Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
(State or other jurisdiction of incorporation) |
(I.R.S. Employer Identification No.) | |
(Address of Principal Executive Offices) |
(Zip Code) |
Title of each class |
Trading Symbol |
Name of each exchange on which registered | ||
Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
☒ | Smaller reporting company | |||||
Emerging growth company |
Indication |
Drug |
Status | ||
Fibrosis |
||||
NASH with Advanced Fibrosis: NASH-CX trial andNASH-FX trial |
belapectin | IND submitted January 2013. Results from the Phase 1 clinical trial were reported in 2014, with final results reported in January 2015. The Phase 2 NASH FX trial was designed for patients with advanced fibrosis but not cirrhosis. Its principal purpose was to evaluate various imaging modalities. The NASH FX trial top line data was reported in September 2016 | ||
The Phase 2 NASH CX trial, was designed for patients with well compensated cirrhosis. The NASH CX trial top line data was reported in December 2017 and was published in Gastroenterology | ||||
NASH NAVIGATE | Based on FDA feedback, the NAVIGATE trial is an adaptive Phase 2b/3 trial for the prevention of esophageal varices in NASH patients with compensated cirrhosis. A Phase 2b interim efficacy analysis will be incorporated to confirm previous Phase 2 data, select an optimal dose and reaffirm the risk/benefit of belapectin. The Phase 3 end of study analysis will evaluate the development of esophageal varices as the primary outcome of efficacy and a composite clinical endpoint including progression to varices requiring treatment as a key secondary outcome of efficacy. See www.clinicaltrials.gov NCT04365868. The first patient was randomized in the third quarter of 2020. A hepatic impairment is being conducted in subjects with normal hepatic function and subjects with varying degrees of hepatic impairment (CF: www.clinicaltrials.gov NCT04332432) and began enrolling patients in the second quarter of 2020. | |||
Lung Fibrosis | belapectin | In pre-clinical development | ||
Kidney Fibrosis | belapectin | In pre-clinical development |
Indication |
Drug |
Status | ||
Cardiac and Vascular Fibrosis | belapectin and GM-CT-01 |
In pre-clinical development | ||
Cancer Immunotherapy |
||||
Melanoma, Head, Neck Squamous Cell Carcinoma (HNSCC) |
belapectin | Investigator IND study in process. A Phase 1B study began in Q-1 2016. Early data was reported in February 2017 and additional data were reported in September 2018. The trial is ongoing to expand the dataset of melanoma and HNSCC patients and determine if a Phase 2 trial is warranted. | ||
Psoriasis | ||||
Moderate to Severe Plaque Psoriasis Severe Atopic Dermatitis |
belapectin | IND submitted March 2015. A Phase 2a trial in moderate to severe plaque psoriasis patients began in January 2016. Interim data on the first four patients were positive and were reported in May 2016. Further positive data was reported in September 2016. Investigator initiated IND submitted for treatment of three patients with severe atopic dermatitis, with positive preliminary data presented in February 2017. Further studies are dependent on finding a suitable strategic partner which is unlikely. |
1. | Pre-clinical laboratory tests, animal studies, and formulation studies, |
2. | Submission to the FDA of an IND for human clinical testing, which must become effective before human clinical trials may begin, |
3. | Adequate and well-controlled human clinical trials to establish the safety and efficacy of the drug for each indication, |
4. | Submission to the FDA of a NDA, |
5. | Satisfactory completion of an FDA inspection of the manufacturing facility or facilities, at which the drug is produced to assess compliance with current good manufacturing procedures (“cGMP”) established by the FDA, |
6. | FDA review and approval of the NDA, and |
7. | FDA review and approval of a trademark used in connection with a pharmaceutical. |
Item 1A. Risk |
Factors |
• | successfully complete development activities, including the necessary clinical trials; |
• | complete and submit new drug applications, or NDAs, to the U.S. Food and Drug Administration, or FDA, and obtain regulatory approval for indications for which there is a commercial market; |
• | complete and submit applications to, and obtain regulatory approval from, foreign regulatory authorities; |
• | successfully complete all required regulatory agency inspections; |
• | set a commercially viable price for our products; |
• | obtain commercial quantities of our products at acceptable cost levels; |
• | find suitable distribution partners to help us market, sell and distribute our approved products in other markets; and |
• | obtain coverage and adequate reimbursement from third parties, including government and private payers. |
• | the duration of the clinical trials; |
• | the number of sites included in the trials; |
• | the countries in which the trial is conducted; |
• | the length of time required and ability to enroll eligible patients; |
• | the number of patients that participate in the trials; |
• | the number of doses that patients receive; |
• | the drop-out or discontinuation rates of patients; |
• | per patient trial costs; |
• | third party contractors failing to comply with regulatory requirements or meet their contractual obligations to us in a timely manner; |
• | our drug product candidates having different chemical and pharmacological properties in humans than in lab testing; |
• | the need to suspend or terminate our clinical trials; |
• | insufficient or inadequate supply or quality of drug product candidates or other necessary materials to conduct our trials; |
• | potential additional safety monitoring, or other conditions required by FDA or comparable foreign regulatory authorities regarding the scope or design of our clinical trials, or other studies requested by regulatory agencies; |
• | problems engaging IRBs to oversee trials or in obtaining and maintaining IRB approval of studies; |
• | the duration of patient follow-up; |
• | the efficacy and safety profile of the product candidate; |
• | the costs and timing of obtaining regulatory approvals; and |
• | the costs involved in enforcing or defending patent claims or other intellectual property rights. |
• | we may be forced to suspend marketing of such product; |
• | regulatory authorities may withdraw their approvals of such product; |
• | regulatory authorities may require additional warnings on the label that could diminish the usage or otherwise limit the commercial success of such products; |
• | we may be required to conduct post-market studies; |
• | we could be sued and held liable for harm caused to subjects or patients; and |
• | our reputation may suffer. |
• | others may be able to make compounds that are competitive with our product candidates but are not covered by the claims of our patents; |
• | we might not have been the first to make the inventions covered by our pending patent applications; |
• | we might not have been the first to file patent applications for these inventions; |
• | it is possible that our pending patent applications will not result in issued patents; |
• | we may not develop additional proprietary technologies that are patentable; or |
• | the patents of others may have an adverse effect on our business. |
• | the results of our pre-clinical studies and clinical trials, including interim results, as well as those of our competitors; |
• | regulatory actions with respect to our products or our competitors’ products; |
• | our ability to integrate operations, technology, products and services; |
• | our ability to execute our business plan; |
• | operating results below expectations; |
• | our issuance of additional securities, including debt or equity or a combination thereof, which may be necessary to fund our operating expenses and the cost of our clinical trials; |
• | announcements of technological innovations or new products by us or our competitors; |
• | the success of competitive products; |
• | loss of any strategic relationship; |
• | industry developments, including, without limitation, changes in healthcare policies or practices or third-party reimbursement policies; |
• | regulatory or legal developments in the United States and other countries; |
• | the level of expenses related to any of our product candidates or clinical development programs; |
• | disputes or other developments related to proprietary rights, including patents, litigation matters, and our ability to obtain patent protection for our technologies; |
• | economic and other external factors; |
• | period-to-period |
• | sales of our common stock by us, our insiders or our other stockholders; |
• | whether an active trading market in our common stock develops and is maintained; |
• | engagement and retention of senior management needed for our clinical trials; |
• | novel and unforeseen market forces and trading strategies, such as the massive short squeeze rally caused by retail investors on companies such as Gamestop. |
• | to elect or defeat the election of our directors; |
• | to amend or prevent amendment of our certificate of incorporation or bylaws; |
• | to effect or prevent a merger, sale of assets or other corporate transaction; and |
• | to control the outcome of any other matter submitted to our stockholders for vote. |
• | delays or difficulties in enrolling patients in our clinical trials; |
• | delays or disruptions in non-clinical experiments due to unforeseen circumstances at contract research organizations and vendors along their supply chain; |
• | increased rates of patients withdrawing from our clinical trials following enrollment as a result of contracting COVID-19, being forced to quarantine, or not accepting in office or home health visits; |
• | diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as sites for our NAVIGATE trial and hospital staff supporting the conduct of such trials; |
• | interruption of key clinical trial activities, such as clinical trial site data monitoring, due to limitations on travel imposed or recommended by federal or state governments, employers and others or interruption of clinical trial subject visits and study procedures (particularly any procedures that may be deemed non-essential), which may impact the integrity of subject data and clinical study endpoints; |
• | interruption or delays in the operations of the FDA and comparable foreign regulatory agencies, which may impact review and approval timelines; |
• | interruption of, or delays in receiving, supplies of our product candidates from our contract manufacturing organizations due to staffing shortages, production slowdowns or stoppages and disruptions in delivery systems; and |
• | limitations on employee resources that would otherwise be focused on the conduct of our preclinical studies and clinical trials, including because of sickness of employees or their families, the desire of employees to avoid contact with large groups of people, an increased reliance on working from home or mass transit disruptions. |
Item 1B. |
Unresolved Staff Comments |
Item 2. |
Properties |
Item 3. |
Legal Proceedings |
Item 4. |
Mine Safety Disclosures |
Item 5. |
Market for Registrant ’ s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
Item 6. |
Selected Financial Data |
Item 7. |
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations |
• | our early stage of development, |
• | we have incurred significant operating losses since our inception and cannot assure you that we will generate revenue or profit, |
• | our dependence on additional outside capital, |
• | we may be unable to enter into strategic partnerships for the development, commercialization, manufacturing and distribution of our proposed product candidates, |
• | uncertainties related to any litigation, including shareholder class actions and derivative lawsuits filed, |
• | uncertainties related to our technology and clinical trials, including expected dates of availability of clinical data, |
• | we may be unable to demonstrate the efficacy and safety of our developmental product candidates in human trials, |
• | we may be unable to improve upon, protect and/or enforce our intellectual property, |
• | we are subject to extensive and costly regulation by the U.S. Food and Drug Administration (FDA) and by foreign regulatory authorities, which must approve our product candidates in development and could restrict the sales and marketing and pricing of such products, |
• | competition and stock price volatility in the biotechnology industry, |
• | limited trading volume for our stock, concentration of ownership of our stock, and other risks detailed herein and from time to time in our SEC reports, and |
• | the impact resulting from the outbreak of COVID-19, which has delayed and may continue to delay our clinical trial and development efforts, as well as the impact that COVID-19 has on the volatility of the capital market and our ability to access the capital market. |
Year ended December 31, |
2020 as Compared to 2019 |
|||||||||||||||
2020 |
2019 |
$Change |
% Change |
|||||||||||||
(in thousands, except %) |
||||||||||||||||
Research and development |
$ | 17,976 | $ | 7,467 | $ | 10,509 | 141 | % |
Year Ended December 31, |
||||||||
2020 |
2019 |
|||||||
(in thousands) |
||||||||
Direct external expenses: |
||||||||
Clinical programs |
$ | 14,229 | $ | 4,826 | ||||
Pre-clinical activities |
532 | 394 | ||||||
Other research and development expenses: |
||||||||
Payroll and other including stock-based compensation |
3,215 | 2,247 | ||||||
|
|
|
|
|||||
$17,976 |
$7,467 |
|||||||
|
|
|
|
Year ended December 31, |
2020 as Compared to 2019 |
|||||||||||||||
2020 |
2019 |
$Change |
% Change |
|||||||||||||
(in thousands, except %) |
||||||||||||||||
General and administrative |
$ | 5,468 | $ | 5,971 | $ | (503 | ) | (8 | )% |
Year ended December 31, |
2019 as Compared to 2018 |
|||||||||||||||
2019 |
2018 |
$Change |
% Change |
|||||||||||||
(in thousands, except %) |
||||||||||||||||
Research and development |
$ | 7,467 | $ | 6,471 | $ | 996 | 15 | % |
Year Ended December 31, |
||||||||
2019 |
2018 |
|||||||
(in thousands) |
||||||||
Direct external expenses: |
||||||||
Clinical programs |
$ | 4,826 | $ | 2,296 | ||||
Pre-clinical activities |
394 | 208 | ||||||
Other research and development expenses: |
||||||||
Payroll and other including stock-based compensation |
2,247 | 3,967 | ||||||
|
|
|
|
|||||
$7,467 |
$6,471 |
|||||||
|
|
|
|
Year ended December 31, |
2019 as Compared to 2018 |
|||||||||||||||
2019 |
2018 |
$Change |
% Change |
|||||||||||||
(in thousands, except %) |
||||||||||||||||
General and administrative |
$ | 5,971 | $ | 7,131 | $ | (1,160 | ) | (16 | )% |
Item 7A. |
Quantitative and Qualitative Disclosures About Market Risk |
Item 8. |
Financial Statements and Supplementary Data |
Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
Item 9A. |
Controls and Procedures |
Item 9B. |
Other Information |
Item 10. |
Directors, Executive Officers and Corporate Governance |
Name |
Age |
Director Since |
||||||
Gilbert F. Amelio, Ph.D. (2)(3) |
77 | 2009 | ||||||
James C. Czirr |
67 |
2009 | ||||||
Kary Eldred (1) |
46 | 2018 | ||||||
Kevin D. Freeman (1)(2)(3) |
59 | 2011 | ||||||
Joel Lewis |
51 | 2017 | ||||||
Gilbert S. Omenn, M.D., Ph.D. (2) |
79 | 2014 | ||||||
Marc Rubin, M.D. (3) |
66 | 2011 | ||||||
Elissa J. Schwartz, Ph.D. |
50 | 2020 | ||||||
Harold H. Shlevin, Ph.D. |
71 | 2019 | ||||||
Richard E. Uihlein, Chairman |
75 | 2017 | ||||||
Richard A. Zordani (1) |
48 | 2020 |
(1) | Member of audit committee |
(2) | Member of compensation committee |
(3) | Member of nominating and governance committee |
• | Use of multiple compensation vehicles that provide a balance of long- and short-term incentives with fixed and variable components; and |
• | Equity incentive awards that generally vest over several years, so while the potential compensation payable for equity incentive awards is tied directly to appreciation of our stock price, taking excessive risk for a short term gain is discouraged because it would not maximize the value of equity incentive awards over the long-term. |
Name |
Title | |
Harold H. Shlevin, Ph.D. |
Chief Executive Officer and President, until September 2, 2020 | |
Joel Lewis |
Chief Executive Officer and President, from September 2, 2020 | |
Pol F. Boudes, M.D. |
Chief Medical Officer | |
Jack W. Callicutt |
Chief Financial Officer |
• | provide competitive compensation that will help attract, retain and reward qualified executives; |
• | align executives’ interests with our success by making a portion of the executive’s compensation dependent upon corporate performance; and |
• | align executives’ interests with the interests of stockholders by including long-term equity incentives. |
• | base salary; |
• | performance and retention bonuses; |
• | long-term compensation in the form of equity-based awards. |
Name |
2020 Base Salary |
2019 Base Salary |
||||||
Joel Lewis |
$ | 500,000 | (3) | - | (1) | |||
Pol F. Boudes, M.D.. |
$ | 440,500 | - | (2) | ||||
Jack W. Callicutt |
$ | 302,100 | $ | 285,000 |
(1) | Mr. Lewis became our President and Chief Executive Officer on September 2, 2020. |
(2) | Dr. Boudes became our Chief Medical Officer on March 3, 2020. |
(3) | Pursuant to Mr. Lewis’s Employment Agreement and Deferred Stock Unit Agreement, 20% of Mr. Lewis’ base salary will be paid in cash and 80% will be paid in the form of deferred-stock units in accordance with the terms and subject to the provisions of the DSU Agreement |
Name |
Performance Bonus Amount |
Awarded Amount As % of Base Salary |
||||||
Joel Lewis |
$ | 75,000 | (3) | 45 | % (1) | |||
Pol F. Boudes, M.D. |
$ | 110,000 | 30 | % (2) | ||||
Jack W. Callicutt |
$ | 85,000 | 28 | % | ||||
(1) Mr. Lewis joined the Company on September 2, 2020 and his bonus was prorated for his employment duration in 2020. (2) Dr. Boudes the Company on March 2, 2020 and his bonus was prorated for his employment duration in 2020. (3) Pursuant to Mr. Lewis’s Employment Agreement and Deferred Stock Unit Agreement, 20% of Mr. Lewis’ bonus will be paid in cash and 80% will be paid in the form of deferred-stock units in accordance with the terms and subject to the provisions of the DSU Agreement |
Name |
Retention Bonus Amount |
Awarded Amount As % of Base Salary |
||||||
Harold H. Shlevin, Ph.D. |
$ | 125,000 | 25 | % (1) | ||||
Jack W. Callicutt |
$ | 151,050 | 50 | % |
(1) | Dr. Shlevin retired as our President and Chief Executive Officer effective September 2, 2020 and thus did not receive a retention bonus at December 31, 2020. |
Name |
Grant Date |
Number of Securities Underlying Options |
Exercise Price |
|||||||||
Harold H. Shlevin, Ph.D. |
1/9/2020 | 70,000 | $ | 2.86 | ||||||||
Jack W. Callicutt |
1/9/2020 | 50,000 | $ | 2.86 |
Name and Principal Position |
Year |
Salary ($) |
Bonus ($) |
Option Awards ($) (1) |
All Other Compensation ($) |
Total ($) |
||||||||||||||||
Harold H. Shlevin, Ph.D., |
2020(2) | 375,583 | 335,000 | 154,266 | 54,487 | (4) | 919,336 | |||||||||||||||
Chief Executive Officer & President |
2019 (3) | 500,000 | 465,625 | 268,196 | 72,686 | (5) | 1,306,507 | |||||||||||||||
Joel Lewis, Chief Executive Officer & President |
2020(10) | 164,773 | 75,000 | 486,125 | 27,660 | (11) | 753,558 | |||||||||||||||
Pol F. Boudes, M.D., Chief Medical Officer |
2020(12) | 367,083 | 210,000 | 419,460 | 85,938 | (13) | 1,082,481 | |||||||||||||||
Jack W. Callicutt, |
2020 (6) | 300,675 | 236,050 | 110,190 | 73,457 | (8) | 720,372 | |||||||||||||||
Chief Financial Officer |
2019 (7) | 285,000 | 233,451 | 191,568 | 68,105 | (9) | 778,124 |
(1) | Represents the aggregate grant date fair value of option awards made during 2020 and 2019 computed in accordance with the Stock Compensation Topic of the FASB ASC, as modified of supplemented. Fair value was calculated using the Black-Scholes options pricing model. For a description of the assumptions used to determine these amounts, see Note 7 of the Notes to the Consolidated Financial Statements in our Annual Reports on Form 10-K (or Form 10-K/A, as applicable) for the fiscal years ended December 31, 2020 and 2019. |
(2) | Dr. Shlevin retired from employment as our President and Chief Executive Officer effective September 2, 2020. His salary in 2020 includes the salary earned prior to his retirement. Dr. Shlevin’s bonus amount in 2020 consisted of $125,000 retention bonus in July 2020 and a bonus of $210,000 pursuant to his retirement agreement. |
(3) Dr. | Shlevin’s bonus amount in 2019 consisted of $125,000 retention bonuses paid in July 2019 and January 2020 and $215,625 performance bonus earned in 2019 which was paid in January 2020. |
(4) | Includes $48,635 for health and other insurance and $5,852 for 401(k) plan contributions. |
(5) | Includes $61,486 for health and other insurance and $11,200 for 401(k) plan contributions. |
(6) Mr. | Callicutt’s bonus amount in 2020 consisted of $75,525 retention bonuses paid in July 2020 and January 2021 and $85,000 performance bonus earned in 2020 which was paid in March 2021. |
(7) | Mr. Callicutt’s bonus amount in 2019 consisted of $71,250 retention bonuses paid in July 2019 and January 2020 and $90,951 performance bonus earned in 2019 which was paid in January 2020. |
(8) | Includes $62,057 for health and other insurance and $11,400 for 401(k) plan contributions. |
(9) Includes | $56,905 for health and other insurance and $11,200 for 401(k) plan contributions. |
(10) | Mr. Lewis became our Chief Executive Officer and President effective September 2, 2020, and his performance bonus was prorated for 2021 and paid in March 2021. Pursuant to his employment agreement, 20% his salary and bonus are paid in cash and 80% are in deferred stock units. |
(11) | Includes $25,419 for health and other insurance and $2,341 for 401(k) plan contributions. |
(12) | Dr. Boudes became our Chief Medical Officer effective March 2, 2020. He was paid a $100,000 bonus upon joining the Company. His performance bonus of $110,000 was prorated for 2020 and paid in March 2021. |
(13) | Includes $74,538 for health and other insurance and $11,400 for 401(k) plan contributions. |
Option Awards |
Stock Awards |
|||||||||||||||||||||||||||||
Name |
Number of Securities Underlying Unexercised Options (#) Exercisable |
Number of Securities Underlying Unexercised Options (#) Unexercisable |
Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) |
Option Exercise Price ($) |
Option Expiration Date |
Number of Shares or Units of Stock That Have Not Vested (#) |
Market Value of Shares or Units of Stock That Have Not Vested ($) |
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) |
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) |
|||||||||||||||||||||
Joel Lewis |
54,250 (1) | — | 2.39 | 12/14/2027 | 20,455 | (12) | 45,819 | |||||||||||||||||||||||
35,000 (2) | — | 4.72 | 01/16/2029 | |||||||||||||||||||||||||||
40,000 (3) | — | 2.86 | 01/09/2030 | |||||||||||||||||||||||||||
20,833 (4) | 229,167 (4) | 2.65 | 08/31/2030 | |||||||||||||||||||||||||||
Pol F. Boudes, M.D. |
— (5) | 300,000 (5) | 1.75 | 03/12/2030 | — | — | — | — | ||||||||||||||||||||||
Jack W. Callicutt |
26,000 (6) | — | 13.38 | 01/21/2024 | — | — | — | — | ||||||||||||||||||||||
8,706 (7) | — | 1.37 | 01/20/2026 | |||||||||||||||||||||||||||
90,000 (8) | — | 5.87 | 01/15/2028 | |||||||||||||||||||||||||||
90,000 (9) | — | 4.16 | 05/22/2028 | |||||||||||||||||||||||||||
50,000 (10) | — | 4.72 | 01/16/2029 | |||||||||||||||||||||||||||
25,000 (11) | 25,000 (11) | 2.86 | 01/09/2030 |
(1) | 100% of the options vested in full on December 14, 2018. |
(2) | 100% of the options vested in full on January 16, 2020. |
(3) | 100% of the options vested in full on December 31, 2020. |
(4) | One-twelfth of the total options vest quarterly from August 31, 2020, which was the grant date. |
(5) | 20% of the options vest on each of March 2, 2021, March 2, 2022, and March 2023 and 40% of the options vest on March 2, 2024. |
(6) | 25% of the options vested on January 21, 2014, the grant date with the remainder vested ratably on a monthly basis over a three-year period. |
(7) | 25% of the options vested on January 29, 2015, the grant date with the remainder vested ratably on a monthly basis over a three-year period. |
(8) | 25% of the options vested on January 15, 2018 (grant date), 25% vested on June 30, 2018, and 50% vested on December 31, 2018. |
(9) | 25% of the options vested on June 30, 2018, 25% vested on September 30, 2018, and 50% vested on December 31, 2018. |
(10) | 25% of the options vested on June 30, 2019, 25% vested on December 31, 2019, 25% vested on June 30, 2020, and 25% vested on December 31, 2020. |
(11) | 25% of the options vested on June 30, 2020, 25% vested on December 31, 2020, 25% vest on June 30, 2021, and 25% vest on December 31, 2021. |
(12) | Mr. Lewis’ stock awards in the table are from board compensation taken in restricted stock in lieu of cash compensation prior to becoming president and CEO in September 2020. |
(1) | the acquisition of beneficial ownership of 50% or more of either the value of then outstanding equity securities of the Company or the combined voting power of our securities, except for any acquisition directly from us, any acquisition by us or any person that owns a controlling interest in the Company, or any acquisition by any of our employee benefit plans; |
(2) | during any period of three (3) consecutive years, a majority of the Board is no longer comprised of individuals who, as of the beginning of that period, constituted our Board and individuals whose nomination for election was approved by the Board; |
(3) | a reorganization, merger, statutory share exchange or consolidation or similar transaction, a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or equity of another entity by the Company, in each case unless (i) substantially all of the owners, respectively, of our outstanding shares of common stock or the combined voting power of our securities immediately before the transaction beneficially own more than 50% of, respectively, the common stock and the combined voting power of the securities of the resulting corporation, in substantially the same proportions as their ownership immediately prior to the transaction, (ii) no person owns 50% of, respectively, the common stock and the combined voting power of the securities of the resulting corporation, unless such ownership existed prior to the transaction and (iii) at least a majority of the members of the board of directors of the resulting entity were members of the Board of Directors of the Company at the time of the execution of the initial agreement or of the action of the Board providing for such transaction ; or |
(4) | approval by the stockholders of a complete liquidation or dissolution of the Company. |
Name |
Fees Earned or Paid in Cash ($) |
Restricted Stock Awards ($) (4) |
Option Awards ($) (2) |
Non-Equity Incentive Plan Compensation ($) |
All Other Compensation ($) (3) |
Total ($) |
||||||||||||||||||
Gilbert F. Amelio, Ph.D. |
47,000 | — | 87,997 | — | — | 134,997 | ||||||||||||||||||
James C. Czirr |
38,500 | — | 65,998 | — | — | 104,498 | ||||||||||||||||||
Kevin D. Freeman |
48,500 | — | 98,997 | — | — | 147,497 | ||||||||||||||||||
Kary Eldred |
42,500 | — | 65,998 | — | — | 108,498 | ||||||||||||||||||
Joel Lewis |
— | 58,500 | 87,997 | — | — | 146,497 | ||||||||||||||||||
Gilbert S. Omenn, M.D., Ph.D. |
45,000 | — | 87,997 | — | — | 132,997 | ||||||||||||||||||
Marc Rubin, M.D. |
38,500 | — | 65,998 | — | — | 104,498 | ||||||||||||||||||
Elissa J. Schwartz, Ph.D. (1) |
11,569 | — | — | — | — | 11,569 | ||||||||||||||||||
Harold H. Shlevin, Ph.D. (1) |
11,569 | — | — | — | — | 11,569 | ||||||||||||||||||
Richard Uihlein |
— | 35,000 | 98,997 | — | — | 133,997 | ||||||||||||||||||
Richard A. Zordani (1) |
16,528 | — | — | — | — | 16,528 |
(1) | Dr. Schwartz and Mr. Zordani were appointed to the board effective August 31, 2020. Dr. Shlevin retired as our Chief Executive Officer and president effective September 2, 2020 but retained his position on our board. Dr. Shlevin’s board compensation is for the period after his retirement from employment through the end of the year. |
(2) | Represents the grant date fair value of option awards based upon the Black Scholes valuation model made in 2020. Options were granted on January 9, 2020 and will vested in full on December 31, 2020. For a description of the assumptions used to determine these amounts, see Note 7 to the Notes to the Consolidated Financial Statements herein our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. |
(3) | Excludes travel expense reimbursements. |
(4) | Mr. Lewis and Mr. Uihlein elected to receive restricted stock in lieu of cash retainer for their service. The restricted shares vest in full on January 9, 2021. |
Name |
Number of Shares Subject to Option Awards Held as of December 31, 2020 |
|||
Gilbert F. Amelio, Ph.D. |
75,000 | |||
James C. Czirr |
755,125 | |||
Kary Eldred |
101,875 | |||
Kevin D. Freeman |
179,839 | |||
Joel Lewis (1) |
379,250 | |||
Gilbert S. Omenn, M.D., Ph.D. |
178,750 | |||
Marc Rubin, M.D. |
104,565 | |||
Richard Uihlein |
66,362 | |||
|
|
|||
TOTAL |
1,436,154 | |||
|
|
(1) | Mr. Lewis became our Chief Executive Officer and president effective September 2, 2020 and was granted 250,000 stock options which is included here. |
Item 12. Security |
Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Name and Address (1) |
Shares of Common Stock Beneficially Owned (2) |
Percent of Common Stock (3) |
Shares of Series A Preferred Stock Beneficially Owned |
Percent of Series A Preferred Stock (4) |
||||||||||||
5% Stockholders |
||||||||||||||||
James C. Czirr |
13,610,095 | (5) | 21.4 | % | 100,000 | 7.5 | % | |||||||||
10X Fund, L.P. (8) |
12,068,687 | (6) | 19.2 | % | — | — | ||||||||||
David Smith (9) |
— | — | 175,000 | 13.2 | % | |||||||||||
Early Equities LLC (9) |
— | — | 100,000 | (7) | 7.5 | % | ||||||||||
Richard E. Uihlein (11) |
11,223,949 | (12) | 18.6 | % | — | — | ||||||||||
Directors and Named Executive Officers |
||||||||||||||||
James C. Czirr |
13,610,095 | (5) | 21.4 | % | 100,000 | 7.3 | % | |||||||||
Gilbert F. Amelio, Ph.D. |
139,614 | * | — | — | ||||||||||||
Kevin Freeman |
888,881 | (10) | 1.5 | % | — | — | ||||||||||
Joel Lewis |
361,785 | * | — | — | ||||||||||||
Gilbert S. Omenn, M.D., Ph.D. |
260,990 | * | 50,000 | 3.7 | % | |||||||||||
Marc Rubin, M.D. |
118,146 | * | — | — | ||||||||||||
Richard E. Uihlein |
11,223,949 | (12) | 18.6 | % | — | — | ||||||||||
Richard A. Zordani |
15,353 | * | — | — |
Name and Address (1) |
Shares of Common Stock Beneficially Owned (2) |
Percent of Common Stock (3) |
Shares of Series A Preferred Stock Beneficially Owned |
Percent of Series A Preferred Stock (4) | ||||
Elissa J. Schwartz |
— | — | — | — | ||||
Kary Eldred |
911,575 (13) | 1.6% | — | — | ||||
Harold H. Shlevin, Ph.D. |
366,706 | * | — | — | ||||
Pol F. Boudes |
60,000 | * | — | — | ||||
Jack W. Callicutt |
293,905 | * | — | — | ||||
All executive officers and directors as a group (13 persons) |
28,250,999 (14) | 42.4% | 150,000 | 11.0% |
(1) | Except as otherwise indicated, the address for each named person is c/o Galectin Therapeutics Inc., 4960 Peachtree Industrial Blvd., Suite 240, Norcross, GA 30071. |
(2) | Includes the following number of shares of our common stock issuable upon exercise of outstanding stock options granted to our named executive officers and directors that are exercisable within 60 days after February 28, 2021. |
Directors, Nominees and Named Executive Officers |
Options Exercisable Within 60 Days |
|||
James C. Czirr |
755,125 | |||
Gilbert F. Amelio, Ph.D. |
75,000 | |||
Marc Rubin, M.D. |
104,565 | |||
Gilbert S. Omenn, M.D., Ph.D |
178,750 | |||
Kevin Freeman |
179,839 | |||
Kary Eldred |
101,875 | |||
Joel Lewis. |
170,916 | |||
Richard E. Uihlein. |
66,362 | |||
Harold Shlevin, Ph.D. |
358,000 | |||
Pol F. Boudes, M.D. |
60,000 | |||
Jack Callicutt |
289,706 | |||
|
|
|||
All executive officers and directors as a group |
2,340,138 | |||
|
|
(3) | For each named person and group included in this table, percentage ownership of our common stock is calculated by dividing the number of shares of our common stock beneficially owned by such person or group by the sum of (i) 57,156,030 shares of our common stock outstanding as of February 28, 2021 and (ii) the number of shares of our common stock that such person has the right to acquire within 60 days after February 28, 2021. |
(4) | Based on 1,302,500 shares of Series A preferred stock outstanding as of February 28, 2021. |
(5) | Includes (i) 12,068,687 shares of common stock and stock held by 10X Fund, L.P., as to which Mr. Czirr, in his capacity as a managing member of 10X Capital Management Fund, LLC, a Florida limited liability company and general partner of 10X Fund (referred to herein as 10X Management) has shared voting and investment power, and disclaims beneficial ownership, which shares consist of: 5,732,253 common shares issuable upon exercise of warrants; shares of common stock acquired upon exercise of warrants; and common shares issued as stock dividends paid on the Series B preferred stock which is net of shares sold or distributed to 10X Fund, L.P.; and (ii) 1,541,408 shares of common stock owned directly by Mr. Czirr, consisting of 769,616 shares of common stock owned by Mr. Czirr, 755,125 shares issuable upon the exercise of vested stock options owned by Mr. Czirr, and 16,667 shares of our common stock issuable upon conversion of Series A preferred stock owned by Mr. Czirr. |
(6) | Includes 5,732,253 common shares issuable upon exercise of warrants; shares of common stock acquired upon exercise of warrants; and common shares issued as stock dividends paid on the Series B preferred stock which is net of shares sold or distributed to 10X Fund limited partners, as to which Mr. Czirr, in his capacity as a managing member of 10X Capital Management Fund, LLC, a Florida limited liability company and general partner of 10X Fund, has voting and investment power, and disclaims beneficial ownership, of these securities. |
(7) | Mr. Smith is the manager of Early Equities LLC, a Connecticut limited liability company, and may be deemed to have voting and investment control over, but disclaims beneficial ownership of, the shares of Series A preferred stock. |
(8) | Contact: c/o 10X Capital Management, LLC at Investment Law Group attn: Bob Mottern 545 Dutch Valley Road NE, Suite A, Atlanta, GA 30324. |
(9) | Contact: c/o David Smith 34 Shorehaven Road E., Norwalk, CT 06855. |
(10) | Includes 569,141 shares of the Company’s common stock managed by Cross Consulting and Services, LLC, a Texas limited liability company, d/b/a Freeman Global Investment Counsel. Mr. Freeman, in his capacity as CEO of Freeman Global Investment Counsel, has voting and investment control over, but disclaims beneficial ownership of, these shares. |
(11) | Contact: c/o Uline Corporation, 12575 Uline Drive, Pleasant Prairie, WI 53158 |
(12) | Includes (i) 7,937,869 shares of common stock, (ii) 3,136,384 common shares issuable upon the exercise of common stock purchase warrants, (iii) 66,362 common shares issuable upon the exercise of common stock options, and (iv) 83,334 common shares issuable upon conversion of Series C preferred non-voting stock. |
(13) | Includes 44,915 shares of common stock, 16,869 common stock purchase warrants, and 101,875 common stock options personally owned by Mr. Eldred and 431,527 shares of common stock and 311,964 common stock purchase warrants owned by two private foundations over which Mr. Eldred shares management control, and 4,425 shares of Common Stock held in a trust for a minor child; however, Mr. Eldred disclaims beneficial ownership of the shares and warrants owned by such private foundations and trust. |
(14) | Includes 5,732,253 common shares issuable upon exercise of warrants and common shares acquired upon exercise of warrants or issued as stock dividends on the Series B preferred stock net of shares sold or distributed to 10X Fund limited partners, as to which Mr. Czirr has voting and investment control but are counted one time for purposes of this total. For additional information about the beneficial ownership of our capital stock by Mr. Czirr, see note 5. |
Plan Category |
Number of Securities to be issued upon exercise of outstanding options |
Weighted- average exercise price of outstanding options |
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) |
|||||||||
Equity compensation plans approved by security holders |
3,487,575 | $ | 3.90 | 2,872,307 | ||||||||
Equity compensation plans not approved by security holders (1) |
500,000 | $ | 7.02 | — | ||||||||
|
|
|
|
|
|
|||||||
Total |
3,987,575 | $ | 4.29 | 2,872,307 |
(1) | Represents grants by our Board for stock options granted to employees and consultants that are outside of the stockholder approved compensation plans. The shares underlying these grants are not registered upon exercise and have six month holding restrictions under Rule 144 of the SEC. |
Item 13. |
Certain Relationships, Related Transactions and Director Independence |
Item 14. Principal |
Accountant Fees and Services |
Fiscal Year 2020 |
Fiscal Year 2019 |
|||||||
Audit Fees (1) |
$ | 135,000 | $ | 161,000 | ||||
Audit-Related Fees (2) |
14,323 | 22,000 | ||||||
Tax Fees |
17,000 | 16,400 | ||||||
All Other Fees |
— | — | ||||||
|
|
|
|
|||||
Total Fees |
$ | 166,323 | $ | 199,400 | ||||
|
|
|
|
(1) | Audit Fees. 10-K for fiscal years then ended, and review of financial statements included in our Quarterly Reports on Form 10-Q for each fiscal quarter during the 2020 and 2019 fiscal years. |
(2) | Audit-Related Fees |