during 2018.
|
|
Fees Paid
|
|
Chairman of the Board
|
|
$
|
75,000
|
|
Director other than Chairman
|
|
$
|
40,000
|
|
Audit Committee Chairman
|
|
$
|
20,000
|
|
Audit Committee Member other than Chairman
|
|
$
|
10,000
|
|
Compensation Committee Chairman
|
|
$
|
15,000
|
|
Compensation Committee Member other than Chairman
|
|
$
|
7,500
|
|
Nominating and Corporate Governance Committee Chairman
|
|
$
|
15,000
|
|
Nominating and Corporate Governance Committee Member other than Chairman
|
|
$
|
7,500
|
|
Financial Strategy Committee Chairman
|
|
$
|
160,000
|
|
Financial Strategy Committee Member other than Chairman
|
|
$
|
-
|
|
In
addition to cash fees, our directors receive an annual stock option grant to purchase 40,000 common shares, except the grant to
our Chairman is for 70,000 common shares. Mr. Redmond joined our Board in 2018 and received a stock option to purchase 60,000,
which was amended to a stock option to purchase 74,160 common shares in conjunction with the AgeX distribution. All grants
are made under our 2012 Equity Incentive Plan.
The
annual fee of cash was paid, and the stock options vested and became exercisable, in four equal quarterly installments, based
on the director’s continued service through the last day of the applicable quarter. The options will expire if not exercised
on the earlier of the date five years from the date of grant or 90 days after the director ceases to serve on our Board.
The
following table summarizes certain information concerning the compensation paid during the past fiscal year to each of the persons
who served as directors during the year ended December 31, 2018 and who were not our employees on the date the compensation was
earned.
2018
DIRECTOR COMPENSATION
Name
|
|
Fees Earned
or Paid in
Cash (1)
|
|
|
Option
Award (2)
|
|
|
All Other Compensation
|
|
|
Total
|
|
Deborah Andrews
|
|
$
|
67,500
|
|
|
$
|
33,045
|
|
|
$
|
-
|
|
|
$
|
100,545
|
|
Neal C. Bradsher
|
|
$
|
60,625
|
|
|
$
|
33,045
|
|
|
$
|
-
|
|
|
$
|
93,670
|
|
Stephen C. Farrell
|
|
$
|
71,875
|
|
|
$
|
33,045
|
|
|
$
|
-
|
|
|
$
|
104,920
|
|
Alfred D. Kingsley
|
|
$
|
240,625
|
|
|
$
|
57,829
|
|
|
$
|
130,712
|
(5)
|
|
$
|
429,166
|
|
Michael H. Mulroy
|
|
$
|
40,000
|
|
|
$
|
33,045
|
|
|
$
|
-
|
|
|
$
|
73,045
|
|
Cavan Redmond (3)
|
|
$
|
60,625
|
|
|
$
|
94,006
|
|
|
$
|
-
|
|
|
$
|
154,631
|
|
Angus C. Russell
|
|
$
|
55,625
|
|
|
$
|
33,045
|
|
|
$
|
-
|
|
|
$
|
88,670
|
|
David Schlachet (4)
|
|
$
|
14,375
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
14,375
|
|
|
(1)
|
Includes
annual cash fees for serving as a director and fees for service on committees of the Board, if any.
|
|
|
|
|
(2)
|
Those
of our directors who were serving on our Board on July 1, 2018 and who were not our salaried employees each received an annual
award of stock options on that date entitling them to purchase 49,440 common shares at a fixed price as partial compensation
for serving on our Board for a period of one year, except that Mr. Kingsley received 86,520 stock options as partial compensation
for serving in his capacity as Chairman of our Board. Those options will vest and become exercisable in equal quarterly installments
over a one-year period. The dollar amounts in this column represent the aggregate fair market value of such awards determined
based on the price of our common stock on the grant date in accordance with ASC Topic 718,
Compensation-Stock Compensation
(ASC Topic 718)
. See Note 13 Stock-Based Awards to our Consolidated Financial Statements included in our Annual Report
on Form 10-K for the year ended December 31, 2018 for details as to the assumptions used to determine the fair value of the
awards.
|
|
|
|
|
(3)
|
Mr.
Redmond joined our Board on February 21, 2018.
|
|
|
|
|
(4)
|
Mr.
Schlachet resigned from our Board on May 1, 2018.
|
|
|
|
|
(5)
|
Comprised
of $120,000 in salary, $4,712 in health insurance benefits and $6,000 in 401(k) matching contributions paid to Mr.
Kingsley as an executive of AgeX through August 30, 2018, the date of the AgeX deconsolidation.
|
As
of December 31, 2018, our non-employee directors had stock options outstanding to purchase the following number of shares of our
common stock:
Name
|
|
# of Shares Subject to Outstanding Options
|
|
Deborah Andrews
|
|
|
173,040
|
|
Neal C. Bradsher
|
|
|
148,320
|
|
Stephen C. Farrell
|
|
|
148,320
|
|
Alfred D. Kingsley
|
|
|
333,720
|
|
Michael H. Mulroy
|
|
|
148,320
|
|
Cavan Redmond
|
|
|
123,600
|
|
Angus C. Russell
|
|
|
148,320
|
|
ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The
tables below sets forth certain information, as of April 22, 2019, regarding the beneficial ownership of our common stock
for (1) each person known by us to be the beneficial owner of more than 5% of our common stock, (2) each of our directors, (3)
each of our Named Executive Officers and (4) all of our current directors and executive officers as a group.
We
have determined beneficial ownership in accordance with applicable SEC rules, and the information reflected in the table below
is not necessarily indicative of beneficial ownership for any other purpose. Under applicable SEC rules, beneficial ownership
includes any shares of common stock as to which a person has sole or shared voting power or investment power and any shares of
common stock which the person has the right to acquire within 60 days after the date set forth in the paragraph above through
the exercise of any option, warrant or right or through the conversion of any convertible security. Unless otherwise indicated
in the footnotes to the table below and subject to community property laws where applicable, we believe, based on the information
furnished to us and on SEC filings, that each of the persons named in table below has sole voting and investment power with respect
to the shares indicated as beneficially owned.
The
information set forth in the tables below is based on 149,642,861 shares of our common stock issued and outstanding on
April 22, 2019. In computing the number of shares of common stock beneficially owned by a person and the percentage ownership
of that person, we deemed to be outstanding all shares of common stock subject to options, warrants, rights or other convertible
securities held by that person that are currently exercisable or will be exercisable within 60 days after such date. We did not
deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person. Except as otherwise
noted, the address for each person listed in the table below is c/o BioTime, Inc., 1010 Atlantic Avenue, Suite 102, Alameda, CA
94501.
Security
Ownership of 5% Beneficial Owners
|
|
Number of Shares
|
|
|
Percent of Total
|
|
Neal C. Bradsher
(1)
Broadwood Partners, L.P.
Broadwood Capital, Inc.
724 Fifth Avenue, 9
th
Floor
New York, NY 10019
|
|
|
34,142,614
|
|
|
|
22.8
|
%
|
(1)
|
Includes
33,980,826 shares owned by Broadwood Partners, L.P., 62,908 shares owned by Neal C. Bradsher, and 98,880 shares that may be
acquired by Mr. Bradsher upon the exercise of certain stock options that are presently exercisable or may become exercisable
within 60 days. Broadwood Capital, Inc. is the general partner of Broadwood Partners, L.P., and Mr. Bradsher is the President
of Broadwood Capital, Inc. Mr. Bradsher and Broadwood Capital, Inc. may be deemed to beneficially own the shares that Broadwood
Partners, L.P. owns.
|
Security
Ownership of Directors, Named Executive Officers,
and
all our Current Directors and Executive Officers as a Group
Name
|
|
Number of Shares
|
|
|
Percent of Total
|
|
Neal C. Bradsher (1)
|
|
|
34,142,614
|
|
|
|
22.8
|
%
|
Alfred D. Kingsley (2)
|
|
|
6,915,173
|
|
|
|
4.6
|
%
|
Brian M. Culley (3)
|
|
|
74,531
|
|
|
|
*
|
|
Michael D. West (4)
|
|
|
1,852,351
|
|
|
|
1.2
|
%
|
Aditya P. Mohanty (5)
|
|
|
1,853,641
|
|
|
|
1.2
|
%
|
Russell L. Skibsted (6)
|
|
|
1,147,729
|
|
|
|
*
|
|
Stephana E. Patton (7)
|
|
|
244,641
|
|
|
|
*
|
|
Deborah Andrews (8)
|
|
|
108,880
|
|
|
|
*
|
|
Don M. Bailey (9)
|
|
|
62,647
|
|
|
|
*
|
|
Stephen C. Farrell (8)
|
|
|
196,330
|
|
|
|
*
|
|
Michael H. Mulroy (8)
|
|
|
325,701
|
|
|
|
*
|
|
Cavan Redmond (10)
|
|
|
74,160
|
|
|
|
*
|
|
Angus C. Russell (8)
|
|
|
166,380
|
|
|
|
*
|
|
All executive officers and directors as a group (16 persons) (11)
|
|
|
47,275,623
|
|
|
|
30.6
|
%
|
*
Less than 1%.
(1)
|
Includes
33,980,826 shares owned by Broadwood Partners, L.P., 62,908 shares owned by Neal C. Bradsher, and 98,880 shares that may be
acquired by Mr. Bradsher upon the exercise of certain stock options that are presently exercisable or may become exercisable
within 60 days. Broadwood Capital, Inc. is the general partner of Broadwood Partners, L.P., and Mr. Bradsher is the President
of Broadwood Capital, Inc. Mr. Bradsher and Broadwood Capital, Inc. may be deemed to beneficially own the shares that Broadwood
Partners, L.P. owns.
|
|
|
(2)
|
Includes
834,677 shares (beneficial ownership calculated as 80% of 1,043,346 shares) owned by Greenbelt Corp, 375,351 shares owned
by Greenway Partners, L.P., 5,457,945 shares owned solely by Alfred D. Kingsley, and 247,200 shares that may be acquired by
Mr. Kingsley upon the exercise of certain stock options that are presently exercisable or may become exercisable within 60
days. Mr. Kingsley controls Greenbelt Corp. and Greenway Partners, L.P. and may be deemed to beneficially own the shares that
Greenbelt Corp. and Greenway Partners, L.P. own. Mr. Kingsley beneficially owns 9.7% of the outstanding shares of common stock
of BioTime’s subsidiary LifeMap Sciences Inc., including 523,810 shares owned by Mr. Kingsley and 1,047,620 shares owned
by Greenway Partners, L.P., and 199,750 shares that may be acquired upon the exercise of certain stock options that are presently
exercisable. Mr. Kingsley currently has options to purchase common shares or ordinary shares of certain BioTime subsidiaries,
which are presently exercisable or may become exercisable within 60 days, and if exercised would entitle him to acquire: 1.3%
of the outstanding shares of BioTime Asia; 1.2% of the outstanding shares of OrthoCyte Corporation; and less than 1% of the
outstanding shares of other subsidiaries.
|
|
|
(3)
|
Includes
74,531 shares owned by Mr. Culley.
|
|
|
(4)
|
Includes
957,897 shares that may be acquired upon the exercise of certain stock options that are presently exercisable or that
may become exercisable within 60 days. Dr. West currently has options to purchase common shares or ordinary shares of certain
BioTime subsidiaries, which are presently exercisable or may become exercisable within 60 days, and if exercised would entitle
Dr. West to acquire: 2.6% of the outstanding shares of BioTime Asia; 2.3% of the outstanding shares of OrthoCyte Corporation;
and less than 1% of the outstanding shares of other subsidiaries.
|
|
|
(5)
|
Includes
1,669,901 shares that may be acquired upon the exercise of certain options that are presently exercisable or that may
become exercisable within 60 days.
|
|
|
(6)
|
Includes
1,112,397 shares that may be acquired upon the exercise of certain options that are presently exercisable or that may
become exercisable within 60 days.
|
|
|
(7)
|
Includes
196,342 shares that may be acquired upon the exercise of certain options that are presently exercisable or that may
become exercisable within 60 days.
|
|
|
(8)
|
Includes
98,880 shares that may be acquired upon the exercise of certain options that are presently exercisable or that may
become exercisable within 60 days.
|
|
|
(9)
|
Includes
62,647 shares owned by Mr. Bailey.
|
|
|
(10)
|
Includes
74,160 shares that may be acquired upon the exercise of certain options that are presently exercisable or that may become
exercisable within 60 days.
|
|
|
(11)
|
Includes
4,834,697 shares that may be acquired upon the exercise of certain options that are presently exercisable or that may
become exercisable within 60 days.
|
Equity
Compensation Plan Information
The
following table shows certain information concerning the options outstanding and available for issuance under all of our compensation
plans and agreements as of December 31, 2018 (in thousands, except weighted average exercise prices):
Plan Category
|
|
Number of Shares to be Issued Upon Exercise of Outstanding Options and Vesting of Restricted Stock Units, and Rights
|
|
|
Weighted Average Exercise Price of the Outstanding Options, and Rights
|
|
|
Number of Shares Remaining Available for Future Issuance under Equity Compensation Plans
|
|
Equity Compensation Plans Approved by Shareholders
|
|
|
14,269
|
|
|
$
|
2.44
|
|
|
|
1,885
|
|
Equity Compensation Plans Not Approved by Shareholders
|
|
|
1,854
|
|
|
$
|
1.87
|
|
|
|
N/A
|
|
The
following table shows certain information concerning the options outstanding and available for issuance under all of our compensation
plans and agreements for our consolidated subsidiary companies as of December 31, 2018 (in thousands, except weighted average
exercise prices):
Plan Category
|
|
Number of Shares to be Issued Upon Exercise of Outstanding Options and Vesting of Restricted Stock Units, and Rights
|
|
|
Weighted Average Exercise Price of the Outstanding Options, and Rights
|
|
|
Number of Shares Remaining Available for Future Issuance under Equity Compensation Plans
|
|
OrthoCyte Equity Compensation Plans Approved by Shareholders (1)
|
|
|
1,249
|
|
|
$
|
0.06
|
|
|
|
2,700
|
|
BioTime Asia Equity Compensation Plans Approved by Shareholders (1)
|
|
|
300
|
|
|
$
|
0.01
|
|
|
|
1,300
|
|
(1)
|
BioTime
is the majority shareholder.
|
Additional
information concerning our 2012 Equity Incentive Plan may be found in Note 13 to the Consolidated Financial Statements in our
Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 14, 2019.
ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Related
Transactions
Since
July 1, 2009, Alfred D. Kingsley has made available to us the use of approximately 900 square feet of office space in New York
City. We pay the office building owner $5,050 per month for the use of the space.
Shared
Facilities and Services Agreement with OncoCyte and AgeX
During
2018 and 2017, we invoiced OncoCyte $1.6 million each year for certain “Use Fees” and other charges under the terms
of a Shared Facilities and Services Agreement (the “Shared Facilities Agreement”) between BioTime and OncoCyte. Under
the Shared Facilities Agreement, BioTime allows OncoCyte to use BioTime’s premises and equipment located at Alameda, California
for the sole purpose of conducting business. BioTime also provides accounting, billing, bookkeeping, payroll, treasury, payment
of accounts payable, and other similar administrative services to OncoCyte. BioTime may also provide the services of attorneys,
accountants, and other professionals who may also provide professional services to BioTime and its other subsidiaries. BioTime
also has provided OncoCyte with the services of laboratory and research personnel, including BioTime employees and contractors,
for the performance of research and development work for OncoCyte at the premises.
BioTime
charges OncoCyte a “Use Fee” for services provided and usage of BioTime facilities, equipment, and supplies. For each
billing period, BioTime prorates and allocates to OncoCyte costs incurred, including costs for services of BioTime employees and
use of equipment, insurance, leased space, professional services, software licenses, supplies and utilities. The allocation of
costs depends on key cost drivers, including actual documented use, square footage of facilities used, time spent, costs incurred
by BioTime for OncoCyte, or upon proportionate usage by BioTime and OncoCyte, as reasonably estimated by BioTime. BioTime, at
its discretion, has the right to charge OncoCyte a 5% markup on such allocated costs. In addition to the Use Fees, OncoCyte will
reimburse BioTime for any out of pocket costs incurred by BioTime for the purchase of office supplies, laboratory supplies, and
other goods and materials and services for the account or use of OncoCyte.
BioTime
entered into a similar Shared Facilities Agreement with AgeX in 2018 and we invoiced them $0.6 million for
Use Fees and expenses for that period.
BioTime
also had a similar Shared Facilities Agreement with Asterias and during 2017 we invoiced Asterias $0.1 million for Use Fees and
expenses. This Agreement did not extend into 2018.
Our
Chairman, Alfred D. Kingsley, and Neal Bradsher, an officer of Broadwood Partners, L.P., were directors of Asterias prior to our
acquisition of Asterias on March 8, 2019. All of our directors and executive officers, and beneficial owners of more than 5% of
our outstanding common stock (“5% Shareholders”) as reported in this Amendment No. 1 on Form 10-K, in the aggregate
beneficially owned approximately 10.2% of the outstanding shares of Asterias common stock as of December 31, 2018, and
approximately 10.2% of the outstanding shares of Asterias common stock immediately prior to the acquisition on March 8,
2019.
Mr.
Kingsley and Mr. Redmond are directors of OncoCyte. Broadwood beneficially owns more than 10% of the outstanding common stock
of OncoCyte, and all of our directors and executive officers and 5% Shareholders as reported in this Amendment No. 1 on Form 10-K,
including Mr. Bradsher who may be deemed to beneficially own the shares owned by Broadwood, in the aggregate beneficially own
approximately 18.9% of the
outstanding
shares of OncoCyte common stock as of April 22, 2019. The fact that certain of our executive officers and directors own shares
of OncoCyte common stock should not be considered to mean that they constitute or are acting in concert as a “group”
with respect to those shares or that they otherwise share power or authority to vote or dispose of the shares that each of them
own.
Related
Person Transaction Policy
We
have adopted a Related Person Transaction Policy that applies to transactions exceeding $120,000 in which any of our officers,
directors, beneficial owners of more than 5% of our common shares, or any member of their immediate family, has a direct or indirect
material interest, determined in accordance with the policy (a “Related Person Transaction”). A Related Person Transaction
must be reported to our outside legal counsel, our Chief Operating Officer, and our Chief Financial Officer, and will be subject
to review and approval by our Audit Committee prior to effectiveness or consummation, to the extent practical. In addition, any
Related Person Transaction that is ongoing in nature will be reviewed by the Audit Committee annually to ensure that the transaction
has been conducted in accordance with any previous approval and that all required disclosures regarding the transaction are made.
As
appropriate for the circumstances, the Audit Committee will review and consider:
|
●
|
the
interest of the officer, director, beneficial owner of more than 5% of our common shares, or any member of their immediate
family (“Related Person”) in the Related Person Transaction;
|
|
|
|
|
●
|
the
approximate dollar value of the amount involved in the Related Person Transaction;
|
|
|
|
|
●
|
the
approximate dollar value of the amount of the Related Person’s interest in the transaction without regard to the amount
of any profit or loss;
|
|
|
|
|
●
|
whether
the transaction was undertaken in the ordinary course of our business;
|
|
|
|
|
●
|
whether
the transaction with the Related Person is proposed to be, or was, entered into on terms no less favorable to us than terms
that could have been reached with an unrelated third party;
|
|
|
|
|
●
|
the
purpose of, and the potential benefits to the transaction to us; and
|
|
|
|
|
●
|
any
other information regarding the Related Person Transaction or the Related Person in the context of the proposed transaction
that would be material to investors in light of the circumstances of the particular transaction.
|
The
Audit Committee will review all relevant information available to it about a Related Person Transaction. The Audit Committee may
approve or ratify the Related Person Transaction only if the Audit Committee determines that, under all of the circumstances,
the transaction is in, or is not in conflict with, our best interests. The Audit Committee may, in its sole discretion, impose
such conditions as it deems appropriate on us or the Related Person in connection with approval of the Related Person Transaction.
A
copy of our Related Person Transaction Policy can be found on our website at
www.biotimeinc.com
.
Director
Independence
Our
Board has determined that Deborah Andrews, Don M. Bailey, Neal C. Bradsher, Stephen C. Farrell, Michael H. Mulroy, Cavan Redmond,
and Angus C. Russell qualify as “independent” in accordance with Section 803(A) of the NYSE American Company Guide.
The members of our Audit Committee meet the additional independence standards under Section 803(B)(2) of the NYSE American Company
Guide and Section 10A-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the members
of our Compensation Committee meet the additional independence standards under Section 805(c)(1) of the NYSE American Company
Guide. Our independent directors received no compensation or remuneration for serving as directors except as disclosed under “Director
Compensation” in Item 11. None of these directors, nor any of the members of their families, have participated in any transaction
with us that would disqualify them as “independent” directors under the standards described above.
ITEM
14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The
following table shows the fees billed by OUM & Co. LLP or OUM, our principal accountant, for the audit of our annual consolidated
financial statements for our last two fiscal years and for other services rendered by OUM during our last two fiscal years.
|
|
2018
|
|
|
2017
|
|
Audit Fees
(1)
|
|
$
|
604,000
|
|
|
$
|
945,000
|
|
Audit Related Fees
(2)
|
|
|
28,000
|
|
|
|
40,000
|
|
Total Fees
|
|
$
|
632,000
|
|
|
$
|
985,000
|
|
|
(1)
|
Audit
Fees consist of fees billed for professional services rendered for the audit of the consolidated annual financial statements
of BioTime and its several subsidiaries included in our Annual Report on Form 10-K, the reviews of the interim consolidated
financial statements included in our Quarterly Reports on Form 10-Q, and services that are normally provided by our
independent registered public accountants in connection with statutory and regulatory filings or engagements. Fees in
the table include amounts of $92,000 and $450,000 paid for AgeX by BioTime for 2018 and 2017,
respectively. 2017 fees for AgeX included fees paid for its 2016 audit as well as its 2017 audit as it was a
newly registered public company in 2018 and was required to have an audited beginning balance sheet for
2017.
|
|
|
|
|
(2)
|
Audit-Related
Fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit
or review of BioTime’s consolidated financial statements and are not reported under “Audit Fees.” This category
includes fees related to non-routine SEC filings.
|
Pre-Approval
of Audit and Permissible Non-Audit Services
Our
Audit Committee requires pre-approval of all audit and non-audit services. Other than
de minimis
services incidental to
audit services, non-audit services shall generally be limited to tax services such as advice and planning and financial due diligence
services. All fees for such non-audit services must be approved by the Audit Committee, except to the extent otherwise permitted
by applicable SEC regulations. The Committee may delegate to one or more designated members of the Committee the authority to
grant pre-approvals, provided such approvals are presented to the Committee at a subsequent meeting.