UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A
Proxy
Statement Pursuant to Section 14(a) (Rule 14a-101) of the
Securities Exchange Act of 1934
Filed
by the Registrant ☒
Filed
by a Party other than the Registrant ☐
Check
the appropriate box:
☐ |
Preliminary Proxy Statement |
☐ |
Confidential, for Use of the
Commission Only (as permitted by Rule 14a-6(e)(2)) |
☒ |
Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Pursuant to §240.14a-12 |
Celcuity
Inc.
(Name
of Registrant as Specified in its Charter)
(Name
of Person(s) Filing Proxy Statement, if Other Than the
Registrant)
Payment
of Filing Fee (Check the appropriate box):
☒ |
No fee required. |
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Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11. |
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number of securities to which transaction applies: |
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Per
unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was
determined): |
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(4) |
Proposed
maximum aggregate value of transaction: |
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Fee paid previously with preliminary materials. |
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Check
box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date
of its filing. |
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Amount Previously Paid: |
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Form,
Schedule or Registration Statement No.: |
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CELCUITY
INC.
16305
36th Avenue North, Suite 100
Minneapolis,
MN 55446
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 11, 2023
TO
THE STOCKHOLDERS OF CELCUITY INC.:
Please Take Notice that
Celcuity Inc. (“Celcuity”) will hold its 2023 Annual Meeting of
Stockholders at the offices of Celcuity Inc., 16305 36th
Avenue North, Suite 100, Minneapolis, MN 55446, on May 11, 2023 at
9:00 a.m. local time. Celcuity is holding this meeting for the
purpose of considering and taking appropriate action with respect
to the following:
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1. |
To
elect the seven director nominees named in the Proxy Statement to
the Celcuity Board of Directors, to serve until the earlier of the
next annual meeting of stockholders, the election of such
director’s successor, or such director’s death, resignation or
removal; |
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2. |
To
ratify the appointment of Boulay PLLP as Celcuity’s independent
registered public accounting firm for the year ending December 31,
2023; |
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3. |
To
approve, on an advisory basis, named executive officer (NEO)
compensation; |
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4. |
To
approve a 1,500,000 share increase to the Celcuity Inc. Amended and
Restated 2017 Stock Incentive Plan; and |
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5. |
To
transact any other business as may properly come before the meeting
or any adjournments thereof, including matters incident to the
conduct of the meeting. |
Holders
of record of Celcuity common stock at the close of business on
March 14, 2023 will be entitled to vote at the meeting or any
adjournments thereof. Your attention is directed to the Proxy
Statement accompanying this Notice for a more complete statement of
the matters to be considered at the meeting. A copy of the Annual
Report on Form 10-K for the year ended December 31, 2022 also
accompanies this Notice.
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By Order of the Board of Directors, |
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/s/ Brian F.
Sullivan |
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Chairman of the Board of Directors and |
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Date: March 31, 2023 |
Chief Executive Officer |
Your
vote is important. To vote your shares, please vote by telephone or
Internet, as directed in the Proxy Statement, or if you received a
proxy card or voting instruction form by mail, please complete,
sign, date and mail the proxy card or voting instruction form
promptly in the envelope provided. The prompt return of proxies
will save Celcuity the expense of further requests for
proxies.
IMPORTANT
NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL
MEETING OF STOCKHOLDERS TO BE HELD ON MAY 11, 2023:
This
Notice, the Proxy Statement, and the Annual Report on Form 10-K are
available at www.proxyvote.com and on the Investor Relations
section of Celcuity’s website at
www.celcuity.com/home/investors/.
CELCUITY
INC.
16305
36th Avenue North, Suite 100
Minneapolis,
MN 55446
PROXY
STATEMENT
2023
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 11, 2023
This
Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors (the “Board”) of Celcuity Inc., a
Delaware corporation (“Celcuity,” the “Company,” “we,” “our” or
“us”), for use at the 2023 Annual Meeting of Stockholders (the
“Annual Meeting”) to be held at the Celcuity corporate offices,
16305 36th Avenue North, Suite 100, Minneapolis, MN
55446, at 9:00 a.m. local time on May 11, 2023.
Purposes
of the Annual Meeting
The
purposes of the Annual Meeting are:
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1. |
To
elect the seven director nominees named in this Proxy Statement to
the Celcuity Board of Directors, to serve until the earlier of the
next annual meeting of stockholders, the election of such
director’s successor, or such director’s death, resignation or
removal; |
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2. |
To
ratify the appointment of Boulay PLLP as Celcuity’s independent
registered public accounting firm for the year ending December 31,
2023; |
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3. |
To
approve, on an advisory basis, named executive officer
compensation; |
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4. |
To
approve a 1,500,000 share increase to the Celcuity Inc. Amended and
Restated 2017 Stock Incentive Plan; and |
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5. |
To
transact any other business as may properly come before the Annual
Meeting or any adjournments thereof, including matters incident to
the conduct of the Annual Meeting. |
Action
may be taken on any one of the foregoing proposals on the date
specified above for the Annual Meeting, or on any date or dates to
which the Annual Meeting may be adjourned.
Notice
and Access Delivery
In
accordance with rules and regulations adopted by the U.S.
Securities and Exchange Commission (the “SEC”), we have elected to
provide our beneficial owners and stockholders of record access to
our proxy materials over the Internet. Beneficial owners are
stockholders whose shares are held in the name of a broker, bank,
or other nominee (i.e., in “street name”). Accordingly, a Notice of
Internet Availability of Proxy Materials (the “Notice”) will be
mailed on or about March 31, 2023 to our beneficial owners and
stockholders of record who owned our common stock at the close of
business on March 14, 2023. Beneficial owners and stockholders of
record will have the ability to access the proxy materials on a
website referred to in the Notice or to request a printed set of
the proxy materials be sent to them by following the instructions
in the Notice. Beneficial owners and stockholders of record who
have previously requested to receive paper copies of our proxy
materials will receive paper copies of the proxy materials instead
of a Notice.
You
can choose to receive our future proxy materials electronically by
visiting www.proxyvote.com. Your choice to receive proxy materials
electronically will remain in effect until you instruct us
otherwise by following the instructions contained in your Notice
and visiting www.proxyvote.com, sending an email to
sendmaterial@proxyvote.com, or calling 1-800-579-1639.
Solicitation
This
solicitation is made by Celcuity, and Celcuity will pay the cost of
soliciting proxies for the Annual Meeting. In addition to
soliciting proxies by mail, we may solicit proxies personally or by
telephone, email, facsimile or other means of communication by our
directors, officers and employees. These persons will not
specifically be compensated for these activities, but they may be
reimbursed for reasonable out-of-pocket expenses in connection with
this solicitation. We will not specifically engage any employees or
paid solicitors for the purpose of soliciting proxies for the
Annual Meeting. We will arrange with brokerage firms and other
custodians, nominees and fiduciaries to forward solicitation
materials to the beneficial owners of shares held of record by
these persons. We will reimburse these brokerage firms, custodians,
nominees and fiduciaries for reasonable out-of-pocket expenses
incurred by them in connection with this solicitation.
Record
Date and Shares Outstanding
Only
holders of record of our common stock at the close of business on
March 14, 2023 will be entitled to vote at the Annual Meeting or
any adjournments thereof. As of March 14, 2023, there were
21,689,425 shares of our common stock outstanding and entitled to
vote. Each share of common stock entitles the holder thereof to one
vote upon each matter to be presented at the Annual
Meeting.
If
you are a stockholder of record, you may vote in person at the
Annual Meeting, vote by proxy using the enclosed proxy card (if you
received paper copies of the proxy materials), vote by proxy over
the telephone, or vote by proxy over the Internet. Whether or not
you plan to attend the Annual Meeting, we urge you to vote by proxy
to ensure your vote is counted. You may still attend the Annual
Meeting and vote in person even if you have already voted by
proxy.
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To
vote in person, come to the Annual Meeting and we will give you a
ballot when you arrive. |
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If
you received paper copies of the proxy materials, to vote using the
proxy card, simply complete, sign and date the enclosed proxy card
and return it promptly in the envelope provided. If you return your
signed proxy card to us before the Annual Meeting, we will vote
your shares as you direct. |
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To
vote over the telephone, dial toll-free 1-800-690-6903 using a
touch-tone phone and follow the recorded instructions. Please have
available the 16-Digit Control Number from the enclosed proxy card,
if you received one, or from your Notice. Your vote must be
received by 11:59 p.m., Eastern Time (10:59 p.m., Central Time) on
May 10, 2023, to be counted. |
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To
vote over the Internet, go to www.proxyvote.com to complete an
electronic proxy card. Please have available the 16-Digit Control
Number from the enclosed proxy card, if you received one, or from
your Notice. Your vote must be received by 11:59 p.m., Eastern Time
(10:59 p.m., Central Time) on May 10, 2023, to be
counted. |
We
are providing Internet proxy voting to allow you to vote your
shares online, with procedures designed to ensure the authenticity
and correctness of your proxy vote instructions. However, please be
aware that you must bear any costs associated with your Internet
access, such as usage charges from Internet access providers and
telephone companies.
If
you are a beneficial owner of shares registered in the name of your
broker, bank, or other nominee, you may have received a proxy card
and voting instructions with these proxy materials from that
organization rather than from us. Simply complete and mail the
proxy card to ensure that your vote is submitted to your broker.
Alternatively, you may vote by telephone or over the Internet as
instructed by your broker. To vote in person at the Annual Meeting,
you must obtain a valid proxy from your broker. Follow the
instructions from your broker included with these proxy materials
or contact your broker to request a proxy form.
Quorum
A
quorum, consisting of a majority of the outstanding shares of our
common stock entitled to vote at the Annual Meeting, must be
present in person or by proxy before any action can be taken by the
stockholders at the Annual Meeting. Abstentions and withheld votes
are counted as present and entitled to vote for purposes of
determining a quorum.
If
you are a beneficial owner of shares registered in the name of your
broker, bank, or other nominee, such shares may be voted by the
broker on “routine” matters, which includes ratification of the
appointment of our independent registered public accounting firm
(Proposal 2). All other proposals in this Proxy Statement are
considered “non-routine.” Your broker will not be able to vote your
shares on non-routine matters being considered at the Annual
Meeting unless you have given instructions to your broker prior to
the Annual Meeting on how to vote your shares. When the broker does
not obtain direction to vote the shares, the broker’s abstention is
referred to as a “broker non-vote.” Broker non-votes will be
considered present for quorum purposes at the Annual
Meeting.
So
long as a quorum is present at the beginning of the Annual Meeting,
the stockholders present may continue to transact business until
adjournment, even if enough stockholders have left the Annual
Meeting to leave less than a quorum, and even if any stockholder
present in person or by proxy refuses to vote or participate in the
Annual Meeting. If the Annual Meeting is adjourned for any reason,
the approval of the proposals may be considered and voted upon by
stockholders at the subsequent reconvened meeting. All proxies will
be voted in the same manner as they would have been voted at the
original Annual Meeting except for any proxies that have been
properly withdrawn or revoked.
Board
Recommendation and Voting of Proxies
The
Board recommends a vote:
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FOR
the election of each of the director nominees (Proposal
1). |
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FOR
the ratification of the appointment of Boulay PLLP as our
independent registered public accounting firm for the year ending
December 31, 2023 (Proposal 2). |
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FOR
the approval, on an advisory basis, of named executive officer
compensation (Proposal 3). |
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FOR
the approval of a 1,500,000 share increase to the Celcuity Inc.
Amended and Restated 2017 Stock Incentive Plan (Proposal
4). |
If
you complete and submit your proxy before the Annual Meeting, the
persons named as proxy agents will vote the shares represented by
your proxy in accordance with your instructions. If you submit a
proxy without giving voting instructions, your shares will be voted
in the manner recommended by the Board on all matters presented in
this Proxy Statement. If any other matters are properly presented
for consideration at the Annual Meeting, including, among other
things, consideration of a motion to adjourn the Annual Meeting to
another time or place (including, without limitation, for the
purpose of soliciting additional proxies), the persons named as
proxy agents will have discretion to vote on those matters in
accordance with their best judgment. We do not currently anticipate
that any other matters will be raised at the Annual
Meeting.
Vote
Required
For
the election of directors, you have the option to vote “For” or
“Withhold” authority to vote for any of the director nominees.
Assuming a quorum is present, a plurality of the votes cast is
required for the election of directors. This means that the seven
director nominees with the most votes will be elected. If you
“Withhold” authority to vote on any or all nominees, your vote will
have no effect on the outcome of the election. If you hold your
shares in “street name” and do not provide instructions to your
broker, your broker will not have discretionary authority with
respect to the proposal to elect directors and will therefore
provide a “broker non-vote.” Since broker non-votes are not deemed
votes cast, they will have no effect on the outcome of the
election.
For
the ratification of the appointment of Boulay PLLP as our
independent registered public accounting firm, you have the option
to vote “For,” “Against” or “Abstain” from voting. Assuming a
quorum is present, the affirmative vote of a majority of the shares
of common stock of Celcuity represented at the Annual Meeting,
either in person or by proxy, and entitled to vote is required to
ratify the appointment of Boulay PLLP as our independent registered
public accounting firm. If you “Abstain” from voting with respect
to this proposal, your shares will be counted as present and
entitled to vote and your vote will have the same effect as a vote
against the proposal. If you hold your shares in “street name” and
do not provide instructions to your broker, your broker will have
discretionary authority to vote your shares with respect to this
proposal.
For
the approval, on an advisory basis, of the compensation of our
named executive officers, you have the option to vote “For,”
“Against” or “Abstain” from voting. Assuming a quorum is present,
the affirmative vote of a majority of the shares of common stock of
Celcuity represented at the Annual Meeting, either in person or by
proxy, and entitled to vote is required to approve the compensation
of our named executive officers. If you mark “Abstain” from voting
with respect to this proposal, your shares will be counted as
present and entitled to vote and your vote will have the same
effect as a vote against the proposal. If you hold your shares in
“street name” and do not provide instructions to your broker, your
broker will not have discretionary authority to vote your shares
with respect to this proposal and will therefore provide a “broker
non-vote.” Since broker non-votes are not deemed present and
entitled to vote on this proposal, they will have no effect on the
outcome of the proposal. The vote on approval of the compensation
of our named executive officers is an advisory vote, which means
that the result of the vote is not binding on the Company, our
Board or the Compensation Committee. To the extent there is any
significant vote against our named executive officer compensation
as disclosed in this Proxy Statement, the Board and the
Compensation Committee will evaluate whether any actions are
necessary to address the concerns of stockholders.
For
the approval of the 1,500,000 share increase to the Celcuity Inc.
Amended and Restated 2017 Stock Incentive Plan, you have the option
to vote “For,” “Against” or “Abstain” from voting. Assuming a
quorum is present, the affirmative vote of a majority of the shares
of common stock of Celcuity represented at the Annual Meeting,
either in person or by proxy, and entitled to vote is required to
approve the 1,500,000 share increase to the Celcuity Inc. Amended
and Restated 2017 Stock Incentive Plan. If you “Abstain” from
voting with respect to this proposal, your shares will be counted
as present and entitled to vote and your vote will have the same
effect as a vote against the proposal. If you hold your shares in
“street name” and do not provide instructions to your broker, your
broker will not have discretionary authority to vote your shares
with respect to this proposal and will therefore provide a “broker
non-vote.” Since broker non-votes are not deemed votes cast, they
will have no effect on the outcome of the proposal.
Revocability
of Proxies
Any
person giving a proxy for the Annual Meeting has the power to
revoke it at any time before it is voted. If you are a record
holder of your shares, you may revoke your proxy in any one of the
following ways: (1) sending a written notice of revocation dated
after the date of the proxy to our Corporate Secretary, Celcuity
Inc., 16305 36th Avenue North, Suite 100, Minneapolis,
MN 55446; (2) submitting a properly signed proxy with a later date;
(3) submitting a new vote by telephone or Internet; or (4)
attending the Annual Meeting and voting in person. Attendance at
the Annual Meeting will not, in and of itself, constitute a
revocation of a proxy.
If
you are a beneficial owner of shares registered in the name of your
broker, bank, or other nominee, you must contact them in order to
find out how to revoke your proxy.
Householding
The SEC has adopted rules that permit companies and brokers, banks
and other nominees to satisfy the delivery requirements for proxy
statements and annual reports, with respect to two or more
stockholders sharing the same address and who do not participate in
electronic delivery of proxy materials, by delivering a single copy
of such documents addressed to those stockholders. This process,
which is commonly referred to as “householding,” potentially means
extra convenience for stockholders and cost savings for
companies.
Brokers, banks and other nominees may be “householding” Company
proxy materials. This means that only one copy of the proxy
materials may have been sent to multiple stockholders in a
household. If, at any time, you no longer wish to participate in
householding and would prefer to receive a separate proxy statement
and annual report from the other stockholder(s) sharing your
address, please: (i) notify your broker, bank or other nominee,
(ii) direct your written request to our Chief Financial Officer,
Celcuity Inc., 16305 36th Avenue North, Suite 100, Minneapolis, MN
55446, or (iii) contact us at (763) 392-0123. The Company will
undertake to deliver promptly, upon any such oral or written
request, a separate copy of the proxy materials to a stockholder at
a shared address to which a single copy of these documents was
delivered. Stockholders who currently receive multiple copies of
proxy materials at their address and would like to request
householding of their communications should notify their broker,
bank or other nominee, or contact us at the above address or phone
number.
Other
Business
Our
Board currently has no knowledge of any matters to be presented at
the Annual Meeting other than those referred to in this Proxy
Statement. The solicited proxies give discretionary authority to
the proxy agents named therein to vote in accordance with the
recommendation of the Board if any other matters are
presented.
FINANCIAL
INFORMATION
Our
2022 Annual Report on Form 10-K filed with the SEC, including, but
not limited to, the balance sheets and the related statements of
operations, changes in stockholders’ equity and cash flows for
Celcuity as of and for the years ended December 31, 2022 and 2021
accompanies these materials. A copy of the 2022 Annual Report on
Form 10-K may be obtained without charge upon request to our Chief
Financial Officer, Celcuity Inc., 16305 36th Avenue
North, Suite 100, Minneapolis, MN 55446. Our 2022 Annual Report on
Form 10-K is also available on our website at
www.celcuity.com/home/investors/sec-filings/.
PROPOSAL
NO. 1
ELECTION OF DIRECTORS
Celcuity’s
business and affairs are managed under the direction of the Board.
All our directors are elected at each annual meeting to serve until
their successors are duly elected or until their earlier death,
resignation or removal. If any of the nominees for director at the
Annual Meeting becomes unavailable for election for any reason
(none being presently known), the proxy agents will have
discretionary authority to vote, pursuant to the proxies, for a
suitable substitute or substitutes selected in accordance with the
best judgment of the proxy agents.
Nominees
for Election
The
Board, upon the recommendation of the Nominating and Corporate
Governance Committee, has nominated the seven persons named in the
table below for election as directors at the Annual Meeting. Each
nominee listed below currently serves as a director of
Celcuity.
Name of Nominee |
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Age |
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Position Held with Celcuity Inc. |
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Director Since |
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Richard E. Buller |
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73 |
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Director |
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2019 |
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David F. Dalvey |
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64 |
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Director |
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2014 |
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Leo T. Furcht |
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76 |
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Director |
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2019 |
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Lance G. Laing |
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61 |
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Director, Chief Science Officer,
Vice President, and Secretary |
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2012 |
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Polly A. Murphy |
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58 |
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Director |
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2022 |
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Richard J. Nigon |
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75 |
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Director |
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2017 |
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Brian F. Sullivan |
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61 |
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Chairman of the Board and Chief
Executive Officer |
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2012 |
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The
Board has determined that each of Richard E. Buller, David F.
Dalvey, Leo T. Furcht, Polly A. Murphy, and Richard J. Nigon
qualifies as an independent director under the rules of the Nasdaq
Stock Market (the “Nasdaq Listing Rules”). Accordingly, the Board
is and will be composed of a majority of independent
directors.
Set
forth below with respect to each director nominee standing for
election at the Annual Meeting is each nominee’s principal
occupation and business experience during at least the past five
years, the names of other publicly-held companies for which such
nominee serves or has served as a director during such period, and
the experience, qualifications, attributes or skills that has led
the Board to conclude that each nominee should serve as a director
of the Company.
Richard
E. Buller, M.D., Ph.D., was appointed to Celcuity’s Board in
December 2019. Dr. Buller has over 15 years of experience leading
oncology clinical development and translational medicine
departments at major pharmaceutical companies. He has participated
in the development of 15 drugs and several companion diagnostics
that received U.S. FDA approval. Dr. Buller most recently served as
Head Oncology Clinical Development and Vice President of
Translational Oncology at Pfizer, Inc, one of the world’s largest
pharmaceutical companies, until he retired in 2016. He had
previously served as Vice President of Translational Medicine at
Exelixis, a leading biopharmaceutical company, where he led efforts
to study patients selected by molecular testing for inclusion in
their phase 2 and phase 3 clinical trials. He began his
pharmaceutical company career at GlaxoSmithKline as Director of the
Oncology Medicine Development Center. Prior to his leadership
positions in drug development, he was Professor of Gynecologic
Oncology at the University of Iowa, where he led laboratory
research focused on identifying genomic variants involved in
ovarian cancer. He received his M.D. from the Baylor College of
Medicine, where he also received his Ph.D. in cell biology. Among
other attributes, skills, and qualifications, the Board believes
Dr. Buller is uniquely qualified to serve as a director based on
his oncology drug and diagnostic development expertise.
David
F. Dalvey has served as a member of Celcuity’s Board since
February 2014. Mr. Dalvey has more than 30 years of experience in
the fields of corporate finance and venture capital, working
primarily with growth-oriented technology and life-science
businesses. He has over 10 years of corporate finance advisory
experience with two national investment banks, completing over 150
individual transactions. He has been the General Partner of
Brightstone Venture Capital, a venture capital management company
since September 2000. Brightstone is a 25-year old venture capital
management company that has raised and managed ten venture
partnerships. Previously, he held management positions with R.J.
Steichen and Company, an investment bank, from 1995 to 2000, The
Food Fund LP, a venture capital firm, from 1992 to 1995 and
Wessels, Arnold & Henderson, an investment bank, from 1987 to
1992. Mr. Dalvey served on the board of directors for Navarre
Corporation (now Speed Commerce, Inc.) from 2009 until November
2012, on the board of managers for Blue Rock Market Neutral Fund, a
mutual fund registered under the Investment Company Act of 1940,
from 2000 to 2014 and on the board of directors for Digitiliti,
Inc. from July 2011 until October 2012. Mr. Dalvey has significant
operational exposure as a board director or advisor to many other
public and privately held growth businesses and has served on these
companies’ audit, strategic or governance committees, including
companies such as HomeSpotter, Definity Health, AppTec
Laboratories, CHF Solutions, BiteSquad, Agiliti, and Nature Vision.
Mr. Dalvey received a B.S. in Business/Management Economics from
University of Minnesota. Among other attributes, skills, and
qualifications, the Board believes Mr. Dalvey is uniquely qualified
to serve as a director based on his leadership experience in
operating both public and private companies and his experience
working in the investment community and with investment firms,
which enable him to bring valuable insight and knowledge to our
Board.
Leo
T. Furcht, M.D., was appointed to Celcuity’s Board in May 2019.
Dr. Furcht is currently Allen-Pardee Professor of Cancer Biology
and Head of the Department of Laboratory Medicine and Pathology at
the University of Minnesota and a member of the Division of
Molecular Pathology and Genomics. He served as Chairman of the
Board of Directors for University of Minnesota Physicians, the
Medical School practice plan with approximately 700 physicians,
from 2004-2014. He was also the founding Director of the Biomedical
Engineering Center from 1990-2001, where he led efforts to
establish stem cell and molecular diagnostics expertise at the
University of Minnesota. He has published more than 180 scientific
papers and holds more than 30 patents in the fields of
polypeptides, biomaterials, and adult stem cells. His business
experience includes co-founding two medical technology companies,
South Bay Medical, a medical device company that was acquired by
Mentor Corporation, and Diascreen, a diagnostics company, which was
later acquired by Chronimed. Among other attributes, skills, and
qualifications, the Board believes Dr. Furcht is uniquely qualified
to serve as a director based on his research in tumor cell behavior
and extracellular matrix proteins, his role as Head of the
University of Minnesota’s Department of Laboratory Medicine and
Pathology, and his experience in several biotechnology
start-ups.
Lance
G. Laing, Ph.D. is our co-founder and has served as Chief
Science Officer, Vice President, Secretary and a director since we
commenced operations in 2012. Dr. Laing’s career spans more than 20
years in drug discovery research and technology development. He
received his doctorate in biophysics and biochemistry from The
Johns Hopkins University and completed a National Institutes of
Health post-doctoral fellowship at Washington University Medical
School. He has received 24 U.S. patents and has an additional U.S.
patent pending. His drug discovery research career began at
Scriptgen/Anadys Pharmaceuticals (purchased by Novartis), where he
worked under Professor Peter Kim, who became President of Merck
Research. He also was Director of Chemistry and Bioapplications and
Director of Detection Product Development for two companies that
each developed instruments similar to those Celcuity uses to
perform the CELsignia tests. His work at these two instrument
companies gave him unique expertise and experience in developing a
variety of patented applications for these instruments. Most
recently, he served as an executive director for an international
drug discovery and development company. Among other attributes,
skills, and qualifications, the Board believes Dr. Laing is
uniquely qualified to serve as a director based on his significant
research, medical and scientific expertise.
Polly
A. Murphy, D.V.M., Ph.D., was appointed to Celcuity’s Board in
September 2022. Dr. Murphy has served as Chief Business Officer at
UroGen Pharma, Inc. since August 2020. Prior to that, Dr. Murphy
served in various leadership roles at Pfizer, Inc. from September
2012 to August 2020, including as Vice President and Head of
Commercial Development Pfizer Oncology Business Unit from January
2019 to August 2020, Vice President and Head of Global Marketing
and Commercial Development, Pfizer Oncology Business Unit from June
2017 to December 2018, and as Vice President and Head of Strategy
and Business Development for Pfizer China from November 2013 to May
2018. Since August 2020, Dr. Murphy has served on the board of
directors of Atea Pharmaceuticals, Inc., a publicly held company.
Dr. Murphy received her D.V.M. and Ph.D. from Iowa State University
and her M.B.A. from Nova Southeastern University. Among other
attributes, skills, and qualifications, the Board believes Dr.
Murphy is uniquely qualified to serve as a director based on her
extensive experience in strategy, development and commercialization
within the pharmaceutical industry.
Richard
J. Nigon, is currently Senior Vice President of Cedar Point
Capital, LLC., a private company that raises capital for
early-stage companies, where he has served since 2007. Mr. Nigon
has also been a board member for Northern Technologies
International Corp. since February 2010, including serving as its
non-executive Chairman of the board of directors since November
2012. Mr. Nigon also serves as a director of several private
companies. Mr. Nigon previously served as a board member for
Tactile Systems Technology from September 2012 to May 2022,
Vascular Solutions, Inc. from November 2000 to February 2017, when
it was acquired by Teleflex, Incorporated and as a board member for
Virtual Radiologic Corporation from May 2007 until it was acquired
in July 2010. From February 2001 until December 2006, Mr. Nigon was
a Director of Equity Corporate Finance for Miller Johnson Steichen
Kinnard, a privately held investment firm, which was acquired in
December 2006 by Stifel Nicolaus, a brokerage and investment
banking firm. After that acquisition, Mr. Nigon became a Managing
Director of Private Placements of Stifel Nicolaus until May 2007.
From February 2000 to February 2001, Mr. Nigon served as the Chief
Financial Officer of Dantis, Inc., a web hosting company. Prior to
joining Dantis, Mr. Nigon was employed by Ernst & Young LLP
from 1970 to 2000, where he served as a partner from 1981 to 2000.
While at Ernst & Young, Mr. Nigon served as the Director of
Ernst & Young’s Twin Cities Entrepreneurial Services Group and
was the coordinating partner on several publicly-traded companies
in the consumer retailing and manufacturing sectors. Among other
attributes, skills, and qualifications, the Board believes Mr.
Nigon is qualified to serve as a director because of his extensive
public accounting and auditing experience, including experience
with emerging growth companies. The Board also believes that Mr.
Nigon will bring a strong background in financial controls and
reporting, financial management, financial analysis, SEC reporting
requirements, and mergers and acquisitions. His strategic planning
expertise gained through his management and leadership roles at
private investment firms also makes him well-suited to serve as a
member of the Board.
Brian
F. Sullivan is our co-founder and has served as Chairman of the
Board and Chief Executive Officer since we commenced operations in
2012. Mr. Sullivan has over 30 years of experience founding and
building successful, high growth technology companies. He was
Chairman and CEO of SterilMed, a medical device reprocessing
company, from 2003, when he led an investment group to acquire a
majority interest, until its sale to Ethicon Endo-Surgery Inc., a
Johnson & Johnson company, for $330 million in 2011.
Previously, he was co-founder and Chief Executive Officer of
Recovery Engineering, a filtration company, which he took public
and subsequently sold to Procter & Gamble for $265 million in
1999. Since 2003, Mr. Sullivan has served on the board of directors
of Entegris, Inc., a publicly-held company. Mr. Sullivan has
received nine U.S. patents and has several patents pending. He
graduated magna cum laude with distinction from Harvard
College with an A.B. in economics. Among other attributes, skills,
and qualifications, the Board believes Mr. Sullivan is uniquely
qualified to serve as a director based on his extensive operational
and business development experience, and his knowledge in building
stockholder value, growing a company from inception and navigating
significant corporate transactions and the public company
process.
Vote
Required
Assuming
a quorum is present, the affirmative vote of a plurality of the
votes cast at the Annual Meeting is required for the election of
directors.
THE
BOARD OF DIRECTORS RECOMMENDS THAT THE
STOCKHOLDERS VOTE FOR THE SLATE OF NOMINEES NAMED
ABOVE.
PROPOSAL
NO. 2
RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Boulay
PLLP (“Boulay”), an independent registered public accounting firm,
has audited the Company’s financial statements for the years ended
December 31, 2022 and 2021. The Audit Committee appointed Boulay as
the Company’s independent registered public accounting firm for the
year ending December 31, 2023 and has also reviewed and approved
the scope and nature of the services to be performed for Celcuity
by Boulay. Representatives of Boulay are expected to be present at
the Annual Meeting to make a statement if they wish to do so, and
to respond to appropriate stockholder questions. The engagement
agreement entered into with Boulay for 2023 is subject to mediation
and arbitration procedures as the sole method for resolving
disputes.
Ratification
of the appointment of Boulay as the Company’s independent
registered public accounting firm is not required to be submitted
to our stockholders for a vote. The Sarbanes-Oxley Act of 2002
requires the Audit Committee to be directly responsible for the
appointment, compensation and oversight of the audit work of the
independent registered public accounting firm. However, the Board
is submitting this matter to the stockholders for ratification as a
matter of good corporate governance. If the appointment of Boulay
is not ratified by the stockholders at the Annual Meeting, the
Audit Committee may reconsider whether to retain Boulay, and may
retain Boulay or another firm without resubmitting the matter to
the Company’s stockholders. Even if the stockholders vote in favor
of ratification of the appointment, the Audit Committee may, in its
discretion, direct the appointment of a different independent
registered public accounting firm at any time during the year if it
determines that such a change would be in the best interests of the
Company and the stockholders.
Representatives
of Boulay regularly attend meetings of the Audit Committee. The
Audit Committee pre-approves and reviews audit and non-audit
services performed by Boulay, as well as the fees charged by Boulay
for such services. In its pre-approval and review of non-audit
service fees, the Audit Committee considers, among other factors,
the possible effect of the performance of such services on Boulay’s
independence. To avoid potential conflicts of interest, publicly
traded companies are prohibited from obtaining certain non-audit
services, such as bookkeeping or actuarial services, from its
independent registered public accounting firm. In 2022 and 2021, we
did not obtain any of these prohibited services from Boulay. For
additional information concerning the Audit Committee and its
relationship with Boulay, see “Corporate Governance” and “Audit
Committee Report” below.
Audit
and Non-Audit Fees Billed to the Company by Independent Registered
Public Accounting Firm
The
following table summarizes the fees we were billed for audit and
non-audit services rendered by Boulay for 2022 and 2021.
|
|
2022 |
|
|
2021 |
|
Audit Fees |
|
$ |
100,900 |
|
|
$ |
69,068 |
|
Audit-Related Fees |
|
|
- |
|
|
|
- |
|
Tax Fees |
|
|
4,240 |
|
|
|
3,800 |
|
All Other
Fees |
|
|
46,415 |
|
|
|
52,362 |
|
Total |
|
$ |
151,555 |
|
|
$ |
125,230 |
|
Audit
Fees. These fees were for professional services rendered for
2022 and 2021 in connection with the audit of our annual financial
statements and review of the financial statements included in our
Quarterly Reports on Form 10-Q. The amounts also include fees for
services that are normally provided by Boulay in connection with
statutory and regulatory filings and engagements for the years
identified.
Audit-Related
Fees. These fees were for assurance and related services that
were related to the performance of the audit or review of our
financial statements and were not reported under the caption “Audit
Fees.” This category may include fees related to the performance of
audits and attestation services not required by statute or
regulations, or accounting consultations about the application of
generally accepted accounting principles to proposed
transactions.
Tax
Fees. These fees were for tax compliance, tax planning, tax
advice and corporate tax services. Corporate tax services encompass
a variety of permissible services, including technical tax advice
related to tax matters; assistance with withholding-tax matters;
assistance with state and local taxes; preparation of reports to
comply with local tax authority transfer pricing documentation
requirements; and assistance with tax audits.
All
Other Fees. These fees were primarily for services related to
our shelf registration statement and the offerings conducted
thereunder.
Pre-Approval
Policy
The
charter of the Audit Committee requires the pre-approval of all
non-audit services before any such non-audit services are performed
for the Company. The charter of the Audit Committee is posted on
the Company’s website at
www.celcuity.com/home/investors/corporate-governance/. We formed
our Audit Committee in connection with our initial public offering
in 2017.
Vote
Required
Assuming
a quorum is present, the affirmative vote of a majority of the
shares of common stock of Celcuity represented at the Annual
Meeting, either in person or by proxy, and entitled to vote is
required to ratify the appointment of Boulay as our independent
registered public accounting firm.
THE
BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE
FOR RATIFICATION OF THE APPOINTMENT OF OUR
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM.
PROPOSAL
NO. 3
ADVISORY VOTE ON NAMED EXECUTIVE
OFFICER COMPENSATION
The
Dodd-Frank Wall Street Reform and Consumer Protection Act and
Section 14A of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), require companies to provide their stockholders
with the opportunity to vote to approve, on a non-binding, advisory
basis, the compensation of their named executive officers. In
accordance with the preference of our stockholders, as expressed in
a non-binding advisory vote on the frequency of advisory votes on
executive compensation, the Board has determined to hold annual
advisory votes on the compensation of the Named Executive
Officers
We
seek to closely align the interests of our named executive officers
with the interests of our stockholders. We designed our
compensation program to reward our named executive officers for
their individual performance and contributions to our overall
business objectives, and for achieving and surpassing the financial
goals set by our Compensation Committee and our Board.
The
vote on this resolution is not intended to address any specific
element of compensation. Instead, the vote relates to the overall
compensation of our named executive officers, as described in this
Proxy Statement in accordance with the compensation disclosure
rules of the SEC.
Accordingly,
we ask our stockholders to vote on the following resolution at the
Annual Meeting:
“RESOLVED,
that the Company’s stockholders approve, on an advisory basis, the
compensation of the named executive officers, as disclosed in the
Company’s Proxy Statement for the 2023 Annual Meeting of
Stockholders pursuant to the compensation disclosure rules of the
SEC, including the summary compensation table and the other related
tables and disclosure.”
While
the Board and especially the Compensation Committee intend to
carefully consider the results of the voting on this proposal when
making future decisions regarding executive compensation, the vote
is not binding on the Company or the Board and is advisory in
nature. To the extent there is any significant vote against the
compensation of our named executive officers, the Board and the
Compensation Committee will evaluate what actions may be necessary
to address our stockholders’ concerns.
Vote
Required
Assuming
a quorum is present, the affirmative vote of a majority of the
shares of common stock of Celcuity represented at the Annual
Meeting, either in person or by proxy, and entitled to vote is
required to approve the compensation of our named executive
officers. This vote is advisory and is not binding on the Company,
the Board or the Compensation Committee.
THE
BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE
FOR THE APPROVAL OF THE COMPENSATION OF THE NAMED
EXECUTIVE OFFICERS.
PROPOSAL
NO. 4
APPROVAL OF A 1,500,000 SHARE INCREASE TO THE AMENDED AND RESTATED
2017 STOCK
INCENTIVE
PLAN
The
Board has approved, subject to stockholder approval, an amendment
to the Celcuity Inc. Amended and Restated 2017 Stock Incentive
Plan, or the 2017 Plan, to allocate 1,500,000 additional shares for
issuance under the 2017 Plan.
Proposed
Changes
The
only proposed changes to the 2017 Plan are to increase the number
of shares allocated to the 2017 Plan by 1,500,000 shares and to
make a corresponding 1,500,000 share increase to the number of
shares that may be issued under the 2017 Plan pursuant to the
exercise of incentive stock options. No other changes to the 2017
Plan are proposed or recommended.
Description
of the Plan
Purpose.
The purpose of the 2017 Plan is to advance the interests of the
Company and its stockholders by enabling us to attract and retain
persons of skill and ability to perform services for the Company by
providing an incentive to such individuals through equity
participation in the Company and by rewarding such individuals who
contribute to the achievement of our economic objectives. As of
December 31, 2022, 62 individuals were eligible for selection to
receive awards under the Plan.
Shares
Available. We initially reserved 750,000 shares of our common
stock to be issued under our 2017 Plan and reserved an additional
500,000 shares in each of 2021 and 2022 for a total of 1,000,000.
In addition, the number of shares reserved for issuance was
automatically increased by 102,540, 102,998, 149,189, and 216,673
shares on January 1, 2020, 2021, 2022 and 2023, respectively, and
will increase automatically on January 1 of each of 2024 through
2027 by the number of shares equal to 1.0% of the aggregate number
of outstanding shares of our common stock as of the immediately
preceding December 31. However, our Board may reduce the amount of
the increase in any particular year. Any shares of common stock
that are subject to an award that lapses, expires, is forfeited or
for any reason is terminated unexercised or unvested and any shares
of common stock that are subject to an award that is settled or
paid in cash or any form other than shares of common stock will
automatically again become available for issuance under the 2017
Plan. Any shares of common stock that constitute the forfeited
portion of a restricted stock award, however, will not become
available for re-issuance under the 2017 Plan after they have been
so forfeited. Any shares of common stock withheld to satisfy tax
withholding obligations on an award or to pay the exercise price of
a stock option will not become available for re-issuance under the
2017 Plan after they have been withheld for such purposes. As of
March 14, 2023, 94,885 shares had been issued or withheld under the
2017 Plan, 1,886,392 shares were subject to outstanding awards, and
340,123 shares were available for additional grants under the 2017
Plan.
As we
continue to execute on our growth plans, we anticipate further
equity grants to new and existing employees. We expect that our
current reserves under the 2017 Plan, including expected increases
under the annual increase provisions, will not be sufficient to
allow us to meet our growth targets over the next several years.
The proposed 1,500,000 share increase will allow us to meet this
expected need and enable us to better plan for our future growth
and development.
Awards
Available. Our 2017 Plan authorizes the award of stock options,
restricted stock awards, or RSAs, stock appreciation rights, or
SARs, restricted stock units, or RSUs, performance awards and stock
bonuses. No person will be eligible to receive more than 250,000
shares in any calendar year under our 2017 Plan other than a new
employee of ours, who will be eligible to receive no more than
500,000 shares under the 2017 Plan in the calendar year in which
the employee commences employment. After giving effect to the
amendment proposed herein, no more than 3,250,000 shares will be
issued pursuant to the exercise of incentive stock
options.
Our
2017 Plan provides for the grant of awards to our employees,
directors, consultants, independent contractors and advisors,
provided the consultants, independent contractors, directors and
advisors are natural persons that render services not in connection
with the offer and sale of securities in a capital-raising
transaction. The awards granted may vest based on time and/or
achievement of performance conditions.
Stock
options granted under the 2017 Plan may either be granted as
incentive stock options or as non-qualified stock options. Our
Compensation Committee may provide for options to be exercised only
as they vest or to be immediately exercisable with any shares
issued on exercise being subject to our right of repurchase that
lapses as the shares vest. The exercise price of stock options must
be at least equal to the fair market value of our common stock on
the date of grant. The maximum term of options granted under our
2017 Plan is ten years.
An
RSA is a grant by us of shares of our common stock subject to
restrictions. The price (if any) of an RSA will be determined by
the Compensation Committee. Unless otherwise determined by the
Compensation Committee at the time of award, vesting will cease on
the date the participant no longer provides services to us and
unvested shares will be forfeited to or repurchased by
us.
SARs
provide for a payment, or payments, in cash or shares of our common
stock, to the holder based upon the difference between the fair
market value of our common stock on the date of exercise and the
stated exercise price up to a maximum amount of cash or number of
shares.
RSUs
represent the right to receive shares of our common stock at a
specified date in the future, subject to forfeiture of that right
because of termination of employment or failure to achieve certain
performance conditions. If an RSU has not been forfeited, then on
the date specified in the RSU agreement, we will deliver to the
holder of the RSU whole shares of our common stock (which may be
subject to additional restrictions), cash or a combination of our
common stock and cash.
Performance
shares are performance awards that cover a number of shares of our
common stock that may be settled in cash or by issuance of the
underlying shares. These awards are subject to forfeiture prior to
settlement because of termination of employment or failure to
achieve the performance conditions.
Stock
bonuses may be granted as additional compensation for service or
performance and, therefore, will not be issued in exchange for
cash.
Transferability.
Awards granted under our 2017 Plan may not be transferred in any
manner other than by will or by the laws of descent and
distribution or as determined by our Compensation Committee. Unless
otherwise permitted by our Compensation Committee, stock options
may be exercised during the lifetime of the optionee only by the
optionee or the optionee’s guardian or legal representative.
Options granted under our 2017 Plan generally may be exercised for
a period of three months after the termination of the optionee’s
service to us, for a period of 12 months in the case of death or
disability, or such longer period as our Compensation Committee may
provide. Options generally terminate immediately upon termination
of employment for cause.
Certain
Adjustments. In the event there is a specified type of change
in our capital structure without our receipt of consideration, such
as a stock split, appropriate adjustments will be made to the
number of shares reserved under our 2017 Plan, the maximum number
of shares that can be granted in a calendar year and the number of
shares and exercise price, if applicable, of all outstanding awards
under our 2017 Plan.
Change
of Control and Other Corporate Events. Our 2017 Plan provides
that, in the event of specified types of mergers or consolidations,
a sale, lease, or other disposition of all or substantially all of
our assets or other corporate transactions, outstanding awards
under our 2017 Plan may be assumed or replaced by any surviving or
acquiring corporation; the surviving or acquiring corporation may
substitute similar awards for those outstanding under our 2017
Plan; outstanding awards may be settled for the full value of such
outstanding award (whether or not then vested or exercisable) in
cash, cash equivalents, or securities (or a combination thereof) of
the successor entity with payment deferred until the date or dates
the award would have become exercisable or vested; or outstanding
awards may be terminated for no consideration. Our Board or its
Compensation Committee has the discretion to provide that a stock
award under our 2017 Plan will immediately vest as to all or any
portion of the shares subject to the stock award at the time of a
corporate transaction or in the event a participant’s service with
us or a successor entity is terminated actually or constructively
within a designated period following the occurrence of the
transaction. Stock awards held by participants under our 2017 Plan
will not vest automatically on such an accelerated basis unless
specifically provided in the participant’s applicable award
agreement. In the event of a corporate transaction, the vesting of
all awards granted to non-employee directors shall accelerate and
such awards shall become exercisable (as applicable) in full upon
the consummation of the corporate transaction.
Termination;
Amendment. Our 2017 Plan will terminate on September 6, 2027,
unless it is terminated earlier by our board of directors. Our
Board may amend or terminate our 2017 Plan at any time. Our Board
generally may amend our 2017 Plan, without stockholder approval
unless required by applicable law.
Plan
Administration. Our 2017 Plan is administered by our
Compensation Committee or by our Board acting in place of our
Compensation Committee. The Compensation Committee has the
authority to construe and interpret our 2017 Plan, grant awards,
amend or modify any outstanding award (subject to certain
limitations), and make all other determinations necessary or
advisable for the administration of the plan. This authority
includes the ability to modify the number of shares or other terms
and conditions of an award, extend the term of an award, accelerate
the exercisability or vesting or otherwise terminate any
restrictions relating to an award, reduce the exercise price of any
outstanding option, accept the surrender of any outstanding award
or, to the extent not previously exercised or vested, authorize the
grant of new awards in substitution for surrendered
awards.
Tax
Consequences
Options
and SARs. Stock options granted under the 2017 Plan may either
be granted as incentive stock options, which are governed by
Internal Revenue Code Section 422, as amended, or as non-qualified
stock options, which are governed by Internal Revenue Code Section
83, as amended. Generally, no federal income tax is payable by the
participant upon the grant or exercise of an incentive stock option
and no deduction is taken by us. If the participant holds the stock
acquired upon exercise of the option for a certain period, all
appreciation in the value of the shares will be taxed at favorable
capital gains tax rates. If the required holding period is not met,
then any appreciation in the stock up to the date of exercise will
be taxed at ordinary income tax rates. If after exercise, the
participant disposes of the shares within a certain time period, we
will be entitled to deduct the appreciation on the shares at the
time of exercise. Under current tax laws, if a participant
exercises a non-qualified stock option, the participant will be
taxed on the difference between the fair market value of the stock
on the exercise date and the exercise price and we will be entitled
to a corresponding tax deduction. Similar rules apply to
SARs.
RSAs,
RSUs and Performance Shares. RSAs, RSUs and performance shares
under the 2017 Plan generally are not subject to federal income tax
when awarded, unless, solely in the case of RSAs, the participant
properly elects to accelerate the tax recognition. RSAs are
generally subject to ordinary income tax at the time the
restrictions lapse, and performance shares are taxed at the time
the performance targets are met. RSUs are generally subject to
ordinary tax at the time of payment, even if vested earlier. We are
entitled to a corresponding deduction at the time the participant
recognizes taxable income on the RSAs, RSUs or performance
shares.
The
foregoing is only a summary of the effect of U.S. federal income
taxation with respect to the grant and exercise of awards under the
2017 Plan. It does not purport to be complete, and does not discuss
the tax consequences of an individual’s death or the provisions of
the income tax laws of any municipality, state or foreign country
in which any eligible individual may reside.
New
Plan Benefits
The
awards, if any, that will be made to eligible persons under the
Plan are subject to the discretion of the Compensation Committee and,
therefore, we cannot currently determine the benefits or number of
shares subject to awards that may be granted in the future to our
executive officers, employees and directors under the 2017 Plan.
Therefore, a New Plan Benefits Table has not been
provided.
Vote
Required
Assuming
a quorum is present, the affirmative vote of a majority of the
shares of common stock of Celcuity represented at the Annual
Meeting, either in person or by proxy, and entitled to vote is
required to approve the 1,500,000 share increase in the number of
shares authorized under our 2017 Plan. Abstentions will have the
same effect as a vote against this proposal, but broker non-votes
will have no effect on the outcome of this proposal.
THE
BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE
FOR APPROVAL OF THE 1,500,000 SHARE INCREASE IN THE
NUMBER OF SHARES AUTHORIZED UNDER OUR 2017 PLAN.
CORPORATE
GOVERNANCE
Our
Board believes that adherence to good corporate governance
principles is essential to running our business efficiently, to
maintaining our integrity in the marketplace, and to ensuring that
the Company is managed for the long-term benefit of our
stockholders. The Board recognizes that maintaining and ensuring
good corporate governance is a continuous process. Our Board has
adopted the Celcuity Inc. Code of Ethical Business Conduct for
Senior Financial Officers (the “Code of Ethics”) and a charter for
each committee of the Board. The Code of Ethics and the Charters of
the Audit Committee, the Compensation Committee and the Nominating
and Governance Committee, as amended from time to time, are
available on the Company’s website at
www.celcuity.com/home/investors/corporate-governance/ and will be
provided in printed form to any stockholder who requests them from
us. Requests should be directed to Investor Relations, Celcuity
Inc., 16305 36th Avenue North, Suite 100, Minneapolis,
MN 55446.
Board
of Directors
Our
bylaws provide that the size of our Board will be determined from
time to time by resolution of our Board. Under our bylaws, a
director elected for an indefinite term serves until the next
regular meeting of the stockholders and until the director’s
successor is elected, or until the earlier death, resignation or
removal of the director. Our bylaws provide that members of our
Board will be elected by a plurality vote of our
stockholders.
Director
Independence
The
Board has determined that Richard E. Buller, David F. Dalvey, Leo
T. Furcht, Polly A. Murphy, and Richard J. Nigon are independent
directors under the Nasdaq Listing Rules. In evaluating
independence, the Board considered Mr. Nigon’s role as a broker
with Cedar Point Capital, LLC, which served as our placement agent
for certain private placements prior to our initial public offering
and that we have paid Dr. Buller certain consulting fees in
connection with services he has provided to us based on his
expertise in translational medicine. The Board determined that
these relationships will not interfere with the exercise of
independent judgment by these individuals.
Board
Leadership Structure
Our
bylaws provide our Board with flexibility to combine or separate
the positions of Chairman of our Board and Chief Executive Officer
and/or to implement a presiding or lead director in accordance with
its determination that utilizing one or the other structure would
be in the best interests of the Company. Currently, Brian F.
Sullivan, our Chief Executive Officer, is the Chairman of our
Board. Our Board does not currently have a lead independent
director. We believe that this leadership structure is appropriate
at this time because:
|
● |
it
promotes unified leadership and direction for the
Company; |
|
|
|
|
● |
it
allows for a single, clear focus for management to execute the
Company’s strategic initiatives and business plans; |
|
|
|
|
● |
our
Chief Executive Officer is in the best position to chair board
meetings and to ensure that the key business issues and risks
facing the Company are brought to the Board’s attention;
and |
|
|
|
|
● |
we
can more effectively execute our strategy and business plans to
maximize stockholder value if the Chairman of the Board is also a
member of the management team. |
Our
Board will periodically review our leadership structure and may
make such changes in the future as it deems appropriate.
Family
Relationships
Dr.
Laing, our Chief Science Officer and a director, is a
brother-in-law of Mr. Sullivan, the Chairman of our Board and Chief
Executive Officer.
Involvement
in Certain Legal Proceedings
To
the best of our knowledge, none of our directors or executive
officers have, during the past ten years, been involved in any
legal proceedings described in subparagraph (f) of Item 401 of
Regulation S-K.
Risk
Oversight
Our
Board has oversight responsibility for the Company’s risk
management process. The Board administers its oversight function
through its committees, but it retains responsibility for general
oversight of risks. The committee chairs are responsible for
reporting findings regarding material risk exposure to the Board as
quickly as possible. The Board delegates to the Audit Committee
oversight responsibility to review our Code of Ethics, including
whether the Code of Ethics is successful in preventing illegal or
improper conduct, and our management’s risk assessments and
management’s financial risk management policies, including the
policies and guidelines used by management to identify, assess and
manage our exposure to financial risk. Our Compensation Committee
assesses and monitors any major compensation-related risk exposures
and the steps management should take to monitor or mitigate such
exposures.
Code
of Ethics and Certain Restrictions on Stock Transactions
We
have adopted a Code of Ethics applicable to our principal executive
officer and principal financial and accounting officer, in
accordance with Section 406 of the Sarbanes-Oxley Act, the rules of
the SEC promulgated thereunder, and the Nasdaq Listing Rules. If
any changes are made to, or any waivers given from, the Code of
Ethics, these events would be disclosed on our website or in a
Current Report on Form 8-K filed with the SEC within four business
days of such event. The Code of Ethics is posted on our website at
www.celcuity.com/home/investors/corporate-governance/.
Additionally,
under our Insider Trading Policy, executive officers and directors
should not “margin” or pledge Celcuity stock, whether for the
purchase of Celcuity stock or any other securities; and the
Company’s directors and executive officers should not buy or sell
puts or calls with respect to Celcuity securities.
MEETINGS
AND COMMITTEES OF THE BOARD OF DIRECTORS
During
2022, our Board met five times. During 2022, all directors attended
in person or via video conference 100% of the meetings that
occurred during each director’s service on the Board.
The
standing committees of our Board are the Audit Committee, the
Compensation Committee and the Nominating and Corporate Governance
Committee. During 2022, the Audit Committee met five times and the
Compensation Committee met two times and the Nominating and
Corporate Governance Committee met two times. All directors
attended 100% of the meetings of each committee on which they
served.
Executive
Sessions; Attendance at Annual Meeting of Stockholders
The
independent members of the Board periodically meet outside the
presence of management. The Audit Committee has adopted a policy of
meeting in executive session, without management being present, on
a regular basis. During 2022, the members of the Audit Committee
met in executive session once.
The
Board’s policy is that each member of the Board should attend our
annual meetings of stockholders whenever practical and that at
least one member of the Board must attend each annual meeting. All
seven members of the Board then seated attended each of the 2022
annual meeting of stockholders and the special meeting of
stockholders held on September 1, 2022 in person or via video
conference.
Audit
Committee
We
have established an Audit Committee in accordance with Section
3(a)(58)(A) of the Exchange Act. The primary duties and
responsibilities of our Audit Committee are to oversee (1) the
integrity of our accounting and financial reporting processes and
the audits of our financial statements; (2) our systems of internal
controls; (3) our Code of Ethics; and (4) our compliance with legal
and regulatory requirements. In addition, our Audit Committee
appoints and monitors the independence, qualifications and
performance of our independent auditors, provides an avenue of
communication between our independent auditors, management and the
Board, and reviews and approves related party transactions as
required by the Nasdaq Listing Rules.
Mr.
Dalvey, Dr. Furcht, Mr. Nigon and Dr. Murphy are the members of our
Audit Committee. Mr. Dalvey, Dr. Furcht and Mr. Nigon served as
members of the Audit Committee for all of 2022, and Dr. Murphy was
elected to the Audit Committee on November 9, 2022. The members of
the Audit Committee are “independent directors” as that term is
defined in Rules 5605(a)(2) and 5605(c)(2)(A) of the Nasdaq Listing
Rules and Rule 10A-3 of the Exchange Act. The Board has determined
that Mr. Nigon and Mr. Dalvey are each an “audit committee
financial expert” as defined by Item 407(d)(5)(ii) of Regulation
S-K. The Audit Committee operates under a written charter that
satisfies the applicable standards of the SEC and the Nasdaq
Listing Rules.
Compensation
Committee
We
have established a Compensation Committee. Our Compensation
Committee reviews and approves corporate goals and objectives
relevant to compensation of our chief executive officer and other
executive officers, evaluates the performance of these officers in
light of those goals and objectives, and sets the compensation of
these officers based on such evaluations. The Compensation
Committee also reviews and makes recommendations to the Board with
respect to director compensation and the issuance of stock options,
restricted stock and other awards under our equity compensation
plans. The Compensation Committee reviews and prepares the
necessary compensation disclosures required by the SEC.
Additionally, the Compensation Committee reviews and evaluates, on
an annual basis, the Compensation Committee charter and
performance.
Our
Compensation Committee has approved the compensation arrangements
currently in place for our named executive officers. The
Compensation Committee evaluates the performance of our Chairman
and Chief Executive Officer and determines his compensation based
on this evaluation without our Chairman and Chief Executive Officer
present during voting or deliberations on his compensation. With
respect to the other named executive officers, the Compensation
Committee considers the recommendations of our Chairman and Chief
Executive Officer as to performance evaluations and recommended
compensation arrangements.
The
Compensation Committee may approve executive compensation
arrangements or, in its discretion, may recommend such matters to
the full Board for approval. All executive compensation is based on
assessments of executive performance, which are prepared by the
Compensation Committee and submitted to the full Board for review
and discussion. All Compensation Committee recommendations
regarding director compensation are subject to approval by the full
Board. Pursuant to its charter, the Compensation Committee may
delegate any of its responsibilities to a subcommittee comprised of
one or more members of the Compensation Committee.
Dr.
Buller, Mr. Dalvey, Dr. Furcht and Dr. Murphy are the members of
our Compensation Committee. Dr. Buller, Mr. Dalvey and Dr. Furcht
served as members of the Compensation Committee for all of 2022,
and Dr. Murphy was elected to the Compensation Committee on
November 9, 2022. The members of the Compensation Committee are
“independent directors” as that term is defined in Rule 5605(a)(2)
of the Nasdaq Listing Rules and qualify as “non-employee directors”
under Rule 16b-3 of the Exchange Act.
Nominating
and Corporate Governance Committee
We
have established a Nominating and Corporate Governance Committee.
Dr. Buller, Dr. Furcht, and Mr. Nigon are the members of our
Nominating and Corporate Governance Committee. The members of the
Nominating and Corporate Governance Committee are “independent
directors” as that term is defined in Rule 5605(a)(2) of the Nasdaq
Listing Rules. The principal functions of the Nominating and
Corporate Governance Committee are to:
|
● |
develop
and recommend to the Board minimum qualifications for director
nominees; |
|
|
|
|
● |
identify
and evaluate potential candidates for the Board and committee
positions; |
|
|
|
|
● |
recommend
to the Board a slate of nominees for election as directors at our
annual meetings of stockholders; |
|
|
|
|
● |
recommend
to the Board individuals to be appointed to the Board in connection
with vacancies or newly created director positions and the
termination of directors for cause or other appropriate
reasons; |
|
|
|
|
● |
review
the size and composition of the Board and its
committees; |
|
|
|
|
● |
oversee
our corporate governance practices; |
|
|
|
|
● |
evaluate
and make recommendations regarding stockholder proposals submitted
to the Board for inclusion in the company’s proxy statement;
and |
|
|
|
|
● |
develop,
recommend and oversee an annual self-evaluation process for the
Board and its committees. |
QUALIFICATIONS
OF CANDIDATES FOR ELECTION TO THE BOARD
The
Nominating and Corporate Governance Committee identifies and
recommends candidates it believes are qualified to stand for
election as directors of Celcuity or to fill any vacancies on the
Board. In identifying director candidates, the Nominating and
Corporate Governance Committee may retain third party search firms.
The Nominating and Governance Committee will make reasonable
efforts to include at least one qualified woman or minority
candidate in the initial list of director candidates for potential
recommendation to the Board.
In
order to evaluate and identify director candidates, the Nominating
and Corporate Governance Committee considers the suitability of
each director candidate, including the current members of the
Board, in light of the current size, composition and current
perceived needs of the Board. The Nominating and Corporate
Governance Committee seeks highly qualified and experienced
director candidates and considers many factors in evaluating such
candidates, including issues of character, judgment, independence,
background, age, expertise, diversity of experience, length of
service and other commitments. This includes giving due
consideration to contributions to diversity on the Board. In
particular, the Board will consider the manner in which a nominee’s
appointment would impact the overall composition of the Board with
regard to diversity of viewpoint, professional experience,
education, skill, race, ethnicity, gender identity, sexual
orientation, and national origin.
The
Nominating and Corporate Governance Committee does not assign any
particular weight or priority to any of these factors. The
Nominating and Corporate Governance Committee has established the
following minimum requirements for director candidates: being able
to read and understand fundamental financial statements; having at
least 10 years of relevant business experience; having no
identified conflicts of interest as a director of Celcuity; having
not been convicted in a criminal proceeding other than traffic
violations during the ten years before the date of selection; and
being willing to comply with any code of ethics of the Company.
Exceptional candidates who do not meet all of these criteria may
still be considered. The Nominating and Corporate Governance
Committee retains the right to modify these minimum qualifications,
the factors considered in assessing potential candidates, and the
adoption or amendment of any policies related to the recruitment
and nomination of potential candidates, including without
limitation, for compliance with the recently adopted Nasdaq board
diversity rules discussed below.
The
Nominating and Corporate Governance Committee may review director
candidates by reviewing information provided to it, through
discussions with persons familiar with the candidate, or other
actions that the Nominating and Corporate Governance Committee
deems proper. After such review and consideration, the Nominating
and Corporate Governance Committee designates any candidates who
are to be interviewed and by whom they are to be interviewed. After
interviews, the Nominating and Corporate Governance Committee
recommends for Board approval of any new directors to be
nominated.
The
Nominating and Corporate Governance Committee will consider
director candidates recommended by stockholders in the same manner
that it considers all director candidates. Stockholders who wish to
nominate a qualified candidate for the 2024 annual meeting must
submit such nomination in writing to our Corporate Secretary,
Celcuity Inc., 16305 36th Avenue North, Suite 100,
Minneapolis, MN 55446, in accordance with the stockholder proposal
requirements summarized under “Stockholder Proposals”
below.
NASDAQ
BOARD DIVERSITY RULES AND MATRIX
On
August 6, 2021, the SEC approved new board diversity rules for
Nasdaq-listed companies. As of August 8, 2022, we are required to
disclose on an annual basis our directors’ voluntary,
self-identified demographic information using a standardized board
diversity matrix (“Board Diversity Matrix”). To comply with this
requirement, the following Board Diversity Matrix provides the
self-identified demographic information for our directors as of
March 14, 2023 and March 15, 2022. Each of the categories listed in
the table below has the meaning as set forth in Nasdaq Rule
5605(f).
Board Diversity Matrix |
|
|
As of March 14, 2023 |
|
|
As of March 15, 2022 |
|
Total Number
of Directors |
|
|
7 |
|
|
|
|
6 |
|
|
|
|
|
Female |
|
|
|
Male |
|
|
|
Non-Binary |
|
|
|
Female |
|
|
|
Male |
|
|
|
Non-Binary |
|
Part I: Gender Identity |
Directors |
|
|
1 |
|
|
|
6 |
|
|
|
0 |
|
|
|
0 |
|
|
|
6 |
|
|
|
0 |
|
Part II: Demographic Background |
African
American or Black |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Alaskan
Native or Native American |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Asian |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Hispanic or
Latinx |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
Native
Hawaiian or Pacific Islander |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
White |
|
|
1 |
|
|
|
6 |
|
|
|
0 |
|
|
|
0 |
|
|
|
6 |
|
|
|
0 |
|
Two or More
Races or Ethnicities |
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
|
|
0 |
|
LGBTQ+ |
|
|
0 |
|
|
|
|
0 |
|
|
Did Not
Disclose Demographic Background |
|
|
0 |
|
|
|
|
0 |
|
|
In
addition, the new board diversity rules require that, by August 7,
2023, our Board have at least one diverse director that
self-identifies as female, LGBTQ+, and/or an underrepresented
minority, and by August 7, 2026, two diverse directors (including
at least one that self-identifies as female and another who
self-identifies as female, LGBTQ+, and/or an underrepresented
minority). If we do not meet these criteria, we will be required to
disclose the reasons for non-compliance. We intend to meet the
requirements by the specified deadlines, provided that no
assurances can be made that we will be able to attract and retain
one or more directors meeting such requirements. Please note that
the specific requirements and deadlines for the Nasdaq diversity
rules vary depending on whether we continue to qualify as a smaller
reporting company and the specific filing dates of the applicable
proxy statement for our annual meetings, and as such, the preceding
summary of the rules is subject to change from time to
time.
BOARD
OF DIRECTORS VACANCIES
Our
bylaws authorize only our Board to fill vacant directorships,
including newly created seats. In addition, the number of directors
constituting our Board is permitted to be set only by a resolution
adopted by our Board. These provisions prevent a stockholder from
increasing the size of our Board and then gaining control of our
Board by filling the resulting vacancies with its own nominees.
This makes it more difficult to change the composition of our Board
but promotes continuity of management.
STOCKHOLDER
COMMUNICATIONS WITH THE BOARD OF DIRECTORS
Our
stockholders may contact our Board, or any committee of our Board,
by regular mail at Chief Executive Officer, Celcuity Inc., 16305
36th Avenue North, Suite 100, Minneapolis, MN 55446. All
communications will be reviewed by management and, if appropriate
to the duties and responsibilities of the Board, forwarded to the
appropriate director or directors or to the full Board, as
appropriate.
DIRECTOR
COMPENSATION
During
2022, Celcuity’s non-employee directors received compensation in
the form of an equity award with a fair market value of $90,000 as
of May 17, 2022, the date of grant. Each director could elect to
receive the equity award in the form of restricted stock, stock
options or a combination of both. Dr. Buller received the equity
award in the form of restricted stock and a stock option. Dr.
Buller received 3,273 shares of restricted stock, which was
determined by dividing $18,000 by the closing price of a share of
the Company’s common stock on the date of grant. The restricted
stock will vest with respect to 100% of the shares on April 30,
2023. Dr. Buller also received a stock option for the purchase of
19,558 shares, the number of shares that results in the option
having a Black Scholes value of $72,000 as of the date of grant.
Mr. Dalvey, Dr. Furcht and Mr. Nigon received the equity award in
the form of a stock option. Each stock option is for the purchase
of 24,449 shares, the number of shares that results in the option
having a Black Scholes value of $90,000 as of the date of grant.
The stock options have an exercise price of $5.50 per share, which
is equal to the closing price of a share of the Company’s common
stock on the date of grant. The above stock options will vest and
become exercisable with respect to 100% of the shares on April 30,
2023 and will remain exercisable for the remainder of the 10-year
term. Dr. Murphy was elected to the Board on September 12, 2022 and
was awarded 10,000 stock options at an exercise price of $8.31, the
closing price of the Company’s common stock on September 12, 2022.
The options will vest and become exercisable as to 2,500 shares on
each of September 12, 2023, 2024, 2025 and 2026. Dr. Murphy was
also granted 16,300 stock options at an exercise price of $8.31 and
will vest and become exercisable on April 30, 2023. The
Compensation Committee has not yet determined compensation for the
non-employee directors for 2023.
In
addition, non-employee directors are reimbursed for their
out-of-pocket expenses incurred in connection with services as a
director.
Fiscal Year 2022 Director Compensation
The
table below summarizes the compensation paid by the Company to its
non-employee directors for the fiscal year ended December 31, 2022.
Mr. Sullivan and Dr. Laing are not included in this table since
they are each an employee of the Company and receive no
compensation for their services as a director. Each of Mr. Sullivan
and Dr. Laing are included in the Summary Compensation Table under
“Executive Compensation” below.
Name |
|
Stock
Awards
(1)(2)
|
|
|
Option
Awards (1)(3)(4) |
|
|
All Other Compensation |
|
|
Total |
|
Richard E. Buller |
|
$ |
18,000 |
|
|
$ |
79,927 |
|
|
$ |
11,547 |
(5) |
|
$ |
109,474 |
|
David F. Dalvey |
|
$ |
- |
|
|
$ |
120,131 |
|
|
$ |
- |
|
|
$ |
120,131 |
|
Leo T. Furcht |
|
$ |
- |
|
|
$ |
108,815 |
|
|
$ |
- |
|
|
$ |
108,815 |
|
Polly A. Murphy |
|
$ |
- |
|
|
$ |
150,600 |
|
|
$ |
- |
|
|
$ |
150,600 |
|
Richard J. Nigon |
|
$ |
- |
|
|
$ |
124,294 |
|
|
$ |
- |
|
|
$ |
124,294 |
|
|
(1) |
Reflects
the aggregate grant date fair value of equity awards to each
director during 2022, calculated in accordance with FASB ASC Topic
718. Dr. Buller received 3,273 shares of restricted stock and an
option to purchase 19,558 shares of common stock at an exercise
price of $5.50. Dr. Furcht, Mr. Dalvey and Mr. Nigon each received
an option to purchase 24,449 shares of common stock at an exercise
price of $5.50. Dr. Murphy options to purchase 10,000 and 16,300
shares of common stock, respectively at an exercise price of $8.31.
Refer to “Note 12 – Stock-Based Compensation” in the audited
financial statements included in Item 8 of our Annual Report on
Form 10-K for the year ended December 31, 2022 for a discussion of
the assumptions used in calculating the award amount. |
|
(2) |
The
aggregate number of shares of restricted stock held by each of the
directors listed in the table above as of December 31, 2022 was as
follows: Dr. Buller, 9,148 shares of restricted stock; Mr. Dalvey,
9,325 shares of restricted stock. Dr. Furcht, Dr. Murphy or Mr.
Nigon hold no shares of restricted stock. |
|
|
|
|
(3) |
The
aggregate number of stock options held by each of the directors
listed in the table above as of December 31, 2022 was as follows:
Dr. Buller, options to purchase 39,077 shares; Mr. Dalvey, options
to purchase 55,868 shares; Dr. Furcht, options to purchase 61,430
shares; Dr. Murphy, options to purchase 26,300 shares; and Mr.
Nigon, options to purchase 70,831 shares. |
|
|
|
|
(4) |
Effective
May 17, 2022, the Company decreased the exercise price of certain
stock options to $5.50 per share. All other terms of the options
remained the same including, but not limited to, the vesting terms
and expiration dates. The aggregate number of stock options held by
each of the following directors that were repriced was as follows:
Dr. Buller, 6,865 options; Mr. Dalvey, 18,765 options; Dr. Furcht,
10,673 options; and Mr. Nigon, 21,074 options. The amounts shown
under “Option Awards” include the amount by which the fair value of
the modified options exceeded the fair value of the original
options as of the date of such modification, as follows: Dr.
Buller, $7,927; Mr. Dalvey, $30,131; Dr. Furcht, $18,815; and Mr.
Nigon, $34,294. |
|
|
|
|
(5) |
Represents
consulting fees paid in connection with translational medicine
consulting services. |
BENEFICIAL
OWNERSHIP OF COMMON STOCK
The
following table contains information regarding the beneficial
ownership of Celcuity’s common stock as of March 14, 2023 (except
as otherwise indicated) by (i) each person who is known by Celcuity
to beneficially own more than 5% of the outstanding shares of our
common stock; (ii) each director of Celcuity; (iii) each director
nominee; (iv) each named executive officer of Celcuity; and (v) all
executive officers and directors as a group. Unless otherwise
noted, each person or group identified possesses sole voting and
investment power with respect to such shares and the business
address of each person is c/o Celcuity Inc., 16305 36th
Avenue North, Suite 100, Minneapolis, MN 55446.
Name of Beneficial Owner |
|
Amount
and Nature of Beneficial Ownership
(1)(2) |
|
|
Percent
of Class (3) |
|
5%
Stockholders |
|
|
|
|
|
|
|
|
Commodore
Capital Master LP (4) |
|
|
2,259,872 |
|
|
|
9.99 |
% |
Growth
Equity Opportunities 18 VGE, LLC (5) |
|
|
2,268,524 |
|
|
|
9.99 |
% |
RA
Capital Healthcare Fund, L.P. (6) |
|
|
2,251,875 |
|
|
|
9.99 |
% |
Soleus
Private Equity Fund II, L.P. and affiliates
(7) |
|
|
2,288,014 |
|
|
|
9.99 |
% |
Venrock
Healthcare Capital Partners III, L.P. and affiliates
(8) |
|
|
2,173,586 |
|
|
|
9.99 |
% |
Morgan
Stanley (9) |
|
|
1,091,841 |
|
|
|
5.03 |
% |
Officers and Directors |
|
|
|
|
|
|
|
|
Richard E. Buller |
|
|
47,925 |
|
|
|
* |
|
David
F. Dalvey (10) |
|
|
315,193 |
|
|
|
1.45 |
% |
Leo T. Furcht |
|
|
61,680 |
|
|
|
* |
|
Vicky Hahne |
|
|
103,978 |
|
|
|
* |
|
Lance G. Laing |
|
|
1,386,008 |
|
|
|
6.35 |
% |
Polly A. Murphy |
|
|
21,300 |
|
|
|
* |
|
Richard J. Nigon |
|
|
189,731 |
|
|
|
* |
|
Brian F. Sullivan |
|
|
3,539,514 |
|
|
|
15.93 |
% |
All directors and executive
officers as a group (8 individuals) |
|
|
5,665,329 |
|
|
|
24.95 |
% |
*
less than 1%
|
(1) |
The
beneficial ownership reported in the table includes shares of
common stock the beneficial owners have the right to acquire within
60 days of March 14, 2023 upon the exercise of stock options or
warrants, subject to the Beneficial Ownership Limitation described
in note 2 below. |
|
(2) |
With
respect to 5% stockholders other than Morgan Stanley, the
beneficial ownership shown above includes (a) the number of shares
of common stock that may be acquired upon the conversion of shares
of Series A Preferred Stock acquired pursuant to the Securities
Purchase Agreement, dated May 15, 2022 by and among the Company and
the purchasers named therein (the “Securities Purchase Agreement”),
and (b) the number of shares of common stock that may be acquired
upon exercise of warrants issued under the Securities Purchase
Agreement, assuming any such conversions or exercises occur within
60 days of March 14, 2023; provided, however, that the maximum
number of shares of common stock that may be acquired upon such
conversions or exercises is limited such that the beneficial
ownership of such stockholder and its affiliates will not exceed
9.99% (the “Beneficial Ownership Limitation”). |
With
respect to officer and directors, the beneficial ownership shown
above includes the number of shares of common stock the beneficial
owners have the right to acquire within 60 days of March 14, 2023
upon the exercise of stock options or warrants, as follows: Dr.
Buller, 39,077 shares; Mr. Dalvey, 55,868 shares; Dr. Furcht,
61,430 shares; Ms. Hahne, 90,681 shares; Dr. Laing, 136,008 shares;
Dr. Murphy 16,300 shares; Mr. Nigon, 93,699 shares; Mr. Sullivan,
522,871 shares; and all directors and executive officers as a
group, 1,015,934 shares.
|
(3) |
Calculated
based on 21,689,425 issued and outstanding shares of Celcuity
common stock as of March 14, 2023, plus, for each individual, any
securities that such individual has the right to acquire within 60
days of March 14, 2023. |
|
(4) |
In a
Schedule 13G/A filed on February 14, 2023, Commodore Capital Master
LP reported shared voting power and shared dispositive power over
2,257,412 shares of common stock as of December 31, 2022,
consisting of (i) 1,327,952 shares of common stock, (ii) 233,810
shares of common stock issuable upon conversion of the Series A
Preferred Stock, subject to the Beneficial Ownership Limitation
described in Note 2 above, and (iii) 695,650 shares of common stock
issuable upon exercise of warrants, subject to the Beneficial
Ownership Limitation. Based on information known to the Company,
Commodore Capital Master LP beneficially owned 2,259,872 shares as
of as of March 14, 2023, including 931,920 shares that could be
acquired upon the conversion of Series A Preferred Stock or
exercise of warrants, subject to the Beneficial Ownership
Limitation. The reported ownership does not include an additional
1,052,860 shares of common stock issuable to Commodore Capital
Master LP upon conversion of Series A Preferred Stock or exercise
of the warrants without giving effect to the Beneficial Ownership
Limitation. Commodore Capital LP, a Delaware limited partnership
(the “Firm”) is the investment manager to Commodore Capital Master
LP. Michael Kramarz and Robert Egen Atkinson are the managing
partners of the Firm and exercise investment discretion with
respect to the shares reported herein. The address for Commodore
Capital Master LP and the Firm is 444 Madison Avenue, Floor 35, New
York, New York 10022. |
|
(5) |
In a
Schedule 13D/A filed on September 12, 2022, Growth Equity
Opportunities 18 VGE, LLC (“GEO”) reported shared voting power and
shared dispositive power over 1,520,001 shares of common stock, as
of September 1, 2022, consisting of (i) 1,250,001 shares of common
stock and (ii) 270,000 shares of common stock issuable upon the
conversion of the Series A Preferred Stock or exercise of warrants,
subject to the Beneficial Ownership Limitation described in Note 2
above. Based on information known to the Company, GEO beneficially
owned 2,268,524 shares as of as of March 14, 2023, including
1,018,523 shares that could be acquired upon the conversion of
Series A Preferred Stock or exercise of warrants subject to the
Beneficial Ownership Limitation. The reported ownership does not
include an additional 2,601,037 shares of common stock issuable to
GEO upon conversion of Series A Preferred Stock or exercise of the
warrants without giving effect to the Beneficial Ownership
Limitation. NEA 18 Venture Growth Equity, L.P. (“NEA 18 VGE”) is
the sole member of GEO; NEA Partners 18 VGE, L.P. (“NEA Partners 18
VGE”) is the sole general partner of NEA 18 VGE; and NEA 18 VGE GP,
LLC (“NEA 18 VGE LLC” and, together with NEA Partners 18 VGE, the
“Control Entities”) is the sole general partner of NEA Partners 18
VGE. Ali Behbahani (“Behbahani”), Carmen Chang (“Chang”), Anthony
A. Florence, Jr. (“Florence”), Liza Landsman (“Landsman”), Mohamad
H. Makhzoumi (“Makhzoumi”), Edward T. Mathers (“Mathers”), Scott D.
Sandell (“Sandell”), Peter W. Sonsini (“Sonsini”), Paul Walker
(“Walker”) and Rick Yang (“Yang”) (together, the “Managers”) are
the managers of NEA 18 VGE LLC. The address of the principal
business office of GEO, NEA 18 VGE, each Control Entity and Sandell
is New Enterprise Associates, 1954 Greenspring Drive, Suite 600,
Timonium, MD 21093. The address of the principal business office of
Behbahani and Mathers is New Enterprise Associates, 5425 Wisconsin
Avenue, Suite 800, Chevy Chase, MD 20815. The address of the
principal business office of Chang, Makhzoumi, Sonsini, Walker and
Yang is New Enterprise Associates, 2855 Sand Hill Road, Menlo Park,
California 94025. The address of the principal business office of
Florence and Landsman is New Enterprise Associates, 104 5th Avenue,
19th Floor, New York, NY 10001. |
|
(6) |
In a
Schedule 13G/A filed on February 14, 2023, RA Capital Healthcare
Fund, L.P. (the “Fund”) reported shared voting power and shared
dispositive power over 2,249,421 shares of common stock as of
December 31, 2022, consisting of (i) 1,400,001 shares of common
stock and (ii) 849,420 shares of common stock issuable upon the
conversion of Series A Preferred Stock or the exercise of warrants,
subject to the Beneficial Ownership Limitation described in Note 2
above. Based on information known to the Company, the Fund
beneficially owned 2,251,875 shares as of as of March 14, 2023,
including 851,874 shares that could be acquired upon the conversion
of Series A Preferred Stock or exercise of warrants subject to the
Beneficial Ownership Limitation. The reported ownership does not
include an additional 2,252,476 shares of common stock issuable to
the Fund upon conversion of Series A Preferred Stock or exercise of
the warrants without giving effect to the Beneficial Ownership
Limitation. RA Capital Healthcare Fund GP, LLC is the general
partner of the Fund. The Fund has delegated to RA Capital
Management, L.P. the sole power to vote and the sole power to
dispose of all securities held in the Fund’s portfolio, including
the shares reported herein The general partner of RA Capital
Management, L.P. is RA Capital Management GP, LLC, of which Dr.
Peter Kolchinsky and Mr. Rajeev Shah are the controlling persons.
The address of the above referenced entities and persons is 200
Berkeley Street, 18th Floor, Boston, MA
02116. |
|
(7) |
In a
Schedule 13G/A filed on February 14, 2023, Soleus Private Equity
Fund II, L.P. (“Soleus PE”) and Soleus Capital Master Fund, L.P.
(“Master Fund”) reported shared voting power and shared dispositive
voting power over 2,285,554 shares of common stock as of December
31, 2022, consisting of shares of common stock that are either held
by Soleus PE and/or Master Fund, or that may be acquired upon the
conversion of Series A Preferred Stock or the exercise of warrants
that are held by Soleus PE and/or Master Fund, subject to the
Beneficial Ownership Limitation described in Note 2 above. Based on
information known to the Company, Soleus PE and/or Master Fund
beneficially owned 2,288,014 shares as of as of March 14, 2023,
including shares of common stock that are either held by Soleus PE
and/or Master Fund, or that may be acquired upon the conversion of
Series A Preferred Stock or the exercise of warrants that are held
by Soleus PE and/or Master Fund, subject to the Beneficial
Ownership Limitation. The reported ownership does not include an
additional 4,157,005 shares of common stock issuable to Soleus PE
and/or Master Fund upon conversion of Series A Preferred Stock or
exercise of the warrants without giving effect to the Beneficial
Ownership Limitation. Soleus Private Equity GP II, LLC (“Soleus
GP”) is the general partner of Soleus PE, and Soleus PE GP II, LLC
is the sole manager of Soleus GP. Mr. Guy Levy is the sole managing
member of Soleus PE GP II, LLC. Soleus Capital, LLC is the general
partner of Master Fund, and Soleus Capital Group, LLC is the sole
managing member of Soleus Capital, LLC. Mr. Guy Levy is the sole
managing member of Soleus Capital Group, LLC. The address of the
above referenced entities and persons is 104 Field Point Road,
2nd Floor, Greenwich, CT 06830. |
|
(8) |
In a
Schedule 13G/A filed on February 14, 2023, Venrock Healthcare
Capital Partners III, L.P., VHCP Co-Investment Holdings III, LLC,
and Venrock Healthcare Capital Partners EG, L.P. (collectively, the
Venrock Entities) reported shared voting power and shared
dispositive power over 2,171,125 shares of common stock as of
December 31, 2022, consisting of (i) 570,789 shares held by Venrock
Healthcare Capital Partners III, L.P.; (ii) 57,101 shares held by
VHCP Co-Investment Holdings III, LLC; and (iii) 1,543,235 shares
held by Venrock Healthcare Capital Partners EG, L.P. The reported
ownership included 65,739 shares that could be acquired by the
Venrock Entities upon the conversion of Series A Preferred Stock or
the exercise of warrants subject to the Beneficial Ownership
Limitation described in Note 2 above. Based on information known to
the Company, the Venrock Entities beneficially owned 2,173,586
shares as of as of March 14, 2023, including 68,200 shares that
could be acquired upon the conversion of Series A Preferred Stock
or exercise of warrants subject to the Beneficial Ownership
Limitation. The reported ownership does not include an additional
3,913,320 shares of common stock issuable to the Venrock Entities
upon conversion of Series A Preferred Stock or exercise of the
warrants without giving effect to the Beneficial Ownership
Limitation. VHCP Management III, LLC is the general partner of
Venrock Healthcare Capital Partners III, L.P. and the manager of
VHCP Co-Investment Holdings III, LLC. VHCP Management EG, LLC is
the general partner of Venrock Healthcare Capital Partners EG, L.P.
Dr. Bong Koh and Nimish Shah are the voting members of VHCP
Management III, LLC and VHCP Management EG, LLC. The address of the
above referenced entities and persons is 7 Bryant Park, 23rd Floor,
New York, NY 10018. |
|
(9) |
In a
Schedule 13G filed on February 8, 2023, Morgan Stanley reported
shared voting power over 1,023,379 shares of common stock and
shared dispositive power over 1,091,841 shares of common stock as
of December 31, 2022. The address of Morgan Stanley is 1585
Broadway, New York, New York, 10036. |
|
(10) |
Mr.
Dalvey’s beneficial ownership includes 250,000 shares of common
stock owned by Brightstone Venture Capital Fund, LP, of which Mr.
Dalvey is the General Partner. |
EXECUTIVE
OFFICERS
The
following table identifies our current executive officers, the
positions they hold, and their current age. Our executive officers
are appointed by our Board of Directors to hold office until their
successors are elected or their earlier death, resignation or
removal.
Name |
|
Age |
|
|
Positions |
Brian F. Sullivan |
|
|
61 |
|
|
Chairman of the Board and
Chief Executive Officer |
Lance G. Laing |
|
|
61 |
|
|
Chief Science Officer, Vice President,
Secretary and Director |
Vicky Hahne |
|
|
57 |
|
|
Chief Financial Officer |
For
biographical information about Mr. Sullivan and Dr. Laing, please
refer to Proposal 1 entitled “Election of Directors.” Biographical
information about Ms. Hahne is as follows:
Vicky Hahne, Chief Financial Officer
Ms.
Hahne joined as our Chief Financial Officer in July 2017. She has
more than 25 years of financial leadership experience, including
the most recent 15 years in the healthcare industry. Prior to
joining Celcuity, Ms. Hahne served as Controller of Respiratory
Technologies Inc., a medical device manufacturer, from 2015 to
2017. While at Respiratory Technologies, she played a key role in
the due diligence process to sell the company to Koninklijke
Philips. In 2014, she served as Controller for Ability Network
Inc., a healthcare information technology company. From 2007 to
2012, Ms. Hahne served as Controller of SterilMed Inc., a medical
device reprocessing company, where she was significantly involved
in the sale of the company to Johnson & Johnson. Prior to these
roles, Ms. Hahne held several senior financial positions at
SimonDelivers Inc., including Chief Financial Officer. Ms. Hahne
has extensive experience in early stage, high growth companies with
responsibilities including financial controls and stewardship,
financial analysis, mergers and acquisitions, building
infrastructure and systems. She received a B.S. degree in Finance
and Accounting from Northern State University and received her CPA
certificate in 1990.
EXECUTIVE
COMPENSATION
Overview
The
compensation of our executive officers is structured with the goal
of providing a competitive compensation program that will enable us
to attract and retain highly-qualified executives, which is
necessary to achieve our financial and strategic objectives and
create long-term value for our stockholders. Our Chief Executive
Officer, Chief Science Officer, and Chief Financial Officer
(collectively, our “named executive officers”) are currently
compensated with a base salary and performance-based incentive pay.
In addition, we have equity incentive plans and an employee stock
purchase plan, under which we grant and have granted options and
other equity awards to our named executive officers, employees,
directors, consultants and independent contractors. See the
“Employee Benefit Plans” subsection below for additional
information on these plans.
Incentive
Pay
We
provide our named executive officers and other senior managers the
opportunity to earn incentive payments under a performance-based
incentive pay program. Payments under the incentive program are
based in part on achievement of individual goals and upon the
Company’s achievement of milestones that advance our core business
strategies. Individual goals and milestones are approved by our
Compensation Committee. Each participant is granted the opportunity
to earn incentive pay up to a maximum percentage of his or her base
salary. The range of milestone-based incentive pay for each of our
named executive officers is 30 - 80% of base salary. Incentive
payments under the incentive program may be made entirely in the
form of equity awards or partly in cash and partly in the form of
equity awards. Incentive payments ranging from 30 to 80% of base
salary were made under the program for the fiscal year 2022 to Mr.
Sullivan, Dr. Laing, and Ms. Hahne. Mr. Sullivan’s incentive
payment was made entirely in the form of an equity award in
2022.
Employment
Agreements, Severance and Change in Control
Agreements
We
have not entered into employment agreements, severance agreements
or change-of-control agreements with our named executive officers.
Mr. Sullivan, Dr. Laing, and Ms. Hahne have each entered into a
confidentiality, assignment of inventions and non-competition
agreement with us, which provides, among other things, that the
named executive officer will not engage in a competitive business
or solicit our employees or consultants for a period of 24 months
after termination of employment.
Summary
Compensation Table
The
following table summarizes the compensation for fiscal 2022 and
2021 of Celcuity’s named executive officers:
Name and Principal Position |
|
Year |
|
|
Salary
(1) |
|
|
Option
Awards (1)(2)(3) |
|
|
Non-Equity Incentive Plan Compensation |
|
|
Total |
|
Brian F. Sullivan |
|
|
2022 |
|
|
$ |
105,769 |
|
|
$ |
1,145,640 |
|
|
$ |
- |
|
|
$ |
1,251,409 |
|
Chairman and Chief Executive
Officer |
|
|
2021 |
|
|
$ |
259,615 |
|
|
$ |
1,065,670 |
|
|
$ |
- |
|
|
$ |
1,325,285 |
|
Lance G. Laing |
|
|
2022 |
|
|
$ |
325,385 |
|
|
$ |
280,115 |
|
|
$ |
- |
|
|
$ |
605,500 |
|
Chief Science Officer |
|
|
2021 |
|
|
$ |
344,423 |
|
|
$ |
477,888 |
|
|
$ |
103,500 |
|
|
$ |
925,811 |
|
Vicky Hahne |
|
|
2022 |
|
|
$ |
210,000 |
|
|
$ |
159,823 |
|
|
$ |
- |
|
|
$ |
369,823 |
|
Chief Financial Officer |
|
|
2021 |
|
|
$ |
191,923 |
|
|
$ |
306,334 |
|
|
$ |
42,600 |
|
|
$ |
540,857 |
|
|
(1) |
In
May 2022, Mr. Sullivan elected to receive an equity award in lieu
of cash compensation for the 14-month period commencing June 1,
2022, and Dr. Laing and Ms. Hahne each elected to receive an equity
award in lieu of a portion of his or her cash compensation for such
14-month period. |
|
(2) |
Reflects
the aggregate grant date fair value of equity awards to each named
executive officer during 2022 and 2021, calculated in accordance
with FASB ASC Topic 718. Refer to “Note 12 – Stock-Based
Compensation” in the audited financial statements included in Item
8 of our Annual Report on Form 10-K for the year ended December 31,
2022 for a discussion of the assumptions used in calculating the
award amount. |
|
(3) |
Effective
May 17, 2022, the Company decreased the exercise price of certain
stock options to $5.50 per share. All other terms of the options
remained the same including, but not limited to, the vesting terms
and expiration dates. Mr. Sullivan held 166,336 options that were
repriced, which had a weighted average exercise price prior to the
decrease of $19.76 per share. Dr. Laing held 93,534 options that
were repriced, which had a weighted average exercise price prior to
the decrease of $19.43 per share. Ms. Hahne held 30,186 options
that were repriced, which had a weighted average exercise price
prior to the decrease of $20.70 per share. The amounts shown under
“Option Awards” for 2022 include the amount by which the fair value
of the modified options exceeded the fair value of the original
options as of the date of such modification, as follows: Mr.
Sullivan: $237,390; Dr. Laing: $140,564; and Ms. Hahne:
$43,821. |
Outstanding
Equity Awards at Fiscal Year End 2022
The
following table lists the outstanding equity awards held by each of
our named executive officers as of December 31, 2022:
|
|
|
|
OPTION AWARDS |
Name |
|
Grant Date |
|
Number of Securities Underlying Unexercised Options (#)
Exercisable |
|
|
Number of Securities Underlying Unexercised Options (#)
Unexercisable |
|
|
Option Exercise Price ($) |
|
|
Option Expiration Date |
Brian F. Sullivan |
|
5/17/2017 |
|
|
21,500 |
|
|
|
0 |
|
|
$ |
8.40 |
|
|
5/17/2027 |
|
|
9/19/2017 |
|
|
8,220 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
9/19/2027 |
|
|
8/13/2018 |
|
|
3,769 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
8/13/2028 |
|
|
10/17/2018 |
|
|
14,675 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
10/17/2028 |
|
|
8/12/2019 |
|
|
4,985 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
8/12/2029 |
|
|
8/12/2019 |
|
|
41,666 |
|
|
|
8,334 |
(1) |
|
$ |
5.50 |
|
|
8/12/2029 |
|
|
8/12/2020 |
|
|
17,281 |
|
|
|
0 |
|
|
$ |
5.90 |
|
|
8/12/2030 |
|
|
8/12/2020 |
|
|
11,666 |
|
|
|
8,334 |
(2) |
|
$ |
5.90 |
|
|
8/12/2030 |
|
|
12/28/2020 |
|
|
5,540 |
|
|
|
5,541 |
(3) |
|
$ |
5.50 |
|
|
12/28/2030 |
|
|
2/2/2021 |
|
|
5,893 |
|
|
|
6,966 |
(4) |
|
$ |
5.50 |
|
|
2/2/2031 |
|
|
3/18/2021 |
|
|
5,201 |
|
|
|
6,688 |
(5) |
|
$ |
5.50 |
|
|
3/18/2031 |
|
|
4/12/2021 |
|
|
5,628 |
|
|
|
7,881 |
(6) |
|
$ |
5.50 |
|
|
4/12/2031 |
|
|
8/11/2021 |
|
|
17,000 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
8/11/2031 |
|
|
8/11/2021 |
|
|
6,666 |
|
|
|
13,334 |
(7) |
|
$ |
5.50 |
|
|
8/11/2031 |
|
|
10/27/2021 |
|
|
1,915 |
|
|
|
4,654 |
(8) |
|
$ |
5.50 |
|
|
10/27/2031 |
|
|
5/17/2022 |
|
|
125,000 |
|
|
|
125,000 |
(9) |
|
$ |
5.50 |
|
|
5/17/2032 |
Lance G. Laing |
|
5/17/2017 |
|
|
16,125 |
|
|
|
0 |
|
|
$ |
8.40 |
|
|
5/17/2027 |
|
|
9/19/2017 |
|
|
4,110 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
9/19/2027 |
|
|
10/17/2018 |
|
|
1,834 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
10/17/2028 |
|
|
8/12/2019 |
|
|
41,666 |
|
|
|
8,334 |
(10) |
|
$ |
5.50 |
|
|
8/12/2029 |
|
|
8/12/2020 |
|
|
11,666 |
|
|
|
8,334 |
(11) |
|
$ |
5.90 |
|
|
8/12/2030 |
|
|
12/28/2020 |
|
|
1,385 |
|
|
|
1,386 |
(12) |
|
$ |
5.50 |
|
|
12/28/2030 |
|
|
2/2/2021 |
|
|
1,473 |
|
|
|
1,742 |
(13) |
|
$ |
5.50 |
|
|
2/2/2031 |
|
|
3/18/2021 |
|
|
1,300 |
|
|
|
1,673 |
(14) |
|
$ |
5.50 |
|
|
3/18/2031 |
|
|
4/12/2021 |
|
|
2,814 |
|
|
|
3,940 |
(15) |
|
$ |
5.50 |
|
|
4/12/2031 |
|
|
8/11/2021 |
|
|
6,666 |
|
|
|
13,334 |
(16) |
|
$ |
5.50 |
|
|
8/11/2031 |
|
|
10/27/2021 |
|
|
547 |
|
|
|
1,330 |
(17) |
|
$ |
5.50 |
|
|
10/27/2031 |
|
|
5/17/2022 |
|
|
19,205 |
|
|
|
19,207 |
(18) |
|
$ |
5.50 |
|
|
5/17/2032 |
Vicky Hahne |
|
5/17/2017 |
|
|
37,500 |
|
|
|
0 |
|
|
$ |
8.40 |
|
|
5/17/2027 |
|
|
7/5/2018 |
|
|
3,000 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
7/05/2028 |
|
|
10/17/2018 |
|
|
932 |
|
|
|
0 |
|
|
$ |
5.50 |
|
|
10/17/2028 |
|
|
8/12/2019 |
|
|
2,500 |
|
|
|
500 |
(19) |
|
$ |
5.50 |
|
|
8/12/2029 |
|
|
8/12/2020 |
|
|
5,833 |
|
|
|
4,167 |
(20) |
|
$ |
5.90 |
|
|
8/12/2030 |
|
|
12/28/2020 |
|
|
561 |
|
|
|
561 |
(21) |
|
$ |
5.50 |
|
|
12/28/2030 |
|
|
2/2/2021 |
|
|
596 |
|
|
|
705 |
(22) |
|
$ |
5.50 |
|
|
2/2/2031 |
|
|
3/18/2021 |
|
|
526 |
|
|
|
678 |
(23) |
|
$ |
5.50 |
|
|
3/18/2031 |
|
|
4/12/2021 |
|
|
1,585 |
|
|
|
2,221 |
(24) |
|
$ |
5.50 |
|
|
4/12/2031 |
|
|
8/11/2021 |
|
|
5,000 |
|
|
|
10,000 |
(25) |
|
$ |
5.50 |
|
|
8/11/2031 |
|
|
10/27/2021 |
|
|
239 |
|
|
|
582 |
(26) |
|
$ |
5.50 |
|
|
10/27/2031 |
|
|
5/17/2032 |
|
|
15,964 |
|
|
|
15,966 |
(27) |
|
$ |
5.50 |
|
|
5/17/2032 |
|
(1) |
This option vests as to 1,041.67 shares in 8 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2023. |
|
(2) |
This option vests as to 416.67 shares in 20 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2024. |
|
(3) |
This option vests as to 230.85 shares in 24 installments on the
1st of each of month beginning January 1, 2023 and
ending December 1, 2024. |
|
(4) |
This option vests as to 267.90 shares in 26 installments on the
1st of each of month beginning January 1, 2023 and
ending February 1, 2025. |
|
(5) |
This option vests as to 247.69 shares in 27 installments on the
1st of each of month beginning January 1, 2023 and
ending March 1, 2025. |
|
(6) |
This option vests as to 281.44 shares in 28 installments on the
1st of each of month beginning January 1, 2023 and
ending April 1, 2025. |
|
(7) |
This option vests as to 416.67 shares in 32 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2025. |
|
(8) |
This option vests as to 136.85 shares in 34 installments on the
1st of each of month beginning January 1, 2023 and
ending October 1, 2025. |
|
(9) |
This option vests as to 17,857.14 shares in 7 installments on the
1st of each of month beginning January 1, 2023 and
ending July 1, 2023. |
|
(10) |
This option vests as to 1,041.67 shares in 8 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2023. |
|
(11) |
This option vests as to 416.67 shares in 20 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2024. |
|
(12) |
This option vests as to 57.73 shares in 24 installments on the
1st of each of month beginning January 1, 2023 and
ending December 1, 2024. |
|
(13) |
This option vests as to 66.98 shares in 26 installments on the
1st of each of month beginning January 1, 2023 and
ending February 1, 2025. |
|
(14) |
This option vests as to 61.94 shares in 27 installments on the
1st of each of month beginning January 1, 2023 and
ending March 1, 2025. |
|
(15) |
This option vests as to 140.71 shares in 28 installments on the
1st of each of month beginning January 1, 2023 and
ending April 1, 2025. |
|
(16) |
This option vests as to 416.67 shares in 32 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2025. |
|
(17) |
This option vests as to 39.10 shares in 34 installments on the
1st of each of month beginning January 1, 2023 and
ending October 1, 2025. |
|
(18) |
This option vests as to 2,743.71 shares in 7 installments on the
1st of each of month beginning January 1, 2023 and
ending July 1, 2023. |
|
(19) |
This option vests as to 62.50 shares in 8 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2023. |
|
(20) |
This option vests as to 208.33 shares in 20 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2024. |
|
(21) |
This option vests as to 23.38 shares in 24 installments on the
1st of each of month beginning January 1, 2023 and
ending December 1, 2024. |
|
(22) |
This option vests as to 27.10 shares in 26 installments on the
1st of each of month beginning January 1, 2023 and
ending February 1, 2025. |
|
(23) |
This option vests as to 25.08 shares in 27 installments on the
1st of each of month beginning January 1, 2023 and
ending March 1, 2025. |
|
(24) |
This option vests as to 79.29 shares in 28 installments on the
1st of each of month beginning January 1, 2023 and
ending April 1, 2025. |
|
(25) |
This option vests as to 312.50 shares in 32 installments on the
1st of each of month beginning January 1, 2023 and
ending August 1, 2025. |
|
(26) |
This option vests as to 17.10 shares in 34 installments on the
1st of each of month beginning January 1, 2023 and
ending October 1, 2025. |
|
(27) |
This option vests as to 2,280.71 shares in 7 installments on the
1st of each of month beginning January 1, 2023 and
ending July 1, 2023. |
Pay
Versus Performance
We
are providing the following information about the relationship
between executive compensation actually paid to our named executive
officers (NEOs) and certain financial performance measures of the
Company for each of the last two fiscal years, in accordance with
Item 402(v) of Regulation S-K. For purposes of this disclosure,
“compensation actually paid” to our NEOs is determined by making
various adjustments to the total compensation amounts reported in
the Summary Compensation Table. The table below summarizes
compensation amounts reported in our Summary Compensation Table, as
well as the adjusted amounts of “compensation actually paid” for
fiscal 2022 and 2021. For our NEOs other than our principal
executive officer (PEO), compensation is reported as an
average.
The
following table sets forth information concerning the compensation
of our NEOs for fiscal 2022 and 2021, and certain financial
performance measures of the Company for each fiscal
year:
Year
(1) |
|
|
Summary
Compensation Table (SCT)
Total for PEO |
|
|
Compensation
Actually Paid
(CAP) to
PEO (2) |
|
|
Average SCT
Total for
Non-PEO
NEOs |
|
|
Average
CAP to
Non-PEO
NEOs (2) |
|
|
Value
of Initial
Fixed $100
Investment
Based On Total Shareholder Return (TSR)
(3) |
|
|
Net Loss
(thousands) |
|
|
2022 |
|
|
$ |
1,251,409 |
|
|
$ |
2,477,572 |
|
|
$ |
487,661 |
|
|
$ |
644,278 |
|
|
$ |
152.95 |
|
|
$ |
(40,370 |
) |
|
2021 |
|
|
$ |
1,325,285 |
|
|
$ |
1,357,562 |
|
|
$ |
733,334 |
|
|
$ |
757,811 |
|
|
$ |
144.00 |
|
|
$ |
(29,605 |
) |
|
(1) |
During
2022 and 2021, Brian F. Sullivan was our PEO, and Lance G. Laing
and Vicky Hahne were our Non-PEO NEOs. |
|
(2) |
In
order to calculate the “compensation actually paid” (CAP) to our
NEOs, we are required under the SEC rules to subtract from the
total compensation amount in the summary compensation table (SCT)
the grant date fair value of equity awards (reflected in column B
in the table below), and add back the following (reflected in
column C in the table below): (i) the year-end fair value of any
equity awards granted in the applicable year that are outstanding
and unvested as of the end of the year; (ii) the amount of change
as of the end of the applicable year (from the end of the prior
fiscal year) in fair value of any awards granted in prior years
that are outstanding and unvested as of the end of the applicable
year; (iii) for awards that are granted and vest in the same
applicable year, the fair value as of the vesting date; (iv) for
awards granted in prior years that vest in the applicable year, the
amount equal to the change as of the vesting date (from the end of
the prior fiscal year) in fair value; (v) for awards granted in
prior years that are determined to fail to meet the applicable
vesting conditions during the applicable year, a deduction for the
amount equal to the fair value at the end of the prior fiscal year;
and (vi) the dollar value of any dividends or other earnings paid
on stock or option awards in the applicable year prior to the
vesting date that are not otherwise reflected in the fair value of
such award or included in any other component of total compensation
for the applicable year. In addition, if any equity award has been
modified during a fiscal year, the changes in fair value included
pursuant to the adjustments described above must take into account
the excess fair value, if any, of any such modified award over the
fair value of the original award as of the date of such
modification. |
|
|
SCT Total |
|
|
Options
Deducted (a) |
|
|
Options
Added (a)(b) |
|
|
Total CAP |
|
|
|
(A) |
|
|
(B) |
|
|
(C) |
|
|
A – B + C |
|
PEO |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
$ |
1,251,409 |
|
|
$ |
1,145,640 |
|
|
$ |
2,371,803 |
|
|
$ |
2,477,572 |
|
2021 |
|
$ |
1,325,285 |
|
|
$ |
1,065,670 |
|
|
$ |
1,097,947 |
|
|
$ |
1,357,562 |
|
Average for
Non-PEO NEOs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
$ |
487,661 |
|
|
$ |
219,969 |
|
|
$ |
376,586 |
|
|
$ |
644,278 |
|
2021 |
|
$ |
733,334 |
|
|
$ |
392,111 |
|
|
$ |
416,588 |
|
|
$ |
757,811 |
|
|
a. |
The
fair value of stock options reported for CAP purposes in columns
(B) and (C) is estimated using a Black-Scholes option pricing model
in accordance with the SEC rules. This model uses both historical
data and current market data to estimate the fair value of options
and requires several assumptions. |
|
b. |
Effective
May 17, 2022, the Company decreased the exercise price of certain
stock options to $5.50 per share. The PEO held 166,336 options that
were repriced, which had a weighted average exercise price prior to
the decrease of $19.76 per share. The Non-PEO NEOs collectively
held 123,720 options that were repriced, which had a weighted
average exercise price prior to the decrease of $19.74 per share.
All other terms of the options remained the same including, but not
limited to, the vesting terms and expiration dates. The amounts
shown in column (C) for 2022 include the amount by which the fair
value of the modified options exceeded the fair value of the
original options as of the date of such modification, as follows:
PEO: $237,390; Non-PEO NEOs: $92,183. |
|
(3) |
TSR
represents the value, as of the end of each fiscal year, of $100
invested in our common stock at the closing price on December 31,
2020, the last trading day before fiscal 2021. The per-share market
price of our common stock on such date was $9.16, and the per-share
market prices on the last trading days of fiscal 2021 and 2022 were
$13.19 and $14.01, respectively. No dividends or other
distributions have been made with respect to our common
stock. |
CAP
vs. TSR and Net Income. We are a clinical-stage biotechnology
company focused on development of targeted therapies for treatment
of multiple solid tumor indications. We have not generated any
revenue from sales to date, and we continue to incur significant
research and development and other expenses related to our ongoing
operations. We provide our NEOs the opportunity to earn incentive
awards in the form of stock options under a performance-based
incentive pay program, based on achievement of individual goals and
the Company’s achievement of milestones that advance our core
business strategies. The Company believes that the use of equity
awards in our performance-based incentive pay program serves to
align our NEOs’ outstanding and unvested awards with shareholders’
interests in the long term. However, the CAP for our NEOs may not
be correlated with the Company’s TSR or net income (loss) for any
given year, including the years set forth in the table, as our core
business strategies are implemented over a period of years, and the
market price of our common stock is affected by many factors and
may not reflect the achievement of milestones under our
performance-based incentive pay program. In addition, in May 2022
our PEO elected to receive an equity award in lieu of cash
compensation for the 14-month period commencing June 1, 2022, and
each of our Non-PEO NEOs elected to receive an equity award in lieu
of a portion of his or her cash compensation for such 14-month
period. The market price of our common stock increased 155% from
$5.50 at the date of such equity awards to $14.01 at the end of the
2022 fiscal year, resulting in a substantial increase in CAP for
2022. The impact of equity incentive compensation was greater for
the PEO’s CAP calculation because the portion of his compensation
that was delivered in the form of equity incentives was greater
than for the Non-PEO NEOs.
Employee
Benefit Plans
2017
Stock Incentive Plan. Our Amended and Restated 2017 Stock
Incentive Plan (the “2017 Plan”) was approved by our stockholders
at the Company’s annual meeting on May 14, 2020. The Company
initially reserved a total of 750,000 shares for issuance under the
2017 Plan. At the Annual Meeting held on May 12, 2021, the
stockholders approved a one-time, 500,000 share increase to the
number of shares reserved for issuance under the 2017 Plan. At the
Annual Meeting held on May 12, 2022, the stockholders approved a
one-time, 500,000 share increase to the number of shares reserved
for issuance under the 2017 Plan. As of December 31, 2022, options
to purchase 1,789,582 shares were outstanding and 242,435 shares
remain available to issue. The number of shares reserved for
issuance under the 2017 Plan increases automatically on each
January 1 through January 1, 2027 by the number of shares equal to
1.0% of the aggregate number of outstanding shares of the Company’s
common stock as of the immediately preceding December 31. However,
the Board may reduce the amount of the increase in any particular
year, and the Board decided that no increase would occur on January
1, 2019. The Board did allow automatic increases in the number of
shares reserved for issuance by 102,540, 102,998, 149,189, and
216,673 shares on January 1, 2020, 2021, 2022, and 2023
respectively, for a total of 459,108 shares remaining under the
2017 Plan as of January 1, 2023. The maximum permitted term of
options granted under the 2017 Plan is ten years. The 2017 Plan
provides for share options, restricted stock awards, stock
appreciation rights, restricted stock units, performance awards and
stock bonuses.
Our
2017 Plan provides that, in the event of specified types of mergers
or consolidations, a sale, lease, or other disposition of all or
substantially all of our assets or other corporate transactions,
outstanding awards under our 2017 Plan may be assumed or replaced
by any surviving or acquiring corporation; the surviving or
acquiring corporation may substitute similar awards for those
outstanding under our 2017 Plan; outstanding awards may be settled
for the full value of such outstanding award (whether or not then
vested or exercisable) in cash, cash equivalents, or securities (or
a combination thereof) of the successor entity with payment
deferred until the date or dates the award would have become
exercisable or vested; or outstanding awards may be terminated for
no consideration. Our Board or its Compensation Committee has the
discretion to provide that a stock award under our 2017 Plan will
immediately vest as to all or any portion of the shares subject to
the stock award at the time of a corporate transaction or in the
event a participant’s service with us or a successor entity is
terminated actually or constructively within a designated period
following the occurrence of the transaction. Stock awards held by
participants under our 2017 Plan will not vest automatically on
such an accelerated basis unless specifically provided in the
participant’s applicable award agreement. In the event of a
corporate transaction, the vesting of all awards granted to
non-employee directors shall accelerate and such awards shall
become exercisable (as applicable) in full upon the consummation of
the corporate transaction.
2017
Employee Stock Purchase Plan. Our 2017 Employee Stock Purchase
Plan (the “ESPP”) was adopted by our Board on September 6, 2017 and
approved by our stockholders at the Company’s annual meeting on May
10, 2018. The Company initially reserved a total of 100,000 shares
for issuance under the ESPP. As of December 31, 2022, 85,215 shares
had been issued and 192,148 remain available for issuance. The
number of shares reserved for issuance under the ESPP increases
automatically on the first day of each fiscal year by the number of
shares equal to 0.5% of the total outstanding number of shares of
common stock. However, the Board may reduce the amount of the
increase in any particular year, and the Board decided that no
increase would occur on January 1, 2019. The Board did allow an
automatic increase in the number of shares reserved for issuance by
51,270, 51,499, 74,594, and 108,337 shares on January 1, 2020,
2021, 2022 and 2023, respectively, for a total of 300,485 shares
remaining under the ESPP as of January 1, 2023. The ESPP provides
participating employees with an opportunity to purchase shares of
the Company’s common stock at a discount through payroll
deductions. The ESPP is available to all employees unless they are
employed for less than 20 hours per week or own 5% or more of the
total combined voting power or value of the Company’s common stock.
The ESPP is administered using overlapping 24 month offering
periods, referred to as an Offering Period. Each Offering Period
has four six-month purchase periods. A new Offering Period and
purchase period begin every six months on May 1 and November 1 of
each year. Participating employees may purchase common stock, on a
voluntary after tax-basis, at a price equal to 85% of the fair
market value of a share of common stock on either the offering date
or the purchase date, whichever is lower. If the purchase date has
a lower price, the employee will automatically be placed in the
Offering Period beginning immediately after the purchase date. If
the Company is dissolved or liquidated, any purchase period or
Offering Period will terminate immediately prior to the dissolution
or liquidation. If we sell substantially all of our assets to
another company or engage in a merger or consolidation where our
stockholders will own less than 50% of shares of stock in the
resulting company, the ESPP will either be assumed by the successor
entity or a new purchase date will be set before the transaction is
completed, after which the ESPP will terminate.
2012
Equity Incentive Plan. Prior to adopting the 2017 Plan, our
2012 Equity Incentive Plan (the “2012 Plan”) was adopted by the
board of governors and approved by the members of Celcuity LLC on
August 10, 2012 and was subsequently amended on November 12, 2012.
We had originally reserved 625,000 shares for issuance under the
2012 Plan. As of December 31, 2022, options to purchase 187,004 of
these shares were outstanding. We have ceased granting any
additional awards under the 2012 Plan. However, any outstanding
options granted under the 2012 Plan will remain outstanding subject
to the terms of our 2012 Plan and the related option agreements
until such outstanding options are exercised or until they
terminate or expire by their terms. In the event of our merger,
consolidation, sale of substantially all assets, liquidation or
dissolution or other change of control, the 2012 Plan provides that
the Board may accelerate the exercisability of awards, terminate
the 2012 Plan and unexercised awards, continue the 2012 Plan with
respect to outstanding awards, replace or exchange incentive awards
for similar securities of the successor, substitute the awards with
similar awards of the successor or provide for cash payment for
outstanding awards (net of exercise price).
Retirement
Savings Plans. Celcuity maintains an employee benefit plan
qualified under Section 401(k) of the Internal Revenue Code of
1986, as amended. In 2022, the Company matched employee
contributions up to $1,000 per employee per year. Effective January
1, 2023, the Company contribution was changed to match 100% of a
participant’s contributions on the first 2% of eligible
compensation and 50% of the participant’s contributions on the next
4% of eligible compensation.
SECURITIES
AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
The
following table summarizes equity securities authorized for
issuance under our equity compensation plans as of December 31,
2022:
Plan Category |
|
Number of
securities to be
issued upon
exercise of
outstanding
options, warrants
and rights (a) |
|
|
Weighted
average exercise
price of
outstanding
options, warrants
and rights (b) |
|
|
Number
of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected in
column (a)) (c) (1)(2) |
|
Equity compensation plans
approved by stockholders |
|
|
1,976,586 |
|
|
$ |
6.34 |
|
|
|
434,583 |
|
Equity
compensation plans not approved by stockholders |
|
|
- |
|
|
|
- |
|
|
|
- |
|
Total |
|
|
1,976,586 |
|
|
$ |
6.34 |
|
|
|
434,583 |
|
|
(1) |
Includes
242,435 shares of common stock available for issuance under the
2017 Plan and 192,148 shares of common stock available for issuance
under the ESPP as of December 31, 2022. |
|
(2) |
Warrants
to purchase 7,266,102 shares of Company common stock also remain
outstanding. These warrants were not issued as part of an equity
compensation plan and are not reflected in this table. |
DELINQUENT
SECTION 16(a) REPORTS
Section
16(a) of the Exchange Act requires the Company’s officers and
directors, and persons who own more than 10% of a registered class
of the Company’s equity securities, to file reports of ownership on
Form 3 and changes in ownership on Form 4 or Form 5 with the SEC.
Such officers, directors and 10% stockholders are also required by
SEC rules to furnish the Company with copies of all Section 16(a)
forms they file.
Based
solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons, the Company
believes that, during the fiscal year ended December 31, 2022, all
Section 16(a) filing requirements applicable to its officers,
directors and 10% stockholders were timely complied with, except
that one Form 4, reporting an acquisition of shares of stock for
Leo T. Furcht, was filed late.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Except
as described below, since January 1, 2021, there were no related
party transactions arising or existing requiring disclosure under
applicable Nasdaq Listing Rules or SEC rules and
regulations.
Indemnification
Agreements
We
have entered into indemnification agreements with each of our
directors and executive officers. These agreements, among other
things, require us to indemnify our directors and executive
officers for certain expenses, including attorneys’ fees,
judgments, penalties, fines and settlement amounts actually
incurred by these individuals in any action or proceeding arising
out of their service to us or any of our subsidiaries or any other
company or enterprise to which these individuals provide services
at our request. Subject to certain limitations, our indemnification
agreements also require us to advance expenses incurred by our
directors and officers for the defense of any action for which
indemnification is required or permitted.
PIPE
Transaction
On
December 9, 2022, we issued 6,182,574 shares of common stock,
1,120,873 shares of Series A Preferred Stock and warrants
exercisable for 6,956,450 shares of common stock to certain
institutional and other accredited investors in a private placement
pursuant to a securities purchase agreement dated May 15, 2022.
Pursuant to the securities purchase agreement, the closing
(funding) of the private placement occurred following dosage of the
first patient in the Company’s Phase 3 study, VIKTORIA-1. Investors
purchased shares of common stock and Series A Preferred Stock at a
price of $5.75 per share (on an as converted to common stock
basis), with forty percent (40%) warrant coverage (on an as
converted to common stock basis) and customary resale registration
rights. The warrants have an exercise price of $8.05 per share. The
private placement generated gross proceeds of approximately $100
million before deducting placement agent fees and other offering
expenses of $4.3 million. Brian F. Sullivan, the Chairman of the
Board of Directors and our Chief Executive Officer, participated in
the private placement and purchased 260,869 shares of common stock
for an aggregate purchase price of $1,499,996.75 and was issued
warrants to purchase 104,340 shares of common stock, on the same
terms and conditions as the other Investors under the Securities
Purchase Agreement
Policies
and Procedures for Related Party Transactions
We
have a written related person transactions policy that our
executive officers, directors, nominees for election as a director,
beneficial owners of more than 5% of our common stock, and any
members of the immediate family of and any entity affiliated with
any of the foregoing persons, are not permitted to enter into a
material related person transaction with us without the review and
approval of our Audit Committee, or a committee composed solely of
independent directors in the event it is inappropriate for our
Audit Committee to review such transaction due to a conflict of
interest. The policy provides that any request for us to enter into
a transaction with an executive officer, director, nominee for
election as a director, beneficial owner of more than 5% of our
common stock or with any of their immediate family members or
affiliates in which the amount involved exceeds $120,000 will be
presented to our Audit Committee for review, consideration and
approval. In approving or rejecting any such proposal, our Audit
Committee will consider the relevant facts and circumstances
available and deemed relevant to the Audit Committee, including,
but not limited to, whether the transaction is on terms no less
favorable than terms generally available to an unaffiliated third
party under the same or similar circumstances and the extent of the
related person’s interest in the transaction.
AUDIT
COMMITTEE REPORT
Management
is responsible for Celcuity’s financial reporting process,
including the system of internal controls, and for preparing
Celcuity’s financial statements in accordance with accounting
principles generally accepted in the United States of America. Our
independent registered public accounting firm is responsible for
auditing those financial statements and expressing an opinion as to
their conformity with accounting principles generally accepted in
the United States of America. The Audit Committee’s responsibility
is to monitor and review these processes. The members of the Audit
Committee rely, without independent verification, on the
information provided to them and on the representations made by
Celcuity’s management and the independent registered public
accounting firm.
During
2022, the Audit Committee, consisting of Richard J. Nigon
(chairman), David F. Dalvey, and Leo T. Furcht held five meetings.
Polly A. Murphy was appointed to the Audit Committee on November 9,
2022. The meetings were designed to, among other things, facilitate
and encourage communication among the Audit Committee, management
and Celcuity’s independent registered public accounting firm,
Boulay PLLP (“Boulay”). The Audit Committee discussed with Boulay
the overall scope and plans for its 2022 audit. The Audit Committee
met with Boulay, with and without management present, to discuss
the results of its examinations and its evaluations of Celcuity’s
system of internal controls.
During
the meetings held in 2022, the Audit Committee reviewed and
discussed, among other things:
|
● |
Celcuity’s
financial statements, its Quarterly Reports on Form 10-Q, and any
reports received from the independent registered public accounting
firm; |
|
● |
recent
accounting pronouncements and the Company’s significant accounting
policies; |
|
● |
disclosure
controls and procedures and internal controls over financial
reporting; and |
|
● |
engagement
of Celcuity’s independent registered public accounting
firm. |
In
March 2023, the Audit Committee reviewed and discussed the 2022
audited financial statements and notes to the financial statements
proposed for inclusion in the Company’s Annual Report on Form 10-K
for the fiscal year ended December 31, 2022 with management and
Boulay, including a discussion of the application of accounting
principles generally accepted in the United States, the
reasonableness of significant judgments, and the clarity of
disclosures in the financial statements. The Audit Committee also
has discussed with our independent registered public accounting
firm the firm’s independence from management, including whether the
provision of non-audit services is compatible with maintaining the
firm’s independence, and matters required to be discussed by the
applicable requirements of the Public Company Accounting Oversight
Board. The Audit Committee received the written disclosures and the
letter from the independent registered public accounting firm
required by the Public Company Accounting Oversight Board regarding
such firm’s communications with the Audit Committee concerning
independence and has discussed with such firm its
independence.
Based
on this review and prior discussions with management and the
independent registered public accounting firm, the Audit Committee
recommended to the Board that Celcuity’s audited financial
statements be included in its Annual Report on Form 10-K for the
fiscal year ended December 31, 2022 as filed with the
SEC.
Audit
Committee
Richard
J. Nigon (chairman)
David F. Dalvey
Leo T. Furcht
Polly
A. Murphy
STOCKHOLDER
PROPOSALS
Any
stockholder desiring to submit a proposal for action by the
stockholders at our next annual meeting, which will be our 2024
annual meeting, must satisfy the requirements set for in the
advance notice provision under our bylaws. To be timely submitted
for our 2024 annual meeting, any such proposal must be delivered in
writing to our Corporate Secretary at the principal executive
offices of the Company between the close of business on January 12,
2024 and the close of business on February 11, 2024. If the date of
the 2024 annual meeting is advanced more than 30 days prior to or
delayed by more than 60 days after the first anniversary of the
2023 Annual Meeting, notice by the stockholder must be delivered
not earlier than the close of business on the 120th day
prior to the 2024 annual meeting and not later than the close of
business on the later of the 90th day prior to the 2024
annual meeting or, if the first public announcement of the date of
the 2024 annual meeting is less than 100 days prior to the date of
the 2024 annual meeting, the 10th day following the day
on which public announcement of the date of the 2024 annual meeting
is first made.
Notwithstanding
the foregoing, if the number of directors to be elected to our
Board is increased and no public announcement naming all of the
nominees for director or specifying the size of the increased Board
is made by the Company at least 100 days prior to the first
anniversary of the 2023 Annual Meeting, a stockholder’s notice will
be considered timely, but only with respect to nominees for any new
positions created by such increase, if the stockholder delivers
such notice to our Corporate Secretary at the principal executive
offices of the Company not later than the close of business on the
10th day following the day on which a public
announcement naming all of the nominees for director or specifying
the size of the increased Board is first made by the Company.
Notice sent to the Company must comply with the requirements set
forth in the Company’s bylaws. You are advised to review the
Company’s bylaws, and due to the complexity of the respective
rights of the stockholders and the Company in this area, you are
advised to consult with your legal counsel with respect to such
rights.
In
addition to satisfying the foregoing provisions of our bylaws, to
comply with the universal proxy rules under the Exchange Act,
stockholders who intend to solicit proxies in support of director
nominees other than the Company’s nominees must provide notice that
sets forth the information required by Rule 14a-9 under the
Exchange Act no later than March 12, 2024, which is 60 days prior
to the anniversary of the 2023 Annual Meeting.
In
addition, any stockholder proposal intended to be included in the
proxy statement for the 2024 annual meeting must also satisfy Rule
14a-8 of the Exchange Act and be received no later than December 2,
2023. If the date of the 2024 annual meeting is moved by more than
30 days from the first anniversary of the 2023 Annual Meeting, then
notice must be received within a reasonable time before we begin to
print and send proxy materials.
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By Order of the Board of Directors: |
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/s/ Brian F.
Sullivan |
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Chairman of the Board of Directors and Chief
Executive Officer |
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Dated: March 31, 2023 |
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IMPORTANT
NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE
2023
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 11,
2023.
The
Notice, this Proxy Statement, and the Annual Report on Form 10-K
are available at www.proxyvote.com and on the Investor Relations
section of Celcuity’s website at
www.celcuity.com/home/investors/.
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