DEF 14A
DEF 14Afalse00010989720001098972ecd:PeoMemberagen:FairValueAtFiscalYearEndOfOutstandingAndUnvestedStockOptionAndStockAwardsGrantedInFiscalYearMember2022-01-012022-12-310001098972ecd:PeoMemberagen:FairValueAsOfPriorFiscalYearEndOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsThatFailedToMeetApplicableVestingConditionsDuringFiscalYearMember2021-01-012021-12-310001098972ecd:PeoMemberagen:FairValueAtFiscalYearEndOfOutstandingAndUnvestedStockOptionAndStockAwardsGrantedInFiscalYearMember2020-01-012020-12-310001098972ecd:PeoMemberagen:GrantDateFairValueOfStockOptionAndStockAwardsGrantedInFiscalYearMember2020-01-012020-12-3100010989722022-01-012022-12-310001098972agen:ChangeInFairValueOfOutstandingAndUnvestedStockOptionAndStockGrantAwardsGrantedInPriorFiscalYearsMemberecd:NonPeoNeoMember2022-01-012022-12-310001098972agen:GrantDateFairValueOfStockOptionAndStockAwardsGrantedInFiscalYearMemberecd:NonPeoNeoMember2021-01-012021-12-310001098972ecd:PeoMemberagen:ChangeInFairValueAsOfVestingDateOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsForWhichApplicableVestingConditionsWereSatisfiedDuringFiscalYearMember2022-01-012022-12-310001098972ecd:PeoMemberagen:FairValueAsOfPriorFiscalYearEndOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsThatFailedToMeetApplicableVestingConditionsDuringFiscalYearMember2022-01-012022-12-310001098972ecd:PeoMemberagen:ChangeInFairValueAsOfVestingDateOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsForWhichApplicableVestingConditionsWereSatisfiedDuringFiscalYearMember2021-01-012021-12-310001098972ecd:NonPeoNeoMemberagen:FairValueAsOfPriorFiscalYearEndOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsThatFailedToMeetApplicableVestingConditionsDuringFiscalYearMember2022-01-012022-12-310001098972agen:FairValueAsOfTheVestingDateOfAwardsGrantedAndVestInTheSameYearMemberecd:PeoMember2022-01-012022-12-310001098972agen:ChangeInFairValueOfOutstandingAndUnvestedStockOptionAndStockGrantAwardsGrantedInPriorFiscalYearsMemberecd:PeoMember2022-01-012022-12-310001098972agen:FairValueAsOfTheVestingDateOfAwardsGrantedAndVestInTheSameYearMemberecd:NonPeoNeoMember2020-01-012020-12-310001098972agen:ChangeInFairValueOfOutstandingAndUnvestedStockOptionAndStockGrantAwardsGrantedInPriorFiscalYearsMemberecd:PeoMember2021-01-012021-12-310001098972ecd:PeoMemberagen:FairValueAsOfTheVestingDateOfAwardsGrantedAndVestInTheSameYearMember2021-01-012021-12-310001098972ecd:PeoMemberagen:FairValueAsOfPriorFiscalYearEndOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsThatFailedToMeetApplicableVestingConditionsDuringFiscalYearMember2020-01-012020-12-310001098972ecd:NonPeoNeoMemberagen:FairValueAsOfPriorFiscalYearEndOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsThatFailedToMeetApplicableVestingConditionsDuringFiscalYearMember2021-01-012021-12-3100010989722020-01-012020-12-310001098972agen:FairValueAtFiscalYearEndOfOutstandingAndUnvestedStockOptionAndStockAwardsGrantedInFiscalYearMemberecd:NonPeoNeoMember2020-01-012020-12-310001098972ecd:NonPeoNeoMemberagen:FairValueAsOfPriorFiscalYearEndOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsThatFailedToMeetApplicableVestingConditionsDuringFiscalYearMember2020-01-012020-12-310001098972ecd:PeoMemberagen:GrantDateFairValueOfStockOptionAndStockAwardsGrantedInFiscalYearMember2022-01-012022-12-3100010989722021-01-012021-12-310001098972agen:FairValueAsOfTheVestingDateOfAwardsGrantedAndVestInTheSameYearMemberecd:NonPeoNeoMember2022-01-012022-12-310001098972ecd:PeoMemberagen:ChangeInFairValueAsOfVestingDateOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsForWhichApplicableVestingConditionsWereSatisfiedDuringFiscalYearMember2020-01-012020-12-310001098972agen:ChangeInFairValueOfOutstandingAndUnvestedStockOptionAndStockGrantAwardsGrantedInPriorFiscalYearsMemberecd:PeoMember2020-01-012020-12-310001098972agen:ChangeInFairValueOfOutstandingAndUnvestedStockOptionAndStockGrantAwardsGrantedInPriorFiscalYearsMemberecd:NonPeoNeoMember2021-01-012021-12-310001098972agen:ChangeInFairValueAsOfVestingDateOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsForWhichApplicableVestingConditionsWereSatisfiedDuringFiscalYearMemberecd:NonPeoNeoMember2020-01-012020-12-310001098972agen:ChangeInFairValueOfOutstandingAndUnvestedStockOptionAndStockGrantAwardsGrantedInPriorFiscalYearsMemberecd:NonPeoNeoMember2020-01-012020-12-310001098972agen:FairValueAtFiscalYearEndOfOutstandingAndUnvestedStockOptionAndStockAwardsGrantedInFiscalYearMemberecd:NonPeoNeoMember2021-01-012021-12-310001098972ecd:PeoMemberagen:FairValueAsOfTheVestingDateOfAwardsGrantedAndVestInTheSameYearMember2020-01-012020-12-310001098972agen:GrantDateFairValueOfStockOptionAndStockAwardsGrantedInFiscalYearMemberecd:NonPeoNeoMember2022-01-012022-12-310001098972agen:FairValueAtFiscalYearEndOfOutstandingAndUnvestedStockOptionAndStockAwardsGrantedInFiscalYearMemberecd:NonPeoNeoMember2022-01-012022-12-310001098972ecd:PeoMemberagen:FairValueAtFiscalYearEndOfOutstandingAndUnvestedStockOptionAndStockAwardsGrantedInFiscalYearMember2021-01-012021-12-310001098972agen:ChangeInFairValueAsOfVestingDateOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsForWhichApplicableVestingConditionsWereSatisfiedDuringFiscalYearMemberecd:NonPeoNeoMember2022-01-012022-12-310001098972agen:FairValueAsOfTheVestingDateOfAwardsGrantedAndVestInTheSameYearMemberecd:NonPeoNeoMember2021-01-012021-12-310001098972agen:GrantDateFairValueOfStockOptionAndStockAwardsGrantedInFiscalYearMemberecd:NonPeoNeoMember2020-01-012020-12-310001098972agen:ChangeInFairValueAsOfVestingDateOfStockOptionAndStockAwardsGrantedInPriorFiscalYearsForWhichApplicableVestingConditionsWereSatisfiedDuringFiscalYearMemberecd:NonPeoNeoMember2021-01-012021-12-310001098972ecd:PeoMemberagen:GrantDateFairValueOfStockOptionAndStockAwardsGrantedInFiscalYearMember2021-01-012021-12-31iso4217:USD

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) 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

Definitive Additional Materials

Soliciting Material Pursuant to §240.14a-12

Agenus 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.

Fee paid previously with preliminary materials.

Fee computed on table in exhibit required by item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.


AGENUS INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

 

 

 

Date

Time

Webcast Address

June 12, 2023

10:30 A.M., Eastern Time

Live audio web conference at

www.virtualshareholdermeeting.com/AGEN2023

Proposals

 1.

To elect Garo H. Armen, Susan Hirsch and Ulf Wiinberg as Class II directors, each for a term of three years expiring at the 2026 Annual Meeting of Stockholders.

 2.

To approve an amendment to our 2019 Employee Stock Purchase Plan (as amended) to increase the number of shares of common stock authorized for issuance under such plan from 1,000,000 to 2,000,000.

 3.

To approve, in a non-binding advisory vote, the compensation of the Company's named executive officers.

 4.

To ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2022.

 5.

To recommend, on a non-binding advisory basis, the frequency of future advisory votes on the compensation of the Company's named executive officers.

 

 6.

To consider any other business as may properly come before the 2023

Annual Meeting of Stockholders or any postponement or adjournment of the meeting.

 

 

 

Record Date

You are entitled to vote if you were a stockholder of record on April 17, 2023.

A list of stockholders entitled to vote will be open for examination by any stockholder for any purpose germane to the 2023 Annual Meeting of Stockholders for ten days before the meeting during ordinary business hours at our principal offices at 3 Forbes Road, Lexington, Massachusetts 02421.

It is important that your shares be represented at the 2023 Annual Meeting of Stockholders. Therefore, whether or not you plan to attend the meeting virtually, please complete your proxy and return it to us. If you attend the 2023 Annual Meeting of Stockholders virtually and wish to vote at the meeting, your proxy will not be used. You may also vote your shares over the internet or by telephone. Instructions for internet or telephonic voting are printed on your proxy card.

By order of the Board of Directors,

Garo H. Armen, Chief Executive Officer

April 28, 2023


TABLE OF CONTENTS

Page

GENERAL INFORMATION ABOUT OUR VIRTUAL STOCKHOLDER MEETING

2

VOTING PROCEDURES

3

PROPOSAL 1—ELECTION OF DIRECTORS

8

OUR CORPORATE GOVERNANCE

13

COMPENSATION DISCUSSION AND ANALYSIS

19

COMPENSATION OF NAMED EXECUTIVE OFFICERS

26

DIRECTOR COMPENSATION

35

OWNERSHIP OF OUR COMMON STOCK

41

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

43

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

44

PROPOSAL 2—TO APPROVE AN AMENDMENT TO OUR 2019 EMPLOYEE STOCK PURCHASE PLAN (AS AMENDE D TO INCREASE THE NUMBER OF SHARES OF COMMON STOCK AUTHORIZED FOR ISSUANCE UNDER SUCH PLAN FROM 1,000,000 TO 2,000,000

46

PROPOSAL 3—TO APPROVE, IN A NON-BINDING ADVISORY VOTE, THE COMPENSATION OF THE COMPANY'S NAMED EXECUTIVE OFFICERS FOR 2022

51

PROPOSAL 4—TO RATIFY THE APPOINTMENT OF KPMG LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2023

52

PROPOSAL 5—TO RECOMMEND, ON A NON-BINDING ADVISORY BASIS, THE FREQUENCY OF FUTURE ADVISORY VOTES ON THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS

53

REPORT OF THE AUDIT AND FINANCE COMMITTEE

54

ADDITIONAL INFORMATION

55

APPENDIX A SECOND AMENDMENT TO 2019 EMPLOYEE STOCK PURCHASE PLAN

A-1

 


 

AGENUS INC.

3 Forbes Road

Lexington, Massachusetts 02421

Telephone: (781) 674-4400

PROXY STATEMENT

April 28, 2023

This proxy statement contains information about the 2023 Annual Meeting of Stockholders of Agenus Inc. (the “Annual Meeting”), including any postponements or adjournments of the meeting. The Annual Meeting will be held virtually by live audio web conference at www.virtualshareholdermeeting.com/AGEN2023 on June 12, 2023 at 10:30 A.M., Eastern Time.

In this proxy statement, we refer to Agenus Inc. as “Agenus,” “us,” “we” or the “Company.”

This proxy statement and solicitation is being made on behalf of the Board of Directors of Agenus. In accordance with the “notice and access” rules approved by the Securities and Exchange Commission (“SEC”) and in connection with the solicitation of proxies by our Board of Directors, on or about April 28, 2023 we first sent a Notice of Internet Availability of Proxy Materials and provided access to our proxy materials (consisting of this proxy statement, our Annual Report on Form 10-K for the year ended December 31, 2022 and a form of proxy) over the internet to each stockholder entitled to vote at the Annual Meeting. We intend to mail to requesting stockholders full sets of our proxy materials (consisting of this proxy statement, our Annual Report on Form 10-K for the year ended December 31, 2022 and a form of proxy) on or about April 28, 2023.

Our Annual Report on Form 10-K for the year ended December 31, 2022 is also available on our corporate website at https://investor.agenusbio.com/financial-information/sec-filings and through the SEC’s EDGAR system at http://www.sec.gov. To request a printed copy of our Annual Report on Form 10-K, which we will provide to you without charge, write to Investor Relations, Agenus Inc., 3 Forbes Road, Lexington, Massachusetts 02421. No material on our website is part of this proxy statement.

1


 

GENERAL INFORMATION ABOUT OUR VIRTUAL STOCKHOLDER MEETING

 

 

Why a virtual meeting?

We have designed the virtual format for ease of stockholder access and participation. Stockholders may vote and submit questions online during the meeting by following the instructions below.

Who can attend the 2023 Annual Meeting?

Any Company stockholder as of the close of business on the record date, April 17, 2023, may attend the 2023 Annual Meeting.

How do I attend the 2023 Annual Meeting?

Our Annual Meeting will begin promptly at 10:30 a.m. Eastern Time in a virtual meeting format at www.virtualshareholdermeeting.com/AGEN2023. To participate in the Annual Meeting, you will need the 16-digit control number included in your Notice Regarding the Availability of Proxy Materials, your proxy card or on the instructions that accompanied your proxy materials. We encourage you to access the meeting prior to the start time. Online check-in will start 15 minutes before the meeting, and you should allow ample time for the check-in procedures. If your shares are held in a bank or brokerage account, instructions should also be provided on the voting instruction form provided by your bank or brokerage firm.

If you lose your 16-digit control number, you may join the Annual Meeting as a “Guest,” but you will not be able to vote or ask questions.

What if during the check-in time or during the Annual Meeting I have technical difficulties or trouble accessing the virtual Annual Meeting website?

We will have technicians ready to assist you with any technical difficulties you may have accessing the virtual meeting website. If you encounter any difficulties accessing the virtual meeting website during the check-in or meeting time, please call the technical support number that will be posted on the Annual Meeting log-in page.

2


 

VOTING PROCEDURES

YOUR VOTE IS IMPORTANT. PLEASE TAKE THE TIME TO VOTE. Stockholders have a choice of voting over the internet, by telephone, by mail using a proxy card, or by attending the 2023 Annual Meeting. Please refer to the proxy card or other voting instructions included with these proxy materials for information on the voting methods available to you. If you vote over the internet, by telephone, or virtually at the 2023 Annual Meeting, you do not need to return your proxy card.

 

 

Who can vote?

Each share of our common stock that you owned as of the close of business on April 17, 2023 (the “record date”), entitles you to one vote on each matter to be voted upon at the 2023 Annual Meeting. On the record date, there were 341,662,538 shares of Agenus common stock issued, outstanding, and entitled to vote.

Why did I receive a one-page notice in the mail regarding the internet availability of proxy materials instead of a full set of printed proxy materials?

Pursuant to the “notice and access” rules adopted by the SEC, we provide stockholders access to our proxy materials over the internet. Accordingly, we sent a Notice of Internet Availability of Proxy Materials (“Notice”) to all of our stockholders as of the record date. The Notice includes instructions on how to access our proxy materials over the internet and how to request a printed copy of these materials. In addition, by following the instructions in the Notice, stockholders may request to receive proxy materials in printed form by mail or electronically by e-mail on an ongoing basis.

Choosing to receive your future proxy materials by e-mail will save us the cost of printing and mailing documents to you and will reduce the impact of our annual meetings of stockholders on the environment. If you choose to receive future proxy materials by e-mail, you will receive an e-mail next year with instructions containing a link to those materials and a link to the proxy voting site. Your election to receive proxy materials by e-mail will remain in effect until you revoke the election and request a full set of printed proxy materials.

What is the difference between holding shares directly in my name and holding shares in “street name”?

If your shares are registered directly in your name with our transfer agent, American Stock Transfer & Trust Company, LLC, you are considered the “stockholder of record.” The Notice was sent directly to you by our tabulator, Broadridge Financial Solutions, Inc. (“Broadridge”), on behalf of Agenus.

If your shares are held for you in an account by a broker, bank, or other nominee, you are considered the beneficial owner of shares held in “street name.”

How do I vote?

If your shares are registered directly in your name, you may vote:

Over the internet. Go to the website of our tabulator, Broadridge, at http://www.proxyvote.com and follow the instructions. Your shares will be voted according to your instructions. If you do not specify how you want to vote your shares, your internet vote will not be completed and you will receive an error message. If you hold your shares directly and wish to vote over the internet, your vote must be received by 11:59 P.M. Eastern Time on June 11, 2023. If your shares are held in a Company stock plan and you wish to vote over the internet, your vote must be received by 11:59 P.M. Eastern Time on June 7, 2023.

By telephone. Dial 1-800-690-6903 using any touch-tone telephone and follow the instructions. Your shares will be voted according to your instructions. If you hold your shares directly and wish to vote over the telephone, your vote must be received by 11:59 P.M. Eastern Time on June 11, 2023. If your shares are held in a Company stock plan and you wish to vote over the telephone, your vote must be received by 11:59 P.M. Eastern Time on June 7, 2023.

 

By mail. Complete and sign the enclosed proxy card and mail it in the enclosed postage prepaid envelope to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. The proxy card delivered by mail must be received on or prior to June 11, 2023. Your shares will be voted according to your instructions. If you do not specify how you want your shares voted, they will be voted as recommended by our Board of Directors.

3


 

 

At the 2023 Annual Meeting. You may vote your shares at www.virtualshareholdermeeting.com/AGEN2023 during the 2023 Annual Meeting. You will need the 16-digit control number that is on either the notice or the proxy card when voting. Additional instructions regarding voting will be provided on the 2023 Annual Meeting website.

If your shares are registered in “street name,” you have the right to direct your broker, bank, or nominee how to vote your shares by using the voting instruction card included in the mailing, or by following their instructions for voting over the internet or by telephone.

How can I change my vote?

If your shares are registered directly in your name, you may revoke your proxy and change your vote at any time before the 2023 Annual Meeting. To do this, you must do one of the following:

Vote over the internet as instructed above. Only your latest internet vote is counted.
Vote by telephone as instructed above. Only your latest telephonic vote is counted.
Sign a new proxy card and submit it as instructed above.
Attend the 2023 Annual Meeting virtually and vote at the meeting. Attending the meeting will not revoke your proxy unless you specifically request it. Please refer to the instructions on page 2 for information on how to attend our 2023 Annual Meeting. You may vote during the meeting by following the instructions available on the meeting website.

If your shares are held in “street name,” you may submit new voting instructions by contacting your broker, bank, or nominee. You may also vote at the 2023 Annual Meeting if you deliver a valid and completed proxy card as described in the answer to the “How do I vote?” question above.

Will my shares be voted if I do not return my proxy?

If your shares are registered directly in your name, your shares will not be voted if you do not vote over the internet, vote by telephone, return your proxy, or vote through the web portal at the 2023 Annual Meeting.

If your shares are held in “street name,” your broker, bank, or nominee, under certain circumstances, may vote your shares for you if you do not return your proxy. A broker, bank, or nominee has authority to vote customers’ unvoted shares on some routine matters. If you do not give a proxy to your broker, bank,

4


 

or nominee to vote your shares, it may either vote your shares on routine matters, or leave your shares unvoted. Proposal 4 (to ratify the appointment of KPMG LLP as our independent registered public accounting firm) is the only proposal that is considered a routine matter for this purpose. Your broker, bank, or nominee cannot vote your shares with respect to non-routine matters unless they receive your voting instructions. We encourage you to provide voting instructions to your broker, bank, or nominee by giving them your proxy. This ensures your shares will be voted at the 2023 Annual Meeting according to your instructions. You should receive directions from your broker, bank, or nominee about how to submit your proxy to them at the time you receive this proxy statement.

What does it mean if I receive more than one proxy card?

It means that you have more than one account, which may be at the transfer agent or brokers. Please vote over the internet or by telephone, or complete and return all proxies for each account to ensure that all of your shares are voted.

How many shares must be present to hold the 2023 Annual Meeting?

A majority of our outstanding shares of common stock as of the record date must be present at the 2023 Annual Meeting to hold the meeting and conduct business. This is called a quorum. Shares are counted as present at the meeting if the shares are voted in person or by proxy at the meeting. Shares that are present that vote to abstain or do not vote on one or more of the matters to be voted upon are counted as present for establishing a quorum.

If a quorum is not present, the 2023 Annual Meeting will be adjourned until we obtain a quorum.

What vote is required to approve each matter and how are votes counted?

Proposal 1—To elect three Class II directors, each for a term of three years expiring at the 2026 Annual Meeting of Stockholders.

The nominees for director receiving the highest number of votes FOR election will be elected as a director. This is called a plurality. You may vote FOR the nominees or WITHHOLD your vote from one or more of the nominees. If your shares are held by your broker, bank, or nominee in “street name” and if you do not vote your shares or instruct your broker, bank, or nominee how to vote with respect to this item, your unvoted shares will be counted as “broker non-votes” (when a broker does not have authority to vote on the proposal in question). “Broker non-votes” are not counted for purposes of electing directors. Votes that are withheld will not be included in the vote tally for the election of directors and will have no effect on the results of the vote.

Proposal 2—To approve an amendment to our 2019 Employee Stock Purchase Plan (as amended) to increase the number of shares of common stock authorized for issuance under such plan from 1,000,000 to 2,000,000.

To approve Proposal 2, a majority of the votes cast by stockholders present in person or represented by proxy at the 2023 Annual Meeting and voting on the matter must vote FOR Proposal 2. If your shares are held by your broker, bank, or nominee in “street name” and if you do not vote your shares or instruct your broker, bank, or nominee how to vote with respect to this item, your unvoted shares will be counted as “broker non-votes.” Abstentions and “broker non-votes” will not be counted as votes cast or shares voting on Proposal 2 and will have no effect on the vote.

Proposal 3—To approve, in a non-binding advisory vote, the compensation of the Company's named executive officers.

To approve Proposal 3, a majority of the votes cast by stockholders present in person or represented by proxy at the 2023 Annual Meeting and voting on the matter must vote FOR Proposal 3. Abstentions and “broker non-votes” will not be counted as votes cast or shares voting on Proposal 3 and will have no effect on the vote..

5


 

 

Proposal 4—To ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023.

To approve Proposal 4, a majority of the votes cast by stockholders present in person or represented by proxy at the 2023 Annual Meeting and voting on the matter must vote FOR Proposal 4. If your shares are held by your broker, bank, or nominee in “street name,” and you do not vote your shares, your broker, bank, or nominee has authority to vote your unvoted shares on Proposal 4. If the broker, bank, or nominee does not vote your unvoted shares, there will be no effect on the vote because these “broker non-votes” are not considered to be voting on the matter. Abstentions will not be counted as votes cast or shares voting on Proposal 4 and will have no effect on the vote.

 

Proposal 5—To recommend, on a non-binding advisory basis, the frequency of future advisory votes on the compensation of the Company's named executive officers.

For Proposal 5, the option of one year, two years, or three years that receives the highest number of votes cast by stockholders present in person or represented by proxy at the 2023 Annual Meeting will be considered by the Board of Directors when determining the frequency of future advisory votes on executive compensation. Abstentions and “broker non-votes” will not be counted as votes cast or shares voting on Proposal 5 and will have no effect on the vote.

 

How does the Board of Directors recommend that I vote?

Our Board of Directors recommends that you vote:

FOR Proposal 1—To elect the nominated Class II directors, each for a term of three years expiring at the 2026 Annual Meeting of Stockholders.
FOR Proposal 2—To approve an amendment to our 2019 Employee Stock Purchase Plan (as amended) to increase the number of shares of common stock authorized for issuance under such plan from 1,000,000 to 2,000,000.
FOR Proposal 3—To approve, in a non-binding advisory vote, the compensation of the Company's named executive officers.
FOR Proposal 4—To ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023.
Proposal 5—To recommend future advisory votes on the compensation of the Company's named executive officers once every three years.

Are there other matters to be voted on at the 2023 Annual Meeting?

We do not know of any other matters that may come before the 2023 Annual Meeting. If any other matters are properly presented to the meeting, the persons named in the accompanying proxy card should vote, or otherwise act, in accordance with their judgment.

6


 

Where do I find the voting results of the 2023 Annual Meeting?

We will report the voting results in a Current Report on Form 8-K to be filed with the SEC within four business days after the end of the 2023 Annual Meeting.

Who bears the costs of soliciting these proxies?

We will bear the costs of soliciting proxies. In addition to the mailing of these proxy materials, our directors, officers, and employees may solicit proxies by telephone, e-mail, and in person, without additional compensation. We have retained Alliance Advisors, LLC at an estimated cost of $12,000 plus reimbursement of expenses to assist in our solicitation of proxies. Upon request, we will also reimburse brokerage houses and other custodians, nominees, and fiduciaries for their reasonable out-of-pocket expenses for distributing proxy materials to stockholders.

How can I receive future proxy statements and annual reports over the internet instead of receiving printed copies in the mail?

This proxy statement and our Annual Report on Form 10-K for the year ended December 31, 2022 are available on our website at https://investor.agenusbio.com/financial-information/sec-filings. Most stockholders can elect to view future proxy statements and annual reports over the internet instead of receiving printed copies in the mail.

If your shares are registered directly in your name, you can choose this option when you vote over the internet and save us the cost of producing and mailing these documents. You can also choose to view future proxy statements and annual reports over the internet. Your election to receive proxy materials by e-mail will remain in effect until you revoke the election and request a full set of printed proxy materials. If you choose to receive future proxy materials by e-mail, you will receive an e-mail next year with instructions containing a link to those materials and a link to the proxy voting site.

If your shares are held in “street name,” you should check the information provided by your broker, bank, or other nominee for instructions on how to elect to view future proxy statements and annual reports over the internet. No material on our website is part of this proxy statement.

7


 

PROPOSAL 1—ELECTION OF DIRECTORS

The Board of Directors has nominated the individuals listed below for election as Class II directors. Each nominee currently serves as a Class II director.

Our Board of Directors (the “Board”) is divided into three classes. One class is elected each year and members of each class hold office for three-year terms. The Board currently consists of six members. Two members are Class I directors, with terms expiring at the 2025 Annual Meeting of Stockholders. Three members are Class II directors, with terms expiring at the 2023 Annual Meeting. One member is a Class III director, with a term expiring at the 2024 Annual Meeting of Stockholders. The Board has nominated Garo H. Armen, Susan Hirsch and Ulf Wiinberg, each of whom is a current Class II director, for re-election to a term expiring at the 2026 Annual Meeting of Stockholders.

For more information on nomination of directors, see “Corporate Governance and Nominating Committee” below in the section entitled “Our Corporate Governance—Committees of the Board.”

Your vote is requested in favor of Garo H. Armen, Susan Hirsch and Ulf Wiinberg, the nominees listed below, as Class II directors. The nominees have indicated their willingness to serve, if elected, but if they should be unable or unwilling to serve, proxies may be voted for substitute nominees designated by the Board.

There are no family relationships between or among any of our executive officers, directors, or nominee for director.

Below are the names and certain information about each member of the Board, including the nominees for election as Class II directors:

NOMINEES FOR CLASS II DIRECTORS—TERMS TO EXPIRE IN 2023

Garo H. Armen, Ph.D.

Age: 70

Founder and Chairman and Chief Executive Officer of Agenus Inc.

Director since 1999

(a) Executive Committee

Dr. Armen is Chairman and Chief Executive Officer of Agenus Inc., which he co-founded in 1994. Dr. Armen brings to our Board a deep historical and practical knowledge of the business of the Company and its technologies, as well as years of expertise in the financial and biopharmaceutical arenas. From mid-2002 through 2004, he was Chairman of the Board of Directors for the biopharmaceutical company Elan Corporation, plc which he helped restructure. Dr. Armen currently serves as non-executive Chairman of the Board of Directors of Protagenic Therapeutics, Inc., a publicly held biotechnology company and as the Chairman of the Board of MiNK Therapeutics, Inc., an affiliate of Agenus.

Dr. Armen is also the founder and Chairman of the Children of Armenia Fund, a philanthropic organization established in 2000 that is dedicated to the positive development of the children and youth of rural Armenia. He holds a Ph.D. degree in physical organic chemistry from the City University of New York.

 

 

Susan Hirsch

Age: 70

Director since 2020

(a) Audit and Finance Committee

Ms. Hirsch has over 40 years of experience in investment management and finance. Until February 2021, she was a Managing Director and Portfolio Manager at Nuveen, a TIAA company, where she was responsible for managing over $20 billion in assets including the TIAA-CREF Large-Cap Growth Fund with $6.6 billion in assets. Prior to joining Nuveen in 2005, she served as Executive Vice President and Portfolio Manager for the Mid-Cap Growth and Technology Sector portfolios as Jennison Associates. Ms. Hirsch’s previous experience also includes investment management positions at Lehman Brothers Global Asset Management and Delphi Asset Management as a Senior Portfolio Manager for the Selected Growth Stock Portfolio. She began her career as an analyst at Smith Barney and Lehman Brothers where the success of her quantitative model led to her subsequent recognition as a top ranked Institutional analyst for small cap growth stocks in 1991, 1992 and 1993. Ms. Hirsch holds a BS in Accounting from Brooklyn College. Ms. Hirsch qualifies as an audit committee financial expert and brings extensive investment and financial experience to our Board.

 

 

Ulf Wiinberg

Age: 64

Director since 2016

Mr. Wiinberg has almost 20 years of senior leadership experience, most recently serving as Chief Executive Officer of X+Vax Technology A.S., a biotech company committed to developing vaccines against pathogens acquired by mucosal infection such as herpes. Mr. Wiinberg previously served as Chief Executive Officer of H. Lundbeck A/S (“Lundbeck”) from June 2008 to December 2014. Lundbeck is a global pharmaceutical company developing and

8


 

(a) Audit and Finance Committee (Chair)

(b) Corporate Governance and Nominating Committee

marketing treatments for psychiatric and neurological disorders. He previously served on the boards of several health care industry associations and held multiple executive roles at Wyeth, one of the world’s largest research- driven pharmaceutical companies that was acquired by Pfizer in 2009. He served as President of Wyeth Europe, Africa and Middle East; President of Consumer Healthcare; Managing Director of Wyeth UK, and in various commercial positions. Mr. Wiinberg currently serves on the boards of UCB SA, a global biopharmaceutical company based in Belgium, Hansa Medical AB (Chairman), a Swedish biopharmaceutical company, Alfa Laval AB, a Swedish industrial company, and MiNK Therapeutics, Inc., an affiliate of Agenus. Mr. Wiinberg qualifies as an audit committee financial expert and brings to our Board years of experience in the biotechnology, pharmaceutical and healthcare industries internationally as well as extensive financial and corporate governance experience.

 

 

9


 

CLASS III DIRECTORS – TERMS TO EXPIRE IN 2024

 

Allison M. Jeynes-Ellis, MD, FFPM (UK)

Age: 57

Chief Executive Officer of

Avillion LLP

Director since 2018

(a) Compensation Committee

Dr. Jeynes-Ellis is a trained clinician with more than 25 years of senior leadership experience in the pharmaceutical industry. Dr. Jeynes-Ellis has been the Chief Executive Officer of Avillion LLP (“Avillion”), a London-based drug development company since 2014. Prior to her current position as CEO, Dr. Jeynes-Ellis served as Avillion’s Chief Medical Officer from December 2012 to January 2014. Before her tenure at Avillion, Dr. Jeynes-Ellis worked in senior roles at Wyeth, Bristol-Myers Squibb, and Novartis. Her previous affiliations also include Cambridge Antibody Technology and Genentech, government bodies and medical charities. She has managed teams focusing on global clinical development projects that have led to drug approvals in Europe and the United States, across a range of therapeutic areas. Dr. Jeynes-Ellis became the Chair of the Board of OxSonics Therapeutics (“OxSonics”) in April 2021. OxSonics is a biotechnology company developing ultrasound-based drug delivery systems for the treatment of cancer. Dr. Jeynes-Ellis also sits on the Board of Directors of Anaveon and is a Senior Advisor to Blackstone Life Sciences and a Special Advisor to Abingworth. Dr. Jeynes-Ellis bring to our Board substantial experience as a life science executive and medical expertise.

 

 

10


 

CLASS I DIRECTORS—TERMS TO EXPIRE IN 2025

Brian Corvese

Age: 65

President and Founder of

Vencor Capital

Director since 2007

(a) Compensation Committee

(b) Corporate Governance and Nominating Committee

(c) Executive Committee (Chair)

Since 1999, Mr. Corvese has been the President and Founder of Vencor Capital (“Vencor”), a private equity firm with telecommunications and technology investments in the Middle East and Mediterranean regions. Prior to working at Vencor, Mr. Corvese worked on investments in the U.S. and global equity markets as a Managing Director and partner at Soros Fund Management, the largest hedge fund in the world at the time. From 1988 to 1996, Mr. Corvese was a partner at Chancellor Capital Management (“Chancellor”), a $25 billion money management firm. While at Chancellor, Mr. Corvese was a Portfolio Manager with responsibility for investments made in basic industries, restructurings, and special situations, corporate governance investments, as well as founded and managed his own hedge fund. From 1981 to 1988, Mr. Corvese was with Drexel Burnham Lambert (“Drexel”) as an equity analyst following the chemical and specialty chemical industries and participated in a significant number of merger and acquisition activities. While at Drexel, Mr. Corvese was a member of the top chemical and specialty chemical research team, as ranked by Institutional Investor. Mr. Corvese currently serves on the Board of Directors of MiNK Therapeutics, Inc., the National Telecommunications Corporation, based in Cairo, Egypt, and Protagenic Therapeutics, an affiliate of Agenus, based in Ontario, Canada. Mr. Corvese earned degrees in finance and political science from The University of Rhode Island and attended New York University Graduate School. With over 30 years of experience in the financial industry, Mr. Corvese brings substantial financial, business and governance expertise to our Board.

 

 

Timothy R. Wright

Age: 65

Director since 2006,

Lead Director since 2009

(a) Compensation Committee

(b) Corporate Governance and Nominating Committee (Chair)

(c) Audit and Finance Committee

(d) Executive Committee

Mr. Wright is the former Chief Executive Officer of MiMedX Group, Inc. (“MiMedX”), a position that he held from May 2019 to September 2022. MiMedX is an advanced wound care and emerging therapeutic biologics company. Mr. Wright was also a Director of MiMedX from June 2019 to September 2022. Mr. Wright has also served as a Partner at Signal Hill Advisors, LLC since February 2011. Mr. Wright also serves as chairman of The Ohio State University Comprehensive Cancer Center Drug Development Institute that he founded in 2011, and director of the Ohio State University Innovation Foundation. Mr. Wright was the President and Chief Executive Officer and a director of M2Gen Corp., a privately held health informatics company, between July 2017 and September 2018. From April 2015 through July 2017, Mr. Wright was the Executive Vice President, Mergers and Acquisitions, Strategy and Innovation at Teva Pharmaceuticals Industries Ltd. From September 2013 to March 2015, Mr. Wright served as head of The Ohio State University Technology Transfer Office. From July 2011 to July 2012, Mr. Wright served as Chairman, Interim CEO, and a member of the Board of Directors of Curaxis Pharmaceuticals Corporation, a research based company dedicated to finding cures for age-related diseases, including Alzheimer’s disease and cancer. Prior to Mr. Wright’s tenure at Curaxis, the company had been experiencing financial difficulties and, as a result, Curaxis filed for Chapter 11 bankruptcy in July 2012.

 

 

 

Prior to that, Mr. Wright served as President of the Imaging Solutions and Pharmaceutical Products Sector of Covidien from February 2007 until December 2010. Mr. Wright brings to our Board over 30 years of global pharmaceutical industry experience in general management, product development, and commercialization as well as business restructuring and transaction experience. Beginning in April 2004, Mr. Wright was interim CEO, President and a member of the Board of Directors of AAI Pharma, a hybrid pharmaceutical, drug delivery/manufacturing, and global clinical research organization. Upon the sale of AAI Pharma’s pharmaceutical assets to Xanodyne Pharmaceuticals Inc., Mr. Wright transitioned to Chief Operating Officer at Xanodyne Pharmaceuticals Inc., a role he maintained until May 2006. Mr. Wright was also President of Elan Bio-Pharmaceuticals and has held several senior management positions with Cardinal Health Inc. and Dupont Merck Pharmaceutical Company. Over his career, Mr. Wright has served on ten Boards of Directors, including six in North America and four in Europe and Asia. Mr. Wright earned his bachelor’s degree from The Ohio State University. Mr. Wright’s global and extensive biotechnology, pharmaceuticals and life sciences operating experience combined with his professional Board experience brings important insight to Agenus.

 

11


 

Vote Required

The three nominees for director receiving the highest number of votes FOR election will be elected as directors. This is called a plurality. If your shares are held by your broker, bank, or nominee in “street name” and if you do not vote your shares or instruct your broker, bank, or nominee how to vote with respect to this item, your unvoted shares will be counted as “broker non-votes.” “Broker non-votes” are not counted for purposes of electing directors. You may vote FOR each of the nominees, WITHHOLD your vote from each of the nominees or WITHHOLD your vote from any one of the nominees. Votes that are withheld will not be included in the vote tally for the election of directors and will have no effect on the results of the vote.

The Board of Directors recommends a vote FOR each of the nominees for Director.

12


 

OUR CORPORATE GOVERNANCE

Our Commitment to Good Corporate Governance

We believe that good corporate governance and an environment of high ethical standards are essential for Agenus to achieve business success and to create value for our stockholders. The Board is committed to high governance standards and to continually working to improve them. We regularly review our corporate governance practices in light of ongoing changes in applicable law and evolving best practices. In 2022, the committee charters for the Audit and Finance Committee, Compensation Committee, and Corporate Governance and Nominating Committee were all updated to ensure they comport with current standards and best practices.

Role of Our Board

The Board monitors our overall corporate performance, the integrity of our financial controls, risk management and legal compliance procedures. It appoints senior management and oversees succession planning and senior management’s performance and compensation. The Board also oversees our short- and long-term strategic and business planning, and reviews with management its business plan, financing plans, budget, and other key financial and business objectives.

Members of the Board keep informed about our business through discussions with our Chief Executive Officer and other members of our senior management team, by reviewing materials provided to them by management on a regular basis and in preparation for Board and committee meetings, and by participating in meetings of the Board and its committees. Senior management regularly reviews key portions of our business and its progress with the Board. These practices afford the Board members the opportunity to actively participate in risk management assessment and raise questions and engage in discussions with management regarding areas of potential risk and opportunities to mitigate such risk. The Audit and Finance Committee of the Board reviews the risk management practices of the Company and in particular the Company's approach to cyber risks and mitigation efforts, and both the Corporate Governance and Nominating Committee and the Audit and Finance Committee receive periodic updates from the Company’s senior management outlining areas of compliance focus and proposed recommendations. Additionally, the Compensation Committee reviews the Company’s executive compensation program and the incentives created by the executive compensation program, to assess whether our compensation arrangements encourage excessive or properly calibrate risk-taking by our executives.

We introduce our senior executives and other strategic employees to the Board so that the Board can become familiar with our key talent. Timothy R. Wright, our Lead Director, introduces each new Board member to our Corporate Governance policies and their responsibilities to the Company as a director. Each Board member receives a Board of Directors handbook that provides the director with a summary of these practices and policies.

Board Meetings and Attendance

In 2022, the Board met five times and acted by written consent thirteen times. During 2022, each of our directors attended at least 75% of (i) the meetings of the Board and (ii) all meetings of committees of the Board on which the director served, during the period in which they were directors. All of our Board members attended our 2022 Annual Meeting of Stockholders. We expect all of our Board members to attend the 2023 Annual Meeting.

Governance Guidelines

The Board is guided by our Guidelines on Significant Corporate Governance Issues (our “Governance Guidelines”). We believe our Governance Guidelines demonstrate our continuing commitment to good corporate governance. The Board reviews our Governance Guidelines from time to time, as needed, and when significant developments warrant a new review. Our Governance Guidelines are posted on the corporate governance section of our website at https://investor.agenusbio.com/corporate-governance. No material on our website is part of this proxy statement.

Performance of Our Board

We consider it important to continually evaluate and improve the effectiveness of the Board, its committees and its individual members. We do this in various ways. Each year, the Lead Director surveys the Board members to assess the effectiveness of the Board and its committees. Using these surveys, the Lead Director assesses the Board’s performance and the performance of individual members, and reports his conclusions to the full Board. The assessment also evaluates the Board’s effectiveness in reviewing executive management, conducting appropriate oversight and adding value to Agenus. Each of the Board’s standing committees also conducts annual self-evaluations.

13


 

At each Board meeting, each Board member has the opportunity to assess the effectiveness of the materials presented and the conduct of the meeting, and to offer suggestions for improvement at future meetings.

Code of Business Conduct and Ethics and Securities Trading Policies

The Board originally adopted our Code of Business Conduct and Ethics in 2003. The Board reviewed, revised, and updated the Code of Business Conduct and Ethics most recently in January 2023. The Code of Business Conduct and Ethics applies to all members of the Board and all employees of Agenus, including our Chief Executive Officer, and Principal Financial and Accounting Officer. In addition, Agenus has a Securities Trading Policy, which was updated and reviewed and approved by the Board in January 2023. Among other matters, both our Code of Business Conduct and Ethics and Securities Trading Policy prohibit the members of the Board and all employees of Agenus from buying or selling our securities while in possession of material, non-public information about the Company. Our Code of Business Conduct and Ethics and Securities Trading Policy are each posted on the corporate governance section of our website at https://investor.agenusbio.com/corporate-governance. No material on our website is part of this proxy statement. We intend to post on our website all disclosures that are required by law or Nasdaq listing rules concerning any amendments to our Code of Business Conduct and Ethics. Stockholders may request a free printed copy of our Code of Business Conduct and Ethics by writing to Investor Relations, Agenus Inc., 3 Forbes Road, Lexington, MA 02421.

ESG Charter

As an immuno-oncology company, we are driven by our commitment to help patients of today and tomorrow by developing medicines that seek to extend and improve quality of life. As we do so, our vision inspires us to support a sustainable Environmental, Social and Governance (ESG) strategy; one where the planet is healthy, people thrive, and society is inclusive. In February 2023, we issued our inaugural Environmental, Social, Governance Charter, which outlines the Company's commitment and process for defining and measuring progress of our stated commitment to environmental stewardship and sustainability, corporate social responsibility and corporate governance. Our Environmental, Social, Governance Charter is posted on the corporate governance section of our website at https://investor.agenusbio.com/corporate-governance. No material on our website is part of this proxy statement.

Independence of Directors

Our Governance Guidelines and Nasdaq listing rules provide that a majority of the Board should be composed of independent directors. The Corporate Governance and Nominating Committee annually reviews the independence of the directors and reports to the Board which directors it recommends that the Board determine are independent. The Board then makes the final determination. The Board takes into account Nasdaq listing rules, applicable laws and regulations, and other factors in making its determinations including potential conflicts of interest, related party transactions, and other relationships that would reasonably be expected to compromise a director’s independence. The Board has determined that Mr. Corvese, Ms. Hirsch, Ms. Jeynes-Ellis, Mr. Wiinberg, and Mr. Wright are currently independent directors. Dr. Armen is currently not an independent director because he is employed as our Chief Executive Officer. In making independence determinations with regard to other directors, the Board considered related party transactions between us and a director or a director’s affiliates and any positions a director holds with entities with commercial relationships with us.

Executive Sessions of Independent Directors

Our independent directors typically meet in executive session without management present immediately after regularly scheduled Board meetings. Four such meetings were held during 2022.

Leadership Structure of the Board

Mr. Wright, an independent director, serves as the Lead Director of the Board and as Chair of the Corporate Governance and Nominating Committee. Mr. Wright also serves on the Compensation Committee, the Audit and Finance Committee and the Executive Committee. In addition to the duties of all directors, the specific responsibilities of the Lead Director include: (i) acting as chair of the Corporate Governance and Nominating Committee; (ii) developing the agenda for and presiding over all executive sessions of the independent directors; (iii) acting as principal liaison between the independent directors and the Chief Executive Officer on sensitive issues and raising at any meeting of the Board items that are not appropriately or best put forward by the Chief Executive Officer; and (iv) communicating to the Chief Executive Officer the independent directors’ annual evaluation of the Chief Executive Officer. The Company’s Chief Executive Officer serves as the Chairman of the Board. We believe that the Company’s Chief Executive Officer is best situated to serve as Chairman because he is the director most familiar with the Company’s business, and most capable of effectively identifying strategic priorities and leading the discussion and execution of our Company’s strategy. Our independent directors and management have different perspectives and roles in strategy development. The Company’s independent directors bring experience, oversight, and expertise from outside the Company and from inside and outside the

14


 

Company’s industry, while the Chief Executive Officer brings Company-specific experience and expertise. To assure effective independent oversight, the Company has adopted a number of governance practices, including:

a strong, independent, clearly-defined Lead Director role (as described above);
executive sessions of the independent directors held periodically; and
an annual performance evaluation of the Chairman/Chief Executive Officer by the independent directors.

While there may be circumstances in the future that would lead the Company to separate the offices of Chairman and Chief Executive Officer, we do not believe this is currently necessary due to the nature and size of the operations of the Company, the overall independence of the Board from management, and the strength of the Lead Director’s role on the Board.

Committees of the Board

The Board currently has four standing committees: the Audit and Finance Committee, the Compensation Committee, the Corporate Governance and Nominating Committee and the Executive Committee. The Board also appoints from time to time ad hoc committees to address specific matters.

Audit and Finance Committee

 

 

Members:

Meetings in 2022: 5

Ulf Wiinberg, Chair

Susan Hirsch

Timothy R. Wright

Action by written consent in 2022: 2

The Audit and Finance Committee consists entirely of independent directors within the meaning of the Nasdaq listing rules and the requirements contemplated by Rule 10A-3 of the Securities Exchange Act of 1934, as amended (the “1934 Act”). During the entirety of 2022, Mr. Wiinberg (Chair), Mr. Wright and Wadih Jordan were members of the Audit and Finance Committee. Mr. Jordan retired from the Board as of December 31, 2022. The Board determined that Mr. Wiinberg qualifies as an audit committee financial expert. The Audit and Finance Committee’s primary function is to assist the Board in monitoring the integrity of our consolidated financial statements and our system of internal control. The Audit and Finance Committee has direct responsibility for the appointment, independence, and monitoring of the performance of our independent registered public accounting firm. The committee is responsible for pre-approving any engagements of our independent registered public accounting firm, and all related party transactions. The committee also reviews our risk management practices, cyber-security program and mitigation, strategic tax planning, preparation of quarterly and annual financial reports, and compliance processes.

The Audit and Finance Committee members meet regularly with our independent registered public accounting firm, without management present and with members of management in separate private sessions, to discuss any matters that the committee or these individuals believe should be discussed privately with the committee, including any significant issues or disagreements concerning our accounting practices or consolidated financial statements. The committee also reviewed and approved the Company's updated Code of Business Conduct and Ethics, and our Securities Trading Policy, among others, in 2022. The committee conducts a meeting each quarter to review our consolidated financial statements prior to the public release of earnings. The committee has the authority to engage special legal, accounting or other consultants to advise the committee. The committee also has the authority to delegate to subcommittees any responsibilities of the full committee. The Audit and Finance Committee charter was updated in 2022, and is posted on the corporate governance section of our website at https://investor.agenusbio.com/corporate-governance. No material on our website is part of this proxy statement. Please also see the Report of the Audit and Finance Committee on page 54.

Compensation Committee

 

 

Members:

Meetings in 2022: 2

Brian Corvese, Chair

Timothy R. Wright

Allison Jeynes-Ellis

Action by written consent in 2022: 17

The Compensation Committee consists entirely of independent directors within the meaning of applicable Nasdaq listing rules and “non-employee directors” for purposes of Rule 16b-3 under the 1934 Act. During the entirety of 2022, Mr. Jordan (former Chair),

15


 

Mr. Corvese (current Chair) and Mr. Wright were members of the Compensation Committee. Mr. Jordan retired from the Board as of December 31, 2022. The committee’s primary purpose is to approve, administer and interpret our executive, key employee and director compensation programs, benefit policies, compensation philosophy and engagement with external compensation consultants. The committee reviews, determines and approves the compensation of the Chief Executive Officer, all other executive officers and certain other key employees. It also reviews and recommends compensation for members of the Board. Additionally, the committee makes recommendations to the Board regarding the adoption of new incentive compensation and equity-based plans and administers existing incentive compensation and equity-based plans.

The Compensation Committee considers data from other companies for compensation comparison purposes and retained an outside compensation consultant in 2022, Aon Consulting, Inc. through its Human Capital Solutions Subdivision (“Aon Radford”), to review the Company's compensation philosophy, create a relevant comparator peer group based on a number of relevant factors, and evaluate our executive and board compensation programs. The committee has the authority to retain legal, accounting, or other consultants to advise the committee on executive and board compensation issues that may arise. The committee also has the authority to delegate to subcommittees any responsibilities of the full committee. The Compensation Committee charter was updated in 2022, and is posted on the corporate governance section of our website at https://investor.agenusbio.com/corporate-governance. Please also see the Compensation Discussion and Analysis starting on page 19, and the accompanying Compensation Committee Report on page 25. No material on our website is part of this proxy statement. Aon Radford does not provide any services to the Company or the Compensation Committee other than those described above. After consideration of the six independence assessment factors provided under the listing rules of Nasdaq, the Compensation Committee determined that Aon Radford, as an advisor to the Compensation Committee during 2022, was independent and that the work performed by Aon Radford did not raise any conflicts of interest in 2022 that would preclude the Compensation Committee from reviewing and considering Aon Radford’s analyses when making compensation decisions.

Corporate Governance and Nominating Committee

 

 

Members:

Meetings in 2022: 2

Timothy R. Wright, Chair

Brian Corvese

Ulf Wiinberg

Action by written consent in 2022: 0

The Corporate Governance and Nominating Committee consists entirely of independent directors within the meaning of applicable Nasdaq listing rules. During 2022, the Corporate Governance and Nominating Committee consisted of Mr. Wright (Chair), Mr. Corvese and Mr. Wiinberg. The Corporate Governance and Nominating Committee is responsible for recommending to the Board policies relating to the conduct of Board affairs, the process for annual evaluation of the Board and the Chief Executive Officer, issues of corporate public responsibility, and overseeing the Company’s management succession planning process. It periodically evaluates the composition of the Board and its committees, the contributions of individual directors, and the Board’s effectiveness as a whole. The committee reviews the Company’s ethics and compliance activities under the Code of Business Conduct and Ethics which was reviewed and updated in 2022. The committee also oversaw the creation of the Company's ESG initiative in 2022.

The Corporate Governance and Nominating Committee recommends to our full Board individuals to serve as directors. The committee recommends to the Board guidelines and criteria for Board membership and reviews with the Board, on a periodic basis, the appropriate skills and characteristics required of Board members in the context of the then current needs of Agenus. The committee is responsible for reviewing with the Board the appropriate personal characteristics and professional competencies preferred of Board members, who are expected to work together as a team to properly oversee our strategies and operations. In general, all directors are expected to possess certain personal characteristics necessary to create a highly functional and collegial Board, which include personal and professional integrity, practical wisdom and mature judgment, an inquisitive and objective perspective, and time availability for performing the duties of a director.

The Board, as a group, is expected to encompass a range of talents, ages, skills, diversity, and expertise sufficient to provide sound and prudent guidance with respect to the operations and interests of our business. Examples of desired professional competencies include accounting and financial literacy, clinical drug development experience, industry knowledge, medical or scientific knowledge, and management experience. When evaluating potential new Board appointments, the Corporate Governance and Nominating Committee considers these factors, but does not have any fixed criteria for candidates it recommends because the Board believes that a flexible evaluation process allows the committee to make sound judgments based on the needs of the organization and specific attributes of each candidate without a need for a formal policy current. Candidates should also be enthusiastic about service on our Board and working collaboratively with existing Board members to create value for all of our stockholders.

16


 

The Corporate Governance and Nominating Committee does not have a formal policy with regard to the consideration of director candidates recommended by stockholders because it does not believe such a policy is necessary given that no unaffiliated stockholder has ever recommended a director candidate. When considering director candidates, the Corporate Governance and Nominating Committee, in consultation with the Chief Executive Officer and full Board, considers the current strengths on the existing Board, the current needs of the organization, and anticipated future activities and requirements of both the Board and the organization as a whole. Historically, director candidates have been generally identified primarily through referrals and the expansive and diverse professional network pool of the Board and senior executives. If the committee were to receive a recommendation for a director candidate from a stockholder, the committee expects that it would evaluate such a candidate using the criteria described above. The committee will consider a recommendation only if appropriate biographical information and background material is provided on a timely basis, accompanied by a statement as to whether the stockholder or group of stockholders making the recommendation has beneficially owned more than 5% of our common stock for at least one year as of the date that the recommendation is made. To submit a recommendation for a nomination, a stockholder may write to the Lead Director, Agenus Inc., 3 Forbes Road, Lexington, Massachusetts 02421, Attention: Lead Director.

In addition, our bylaws permit stockholders to nominate individuals, without any action or recommendation by the committee or the Board, for election as directors at an annual meeting of stockholders. For a description of this bylaw provision, see Additional Information on page 55 of this proxy statement. The committee updated its charter of the Corporate Governance and Nominating Committee in 2022, which is posted on the corporate governance section of our website at https://investor.agenusbio.com/corporate-governance. No material on our website is part of this proxy statement.

Nasdaq Diversity Matrix

The following matrix provides race/ethnicity, as well as gender, of the members of our Board, as self-identified by members of our Board.

 


Board Diversity Matrix (As of April 28, 2023)

Total Number of Directors: 6

 

 

 

Female

 

Male

 

Non-Binary

 

Did Not Disclose Gender

Part I Gender Identity

 

 

 

 

 

 

 

 

Directors

 

2

 

4

 

-

 

-

Part II: Demographic Background

 

 

 

 

 

 

 

 

African American or Black

 

-

 

-

 

-

 

-

Alaskan Native or Native American

 

-

 

-

 

-

 

-

Asian

 

-

 

-

 

-

 

-

Hispanic or Latinx

 

-

 

-

 

-

 

-

Native Hawaiian or Pacific Islander

 

-

 

-

 

-

 

-

White

 

2

 

3

 

-

 

-

Middle Eastern

 

-

 

1

 

-

 

-

Scandinavian

 

-

 

1

 

-

 

-

Two or More Races or Ethnicities

 

-

 

-

 

-

 

-

LGBTQ+

 

-

 

-

 

-

 

-

Did Not Disclose Demographic Background

 

-

 

-

 

-

 

-

 

Communications with the Board

You may contact the Board or any committee of the Board by writing to Board of Directors (or specified committee), Agenus Inc., 3 Forbes Road, Lexington, Massachusetts 02421, Attn: Lead Director. You should indicate on your correspondence that you are an Agenus stockholder. Communications will be distributed to the Lead Director, the appropriate committee chairman, or other members of the Board or executive management, as appropriate, depending on the facts and circumstances stated in the communication received. Executive management will generally determine the proper response to inquiries of a commercial nature, which generally will not be forwarded to the Lead Director. Inquiries regarding accounting, internal controls over financial reporting,

17


 

or auditing matters will be forwarded to the Chair of the Audit and Finance Committee, and inquiries involving matters governed by the Code of Business Conduct and Ethics will be forwarded to the Chair of the Corporate Governance and Nominating Committee.

Compensation Committee Interlocks and Insider Participation

The members of the Compensation Committee for the year ended December 31, 2022 were Mr. Jordan (former Chair), Mr. Corvese (current Chair), and Mr. Wright. No member of the Compensation Committee was at any time during 2022, or formerly, an officer or employee of Agenus or any subsidiary of Agenus. No executive officer of Agenus has served as a director or member of a compensation committee (or other committee serving an equivalent function) of any other entity while an executive officer of that other entity served as a director of Agenus or member of the Compensation Committee.

Our Executive Officers

Garo H. Armen, Ph. D.Chairman and Chief Executive Officer—Dr. Armen, 70, has been our Chairman and Chief Executive Officer since our founding in 1994. From our founding until December 2019, Dr. Armen also served as our President. Additional biographical information on Dr. Armen is set forth on page 11 above.

Steven O’Day, MDChief Medical Officer—Dr. O’Day, 61, has been our Chief Medical Officer since January 2021. Dr. O’Day is a pioneer in CTLA-4 inhibition, and has been the principal investigator in more than 200 clinical trials. From 2015 until joining Agenus, was Director of Immuno-Oncology and Director of Clinical Research at John Wayne Cancer Institute at Providence Saint John’s Health Center. Dr. O’Day received his medical degree in 1988 from Johns Hopkins School of Medicine and his BA in Chemistry from Williams College in 1983. Additionally, Dr. O’Day did his medical oncology fellowship at the Dana Farber/Harvard Cancer Center.

Christine M. KlaskinVice President of Finance—Ms. Klaskin, 57, has been our Vice President, Finance since October 2006. Since joining Agenus Inc. in 1996 as finance manager, Ms. Klaskin has held various positions within the finance department and has been involved in all equity and debt offerings of the Company including its IPO. Additionally, Ms. Klaskin serves as the Treasurer of MiNK Therapeutics, Inc. Prior to joining Agenus, Ms. Klaskin was employed by Arthur Andersen as an audit manager. Ms. Klaskin received her Bachelor of Accountancy from The George Washington University.

Under our bylaws all of our executive officers are elected to their offices on an annual basis until the first meeting of our Board of Directors following our annual stockholder meeting. No family relationships exist among any of our directors or executive officers.

18


 

COMPENSATION DISCUSSION AND ANALYSIS

This section discusses the compensation of the executive officers who are named in the “Summary Compensation Table” below and who are referred to throughout this proxy statement as our “named executive officers,” and the material factors relevant to an understanding of their compensation in 2022. Our named executive officers for 2022 are:

Dr. Garo H. Armen—Chairman and Chief Executive Officer;
Dr. Steven J. O’Day—Chief Medical Officer; and
Ms. Christine M. Klaskin—Vice President of Finance.

 

Executive Summary

This section provides information on the compensation of our named executive officers and the key factors relevant to understanding their compensation in 2022. Our named executive officers for 2022 are Dr. Garo H. Armen, Chairman and Chief Executive Officer; Dr. Steven J. O’Day, Chief Medical Officer; and Ms. Christine M. Klaskin, Vice President of Finance.

Our executive compensation program is designed to attract and retain top talent, reward strong performance, and align incentives with the creation of long-term shareholder value, while also considering the Company’s resource constraints. The short-term compensation (base salary and target annual incentive bonuses) for our named executive officers is positioned competitively approximately within the 50th percentile of our compensation peer group. Our long-term incentive programs are designed to preserve cash resources, encourage long-term decision-making and value creation, and reward stock price appreciation.

In 2022, we and our subsidiaries exceeded most of our annual goals set under our corporate performance goals. We achieved significant clinical, research, and operational goals, such as presenting new clinical responses from a Phase 1/2 trial of botensilimab, launching several randomized Phase 2 studies for botensilimab, and completing the sale of parcels of land we own in Vacaville, CA for a total of approximately $24M. Our incentive compensation programs were administered in a manner consistent with our operating performance, long-term objectives, and compensation philosophy. Based on the Company’s overall performance in 2022, the annual incentive bonuses earned by our named executive officers ranged from 100% to 151% of their target bonus amounts, prior to adjusting for the multiplier applied as a result of the payment of these bonuses in shares of our stock rather than cash.

Compensation Philosophy

Our executive compensation program is designed to attract and retain high-caliber talent while aligning their incentives with the creation of long-term shareholder value. We aim to manage the risks and challenges inherent to a biotechnology company of our size and stage of development by combining short- and long-term elements, cash and equity compensation, and fixed and variable compensation. We incentivize our executives to achieve various research, clinical, and operational goals, as a means to creating long-term shareholder value, including building a high-performing team, demonstrating leadership and innovation, managing multiple dimensions of our business, and identifying and addressing our short- and long-term operational needs and financial position.

Our philosophy is to emphasize equity over cash compensation and long-term over short-term compensation. We aim to be competitive within our industry and fair relative to other professionals within our organization. Our executive compensation program's base salaries, target annual incentive bonus levels, and target annual long-term incentive award values are set at levels competitive with those of our peer group. We continually review our executive compensation program to ensure that it rewards executives appropriately and provides compensation at market-competitive levels.

To compete for top-tier executive talent in the biotechnology industry, we monitor market trends and draw upon compensation surveys prepared by Aon Radford, our Compensation Committee's independent compensation consultant, custom research developed by Aon Radford, and other nationally recognized compensation surveys. Our Compensation Committee engages Aon Radford annually to evaluate our executive compensation program and compare it to other programs in the market. We define our market using two market references for 2022: the Radford Global Life Sciences Survey and proxy data from a peer group of biotechnology companies. Our Compensation Committee approves a group of comparable companies as our peer group for executive and director compensation purposes.

We believe that our executive compensation program appropriately rewards our executives for achieving our goals and objectives, provides compensation at market-competitive levels, and presents no risks that are reasonably likely to have a material adverse effect on the Company.

Competitive Market Review

To determine our position relative to the appropriate market reference, we compare our executive compensation program and compensation amounts against our peer group. We review each compensation component (measured at target for annual and long-term incentive opportunities) and total compensation. These comparisons help us approximate our position relative to the market reference for each element of compensation and in total.

19


 

Market References: How We Define Market and How We Use Market Compensation Data. Our Compensation Committee has engaged Aon Radford since 2016 as its independent compensation consultant to evaluate our executive compensation program and compare it to other programs in the market.

Defining the Market. For 2022, we used two market references to evaluate our executive compensation program against those in the market:

1.
The Radford Global Life Sciences Survey, a national survey of executive compensation levels and practices. We focused primarily on a pre-determined subset of companies in our sector with between 175 and 1,500 employees and a market capitalization between $300 million to $3.0 billion (average market capitalization of approximately $1.2 billion).
2.
Proxy data from a peer group of biotechnology companies of a similar headcount, market capitalization, development stage and therapeutic focus as the Company.

On an annual basis, our compensation consultant recommends, and our Compensation Committee approves, a group of comparable companies as our peer group for executive and director compensation purposes. Based on discussions with, and the recommendation of, Aon Radford, our Compensation Committee selected a peer group for purposes of 2022 compensation determinations that removed eight companies from the prior year’s peer group and added seven new companies. Our peer groups for 2021 and 2022 were as follows:

2021 Peer Group

2022 Peer Group

Atara Biotherapeutics, Inc.

Arcus Biosciences, Inc.

Athenex, Inc.

Arvinas, Inc.

Corbus Pharmaceuticals Holdings, Inc.

Atara Biotherapeutics, Inc.

Cytokinetics, Incorporated

Deciphera Pharmaceuticals, Inc.

Deciphera Pharmaceuticals, Inc.

Fate Therapeutics, Inc.

Dicerna Pharmaceuticals, Inc.

ImmunoGen, Inc.

Epizyme, Inc.

Inovio Pharmaceuticals, Inc.

Fate Therapeutics, Inc.

Instil Bio, Inc.

ImmunoGen, Inc.

Iovance Biotherapeutics, Inc.

Inovio Pharmaceuticals, Inc.

Karyopharm Therapeutics Inc.

Karyopharm Therapeutics Inc.

MacroGenics, Inc.

MacroGenics, Inc.

Mersana Therapeutics, Inc.

NantKwest, Inc.

Precision BioSciences, Inc.

Precision BioSciences, Inc.

Seres Therapeutics, Inc.

Seres Therapeutics, Inc.

SpringWorks Therapeutics, Inc.

Syndax Pharmaceuticals, Inc.

Syndax Pharmaceuticals, Inc.

Syros Pharmaceuticals, Inc.

TG Therapeutics, Inc.

TG Therapeutics, Inc.

Voyager Therapeutics, Inc.

Voyager Therapeutics, Inc.

Zentalis Pharmaceuticals, Inc.

ZIOPHARM Oncology, Inc.

 

Determining Market Levels and Specific Comparisons. We compare our executive compensation program and amounts of compensation against our peer group by reviewing each compensation component (measured at target in the case of annual and long-term incentive opportunities) and total compensation. The comparisons made in this process are used to determine our approximate position relative to the appropriate market reference by each element of compensation and in total.

Total Compensation Strategy

Our compensation strategy aims to offer our executives competitive compensation packages, with an opportunity to earn above-market pay for exceptional performance. To maintain our competitive pay philosophy, we prioritize long-term equity incentives and performance-based incentive compensation.

Our target for total compensation is generally at the 50th percentile of our peer group, which includes annual base salary, target annual incentive bonus, and the grant date value of equity awards. The actual competitive posture of our annual compensation may vary year to year based on individual and company performance, as well as the performance of our peer group and their executive compensation practices. Nonetheless, we plan to continue targeting total compensation at approximately the 50th percentile of our peer group, with an emphasis on performance-based compensation.

The competitive posture of our actual annual compensation paid or earned versus market references will vary year to year based on Company and individual performance, as well as the performance of our peer group and the respective levels of compensation paid by peer group companies to their executives. We expect to continue targeting total compensation at approximately the 50th percentile

20


 

of our peer group, with an emphasis on performance-based compensation. Further, in light of our compensation philosophy, we believe that the total compensation package for our executives should continue to consist of base salary, annual incentive bonuses, long-term equity-based incentive compensation, and certain other benefits.

Executive Compensation Program

Components of our Executive Compensation Program

Our executive compensation program follows the same structure as that of non-executive members of the Agenus management team. For short-term compensation, we offer base salary and annual incentive bonuses targets that recognize the experience, skills, knowledge, and responsibilities of each executive, while also considering competitive market conditions.

For newly hired executives, we also consider any relevant unique personal circumstances that motivated them to join Agenus and what we have historically paid for the same or similar roles, in addition to base salaries for corresponding positions within our peer group and the competitive market. When executives are newly promoted to a position, we consider their prior salary and experience, along with base salaries for corresponding positions within our peer group and the competitive market. If an executive does not have the same level of experience at the time of promotion as a counterpart hired from outside the Company would, we may implement a multi-step approach to bringing their base salary in line with targeted levels. Base salary increases at each of these steps will be contingent on the continued strong performance of the executive.

We review the base salaries of our executives annually and adjust them to reflect the executive’s performance, competitive market conditions, and market data. Increases are considered within the context of our overall annual financial position before more specific individual and market competitive factors are considered. We do not use specific formulas to determine base salary increases.

Short-Term Compensation.

Our short-term compensation program consists of base salary and annual incentive bonuses. Base salary provides a fixed rate of base compensation to recognize the experience, skills, knowledge, and responsibilities of each executive, and takes into account competitive market conditions.

Base Salary: Base salaries for our executive officers are generally positioned at or around the 50th percentile of our peer group (see “Competitive Market Review” above for further information on our peer group).. We consider various factors, such as an executive's seniority, experience, position and functional role and responsibilities, as well as peer group and competitive market data, when establishing base salaries.

As of January 1, 2022, our Compensation Committee approved an increase to Dr. Armen’s base salary from $655,000 to $687,750 (a 5% increase), an increase to Dr. O’Day’s base salary from $550,000 to $572,000 (a 4% increase), and an increase to Ms. Klaskin’s base salary from $275,725 to $286,754 (a 4% increase) during its annual review of executive compensation matters and approval of annual long-term incentive awards for all employees.

 

Named Executive Officer

 

2022 Base Salary

 

Dr. Armen

 

$

687,750

 

Dr. O’Day

 

$

572,000

 

Ms. Klaskin

 

$

286,754

 

In January 2023, our Compensation Committee approved increases to the base salaries of our named executive officers. Dr. Armen’s base salary increased from $687,750 to $715,260 (a 4% increase), Dr. O’Day’s base salary increased from $572,000 to $594,880 (a 4% increase), and Ms. Klaskin’s base salary increased from $286,754 to $298,224 (a 4% increase). These increases were effective as of March 6, 2023.

Annual Incentive Bonuses: Our executive officers' annual incentive bonuses are based on the achievement of Company goals and objectives as well as individual performance and are paid under our Executive Incentive Plan. Each executive is eligible to earn an annual incentive bonus ranging from 0-200% of their target bonus based on our Compensation Committee’s evaluation of the achievement of Company goals and objectives and individual performance.

For 2022, each of our named executive officers was eligible to receive an annual incentive bonus. The target bonus amount for each executive was expressed as a percentage of their base salary, and it was set based on market data and our Compensation Committee’s assessment of the achievement of pre-established Company goals and objectives as well as individual performance. The target bonuses for our named executive officers remained unchanged from 2021.

 

Named Executive Officer

 

2022 Target Bonus
(% of base salary)

 

Dr. Armen

 

 

60

 

Dr. O’Day

 

 

50

 

Ms. Klaskin

 

 

30

 

 

21


 

 

In March 2023, the Compensation Committee approved an increase in the amount of Ms. Klaskin's target bonus amount from 30% to 35% in connection with its annual review of executive compensation matters and approval of annual longer-term incentive awards for all employees.

The Company sets annual goals and objectives at the beginning of each year with input from executives, and they are reviewed and approved by the Compensation Committee and the Board. In 2022, the Company achieved significant goals and objectives, including presenting new clinical responses from a Phase 1/2 trial of botensilimab, launching ongoing randomized Phase 2 studies for botensilimab in several refractory cancer types, filing an IND for AGEN1571 and observing early clinical benefit in AGEN2373, entering into multiple collaborations to evaluate assets in externally funded clinical combinations with other investigational products, and completing the construction of a new commercial GMP manufacturing facility in Emeryville, California.

Additionally, the Company collected milestone payments based on sales of GSK Shingrix vaccine containing QS-21 STIMULON as part of its vaccine adjuvant and clinical milestone payments from Gilead under the AGEN 2373 option agreement. It also completed the sale of parcels from the land it owns in Vacaville, CA and restructured operating expenses to improve operational efficiency and focus on the most promising development candidates.

The Company's subsidiary, SaponiQx, achieved milestones in 2022, such as entering into a clinical collaboration and supply agreement with Targovax ASA, the FDA accepting GSK's BLA for their respiratory syncytial virus older adult vaccine candidate, and completing GMP manufacturing of QS-21 STIMULON. The Company's publicly traded subsidiary, MiNK, presented early activity for its allogeneic, native iNKT cell therapy agenT-797 as a monotherapy and in combination with anti PD-1 inhibitors in solid tumors and viral ARDS. MiNK-413, an IL-15 armored CAR-iNKT program targeting B cell maturation antigen, demonstrated tumor clearance in preclinical models, while MiNK 214, an IL-15 armored tumor stromal targeting FAP-CAR-iNKT program, showed robust efficacy in NSCLC and melanoma preclinical models and is advancing in IND enabling studies.

While there is no set formula or specified weighting of the Company goals and objectives under the annual bonus program, in determining annual incentive bonus payouts, the Compensation Committee takes into account the achievement of the goals and objectives as a whole. At the end of the year, our Chief Executive Officer, with input from management, prepares a report outlining the extent to which Company goals and objectives were achieved and presents that report to our Compensation Committee along with a recommendation on the executives’ annual incentive bonus payout levels (other than with respect to his own), as a percentage of their target bonuses. Our Compensation Committee evaluates the report, along with any relevant supporting documentation, and considers it in the context of any change in facts or circumstances that could have impacted goal attainment throughout the year. From time to time, our Compensation Committee may request supplemental information from management to support the Compensation Committee’s evaluation. Based on this evaluation, as well as the Company’s available financial resources, our Compensation Committee exercises its discretion to determine the appropriate level for the executives’ annual incentive bonus payouts. Once determined, the recommended bonus payout level is applied to each executive’s target bonus percentage to establish his or her annual incentive bonus payout. Our Compensation Committee may exercise further discretion to adjust the actual bonus paid to any individual executive based on his or her individual performance and its impact on the Company’s overall performance (with input from our Chief Executive Officer, other than with respect to his own bonus), which it did in 2022, as described below under “2022 Compensation Actions for our Named Executive Officers.”

In determining the annual incentive bonus payouts for our executive officers for 2022, our Compensation Committee determined that the majority of the Company’s pre-established goals and objectives for 2022, as described in general detail above, were accomplished. Our Compensation Committee noted that these accomplishments were made in a challenging economic environment in which the management team was under substantial resource constraints, and that the Company’s accomplishments in 2022 were critical in advancing the development of our diverse portfolio, reducing our reliance on contract manufacturing organizations, effectively managing our cost structure and advancing the Company towards potential commercialization.

For 2022, our Compensation Committee approved an annual incentive bonus payout for each of our named executive officers as follows: Dr. Armen at 151% of target and Dr. O’Day and Ms. Klaskin at 100% of target. In 2022, our Board determined to pay our employees, including our named executive officers, their annual incentive bonuses in the form of stock, in lieu of cash, with the number of shares of stock having a value of 150% of the employee’s annual incentive bonus that would have otherwise been paid in cash, determined based on the fair market value of our stock on January 5, 2023 ($2.45 per share, which was the closing price of our stock on January 5, 2023), the grant date for 2022 annual incentive equity bonus awards. These awards were made in the form of restricted stock and were immediately converted to fully vested shares of common stock subject to trading restrictions. The trading restrictions on 50% of each such stock award were removed on March 24, 2023 and the remaining trading restrictions will be removed on June 24, 2023. The table below shows for each of our named executive officers his or her target annual incentive bonus (as a percentage of base salary), actual annual incentive bonus received (as a percentage of base salary) and actual annual incentive bonus received (as a percentage of target), after giving effect to the multiplier applied as a result of the payment in shares of our stock. The amounts reported represent 150% of the equivalent cash bonus the Company would otherwise have paid to each of our named executive officers if the bonuses had instead been paid in cash.

22


 

 

Named Executive Officer

 

2022 Target Bonus
(% of base salary)

 

 

2022 Actual Bonus
(% of base salary)

 

 

2022 Actual Bonus
(% of target)

 

Dr. Armen

 

 

60

 

 

 

136

 

 

 

227

 

Dr. O’Day

 

 

50

 

 

 

75

 

 

 

150

 

Ms. Klaskin

 

 

30

 

 

 

45

 

 

 

150

 

Long-Term Incentives.

The Company's long-term incentives include time-vesting and performance-vesting stock options, restricted stock awards, and performance shares. These incentives are designed to reward performance and the achievement of key milestones or other performance goals that are important to the Company's success. The Company believes that time-vesting stock options are also performance-based because no value is created unless the value of the common stock appreciates after grant.

Equity-based awards are granted to executives and employees to enable them to participate in the long-term appreciation of the Company's stock and to align their interests with those of the stockholders. These awards are not granted automatically to executives on an annual basis. The Compensation Committee grants equity-based awards based on the executive’s and the Company's performance over time, their ability to impact the Company's results that drive stockholder value, their level within the organization, their potential to take on roles of increasing responsibility, and competitive equity award levels for similar positions in the peer group.

Initial and Promotional Long-Term Incentive Grants:

The size of the initial long-term incentive grant made to executives upon joining the Company or to current employees being promoted to executive positions is primarily based on competitive considerations applicable to the executive's specific position. The Compensation Committee considers the number of shares of common stock underlying equity-based awards held by other executives in comparable positions within the Company and has established long-term incentive guidelines for specified categories of executives.

Market Comparisons:

The Company uses several methodologies to make external comparisons when determining the number of options, shares of restricted stock, and/or performance shares to be granted to each executive. These methodologies include comparing the fair value of the grant (determined using methods that are consistent with the guidance in Accounting Standards Codification 718, Compensation—Stock Compensation), the face value of the grant, the number of shares of common stock underlying all options, restricted stock, and/or performance shares granted by position, and the proportion of exercisable to non-exercisable awards held in total. On a total Company basis, the Company analyzes total annual equity burn rates, the total number of shares remaining in the approved pool under the Equity Incentive Plan, and equity overhang.

Benefits.

The Company provides its employees the following benefits: health, vision, and dental insurance; life insurance; short- and long-term disability; flexible spending accounts; 401(k) plan; and Employee Stock Purchase Plan. The Company provides employer matching contributions equal to $0.50 for each $1.00 contributed by an employee under its 401(k) retirement plan. The Company believes that these benefits are consistent with those offered by companies against which it competes for talent.

Severance Compensation and Termination Protection.

We are party to employment agreements with Drs. Armen and O’Day. Additionally, we have entered into a change of control agreement with Ms. Klaskin. These agreements provide for severance compensation to be paid if the executive's employment or service is terminated under certain conditions, such as in connection with a change of control of the Company or a termination without cause by the Company, each as defined in the respective agreements. The agreements and severance compensation provisions are designed to meet certain objectives, such as maintaining management continuity in the event of a potential transaction and providing a mutually agreed-upon severance package that is in place prior to any termination event.

Prohibition Against Hedge and Offset Transactions

The Company's Securities Trading Policy prohibits its executive officers, directors, employees, and consultants, together with members of their household, from engaging in certain transactions, including selling securities they do not own, buying or selling derivative securities, and engaging in hedging transactions without pre-approval from the Chief Compliance Officer. None of the Company's executive officers has sought or obtained consent to engage in a hedging transaction as of the date of this document.

2022 Compensation Actions for our Named Executive Officers

The compensation actions for 2022 were determined by our Compensation Committee based on assessments of performance relative to Company goals and objectives and individual performance objectives, as well as comparisons against the market references described above. Our Chief Executive Officer, Dr. Armen, makes recommendations to the Compensation Committee regarding

23


 

individual compensation for our executives, excluding himself. In 2022, the Compensation Committee worked with our Chief People Officer and an independent compensation consultant (Aon Radford) to determine the specific compensation actions for our executives. The Compensation Committee makes all final determinations regarding the compensation of our executives, including our named executive officers.

Our compensation actions for our Chief Executive Officer and our other named executive officers are summarized as follows:

Dr. Garo H. Armen—Chairman and Chief Executive Officer

Base Salary: In January 2022, Dr. Armen’s base salary was increased from $655,000 to $687,750 per annum (a 5% increase).
Annual Incentive Bonus: In January 2023, our Compensation Committee approved an annual incentive bonus of $625,000 to reward Dr. Armen for his performance in 2022, which was equal to 151% of his target annual incentive bonus. Due to the Board’s decision to pay his annual incentive bonus in Company stock, Dr. Armen received Company stock with an aggregate value on the issue date equal to 227% of his target annual incentive bonus.
Long-Term Incentives: In January 2022, our Compensation Committee granted Dr. Armen an option to purchase 1,900,000 shares of our common stock, subject to a three-year vesting schedule where one-third of the options vest on the one-year anniversary of the grant date, with the remainder vesting in equal quarterly installments thereafter, generally subject to his continued employment or service with the Company; provided, however, that in the event of Dr. Armen’s death, disability, or retirement, such options shall vest in full.

Steven O’Day—Chief Medical Officer

Base Salary: In January 2022, Dr. O’Day’s base salary was increased from $550,000 to $572,000 per annum (a 4% increase).
Annual Incentive Bonus: In January 2023, our Compensation Committee approved an annual incentive bonus of $286,000 to reward Dr. O’Day for his performance in 2022, which was equal to 100% of his target annual incentive bonus. Due to the Board’s decision to pay his annual incentive bonus in Company stock, Dr. O’Day received Company stock with an aggregate value on the issue date equal to 150% of his target annual incentive bonus.
Long-Term Incentives: In January 2022, our Compensation Committee granted Dr. O'Day an option to purchase 150,000 shares of our common stock, subject to a three-year vesting schedule where one-third of the options vest on the one-year anniversary of the grant date, with the remainder vesting in equal quarterly installments thereafter, generally subject to his continued employment or service with the Company.

Christine M. Klaskin—Vice President, Finance

Base Salary: In January 2022, Ms. Klaskin’s base salary was increased from $275,725 to $286,754 per annum (a 4% increase).
Annual Incentive Bonus: In January 2023, our Compensation Committee approved an annual incentive bonus of $86,026 to reward Ms. Klaskin for her performance in 2022, which was equal to 100% of her target annual incentive bonus. Due to the Board’s decision to pay her annual incentive bonus in Company stock, Ms. Klaskin received Company stock with an aggregate value on the issue date equal to 150% of her target annual incentive bonus.
Long-Term Incentives: In January 2022, our Compensation Committee granted Ms. Klaskin an option to purchase 100,000 shares of our common stock, subject to a three-year vesting schedule where one-third of the options vest on the one-year anniversary of the grant date, with the remainder vesting in equal quarterly installments thereafter, generally subject to her continued employment or service with the Company.

Tax and Accounting Considerations

Section 162(m) of the Internal Revenue Code of 1986, as amended, generally disallows a federal income tax deduction for public corporations of remuneration in excess of $1 million paid in any fiscal year to certain specified executive officers, subject to certain transition rules. However, in designing our executive compensation program including our named executive officers compensation, the Compensation Committee considers a variety of factors, but believes that the primary purpose of our executive compensation is to provide market competitive compensation that effectively attracts and retains executive talent, and, as a result, has approved and will continue to approve compensation that is non-deductible or is limited in its deductibility.

24


 

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Board has reviewed and discussed with management the foregoing Compensation Discussion and Analysis, and based on such review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement on Schedule 14A for filing with the SEC.

 

By the Compensation Committee,

Brian Corvese (Chair)
Allison Jeynes-Ellis
Timothy R. Wright

The Compensation Committee of the Board consists entirely of independent directors who are not officers or employees of Agenus. The Compensation Committee charter is posted on the corporate governance section of our website at https://investor.agenusbio.com/corporate-governance. No material on our website is part of this proxy statement.

25


 

COMPENSATION OF NAMED EXECUTIVE OFFICERS

Summary Compensation Table

This table shows certain information about the compensation paid or awarded to, or earned by, our named executive officers for 2022, 2021, and, if applicable 2020.

 

Name and Principal Position

 

Year

 

Salary
($)
(1)

 

 

Bonus
($)
(4)

 

 

 

Stock Awards
($)
(5)

 

 

Option Awards
($)
(6)

 

 

 

All Other
Compensation
($)
(7)

 

 

Total
($)

 

 

Garo H. Armen, Ph.D.(2)

 

2022

 

 

689,010

 

 

 

625,000

 

 

 

 

312,500

 

 

 

3,999,800

 

(8)

 

 

 

 

 

5,626,310

 

(10)

Chief Executive Officer

 

2021

 

 

655,000

 

 

 

625,000

 

 

 

 

196,500

 

 

 

8,276,866

 

(8)

 

 

4,082

 

 

 

9,757,448

 

(10)

 

 

2020

 

 

677,267

 

 

 

393,000

 

 

 

 

 

 

 

4,563,132

 

(8)

 

 

3,845

 

 

 

5,637,244

 

(10)

Steven J. O’Day, M.D.

 

2022

 

 

572,423

 

 

 

286,000

 

 

 

 

130,625

 

 

 

313,500

 

 

 

 

8,700

 

 

 

1,311,248

 

(10)

Chief Medical Officer(3)

 

2021

 

 

539,423

 

 

 

891,250

 

(9)

 

 

323,000

 

 

 

610,362

 

 

 

 

8,700

 

 

 

2,372,735

 

(10)

Christine M. Klaskin

 

2022

 

 

287,178

 

 

 

86,026

 

 

 

 

39,291

 

 

 

209,000

 

 

 

 

6,630

 

 

 

628,125

 

(10)

Vice President, Finance

 

2021

 

 

275,725

 

 

 

78,581

 

 

 

 

36,000

 

 

 

178,320

 

 

 

 

6,206

 

 

 

574,832

 

(10)

 

 

2020

 

 

285,166

 

 

 

72,000

 

 

 

 

 

 

 

144,739

 

 

 

 

5,800

 

 

 

507,705

 

(10)

 

(1)
A portion of the amounts reported as base salary for 2022 and 2021 for Ms. Klaskin, who is also a named executive officer of MiNK Therapeutics, Inc. (“MiNK”), $27,244 and $20,019, respectively, were allocated to Ms. Klaskin’s services to MiNK in 2022 and 2021, and will also be reported as compensation in MiNK’s Summary Compensation Table. Due to a calendar anomaly, in 2020, Agenus had 27 pay periods rather than 26 pay periods, and the amounts reported as base salary for 2020 reflect such additional pay period.
(2)
As an employee-director, Dr. Armen receives no additional compensation for his service on the Board. The amount reported as base salary for Dr. Armen in 2020 and 2021 includes salary that was paid to Dr. Armen in the form of Agenus stock.
(3)
Dr. O’Day joined Agenus in January 2021.
(4)
Amounts reported reflect annual incentive bonuses for the applicable year. For 2022 and 2021, the amounts reported for Drs. Armen, and O’Day and Ms. Klaskin reflect the amount of the annual incentive bonus that would have been paid in cash, absent the Company’s decision to issue payment in the form of Agenus stock. Drs. Armen, and O’Day and Ms. Klaskin were granted shares of stock (subject to trading restrictions) in respect of their 2022 and 2021 annual incentive bonuses having a value on the date of grant equal to 150% of the amount of the annual incentive bonus listed in the table above. For 2022, based on the closing price of $2.45 on the date of grant, this resulted in their being granted 382,653, 175,108, and 52,669 shares, respectively, of fully vested Agenus stock. The grant date fair value of these incremental shares is not included in the stock awards column for 2022 because the shares were granted in 2023. For 2021, based on the closing price of Agenus stock of $2.51 on the date of grant, this resulted in the named executive officers being granted 373,505, 156,125, and 46,961 shares, respectively, of fully vested Agenus stock. The grant date fair value of these incremental shares is not included in the stock awards column for 2021 because the shares were granted in 2022. As such, the grant date fair value of these incremental shares is included in the stock awards column for 2022. For 2020, the amounts reported for Dr. Armen and Ms. Klaskin reflect the amount of the annual incentive bonus that would have been paid in cash, absent an election by the named executive officer to receive payment in the form of Agenus stock. Dr. Armen and Ms. Klaskin elected to receive payment of this bonus in the form of fully vested Agenus stock, and were granted shares of stock in respect of their 2020 annual incentive bonuses having a value on the date of grant equal to 150% of the amount of the annual incentive bonus listed in the table above, based on the closing price of Agenus stock of $2.87 on the date of grant, which resulted in their being granted 205,400, and 37,630 shares, respectively, of fully vested Agenus stock. The grant date fair values of these incremental shares are not included in the stock awards column for 2020 because the shares were granted in 2021. As such, the grant date fair value of these incremental shares is included in the stock awards column for 2021.
(5)
Amounts reported for each of our named executive officers for 2022 and for Dr. Armen and Ms Klaskin for 2021 reflect the incremental fair value of the shares granted in lieu of 2021 and 2020 bonus awards (as applicable) discussed in footnote 4 above, determined in accordance with ASC Topic 718, disregarding the effects of estimated forfeitures. The grant date fair value was calculated by multiplying the number of incremental shares of our common stock subject to the award by the closing price of a share of common stock on the grant date. The amount reported for 2021 for Dr. O’Day reflects the grant date fair value of the restricted stock unit award granted to him in January 2021 in connection with his hire in January 2021, determined in accordance with ASC Topic 718, disregarding the effects of estimated forfeitures. The grant date fair value was calculated by multiplying the number of restricted stock units subject to the award by the closing price of a share of our common stock on the grant date.
(6)
Amounts reported reflect the grant date fair value of options granted in the applicable year, determined in accordance with ASC Topic 718, disregarding the effects of estimated forfeitures. Please see Note 13 to our consolidated financial statements of our Annual Report on Form 10-K for the year ended December 31, 2022 for the assumptions used in valuing such awards.

26


 

(7)
Amounts reported for 2022 reflect matching contributions made under our 401(k) plan on behalf of Dr. O’Day and Ms. Klaskin
(8)
Amounts reported include the grant date fair value of options granted with respect to our subsidiary MiNK, which was $28,800 for 2022, $1,500,706 for 2021, and $1,484 for 2020, all determined in accordance with ASC Topic 718, disregarding the effects of estimated forfeitures. Please see Note 8 to the consolidated financial statements of MiNK'S Annual Report on Form 10-K for the year ended December 31, 2022 for assumptions used in valuing such awards.
(9)
The amount reported includes a sign-on bonus of $630,000 to Dr. O’Day.
(10)
The table below shows the cash compensation paid to each of our named executives. All other amounts included in the Summary Compensation Table represent non-cash compensation in the form of shares issued, and stock and options awarded, each valued in accordance with ASC Topic 718, disregarding the effects of estimated forfeitures. As discussed in footnotes 2 and 9 above, during 2021 and 2020, Dr. Armen received a portion of his salary in the form of Agenus stock, and in 2021, Dr. O’Day received a sign-on bonus.

Name

 

2022 ($)

 

 

2021 ($)

 

 

2020 ($)

 

Garo H. Armen, Ph.D.

 

 

689,010

 

 

 

488,777

 

 

 

385,461

 

Steven J. O’Day, M.D.

 

 

581,123

 

 

 

1,169,423

 

 

 

-

 

Christine M. Klaskin

 

 

293,808

 

 

 

281,931

 

 

 

290,966

 

Grants of Plan-Based Awards for Fiscal Year 2022

 

Executive Officer

 

Grant Date

 

All Other
Stock Awards:
Number of
Shares of
Stock or Units
(#)

 

 

All Other Option
Awards: Number
of Securities
Underlying
Options
(#)

 

 

Exercise or
Base Price
of Option
Awards
($/Share)

 

 

Grant Date Fair
Value of Stock
and Options
Awards
($)
(3)

 

Garo H. Armen, Ph.D

 

01/02/2022(1)

 

 

 

 

 

1,900,000

 

 

 

3.22

 

 

 

3,971,000

 

 

02/02/2022(2)

 

 

124,502

 

 

 

 

 

 

 

 

 

312,500

 

Steven J. O’Day, M.D.

 

01/02/2022(1)

 

 

 

 

 

150,000

 

 

 

3.22

 

 

 

313,500

 

 

02/02/2022(2)

 

 

52,042

 

 

 

 

 

 

 

 

 

130,625

 

Christine M. Klaskin

 

01/02/2022(1)

 

 

 

 

 

100,000

 

 

 

3.22

 

 

 

209,000

 

 

02/02/2022(2)

 

 

15,654

 

 

 

 

 

 

 

 

 

39,291

 

 

(1)
Options have a three-year vesting schedule where one-third of the options vest on the one-year anniversary of the grant date, with the remainder vesting in eight equal quarterly installments thereafter, generally subject to the named executive officer’s continued employment or service with the Company.
(2)
Represents the incremental fair value of the fully-vested shares granted in lieu of 2021 bonuses. See footnotes 4 and 5 to the Summary Compensation Table for further information on the shares granted in lieu of 2021 bonuses.
(3)
Represents the grant date fair value of awards granted during 2022 determined in accordance with ASC Topic 718, disregarding the effects of estimated forfeitures. See footnotes 5 and 6 to the Summary Compensation Table for the assumptions used in determining the grant date fair value of these awards.

 

27


 

Narrative Disclosure to the Summary Compensation Table and Grants of Plan-Based Awards Table

We entered into an employment agreement with Dr. Armen in 2005 and subsequently amended the agreement in 2009 and 2010. Dr. Armen’s employment agreement sets forth his initial base salary and target annual bonus opportunity, both of which have subsequently increased, and provides for severance payments and benefits in the event of a qualifying termination of his employment, as described under “Potential Payments Upon Termination or Change of Control” below. Dr. Armen’s employment agreement includes restrictive covenants with respect to confidential information and the assignment of intellectual property, and includes non-competition and employee non-solicitation/no-hire covenants that apply for the greater of 18 months following his termination of employment or the period during which Dr. Armen receives severance payments and benefits.

We entered into an employment agreement with Dr. O’Day in October 2020, which was effective upon the commencement of his employment with us in January 2021. Dr. O’Day’s employment agreement provides for an initial annual base salary which has subsequently increased, and a target annual bonus opportunity, and provides for severance payments and benefits in the event of a qualifying termination of his employment, as described under “Potential Payments Upon Termination or Change of Control” below. Dr. O’Day’s employment agreement also provided for a $630,000 sign-on bonus, which he received in 2021, and which he was required to repay to the Company if he terminated his employment within two years. Dr. O’Day’s employment agreement includes restrictive covenants with respect to confidential information and the assignment of intellectual property, and includes non-competition covenants that apply during employment and for 12 months following his termination of employment under certain circumstances, as well as employee non-solicitation/no-hire covenants that apply during employment and for the greater of 12 months following his termination of employment or the period during which Dr. O’Day receives severance payments and benefits.

We have not entered into an employment agreement with Ms. Klaskin. However, we have entered into a change of control agreement with Ms. Klaskin, the terms of which are described under “Potential Payments Upon Termination or Change of Control” below.

 

28


 

Outstanding Equity Awards at Fiscal Year-End 2022

The following table shows outstanding equity awards for the named executive officers as of December 31, 2022:

 

 

Option Awards

Name

 

Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable

 

 

Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable

 

 

 

Option
Exercise
Price
($)

 

 

Option
Expiration
Date

Garo H. Armen, Ph.D.

 

 

200,000

 

 

 

 

 

 

 

3.61

 

 

06/13/2023

 

 

140,000

 

 

 

 

 

 

 

2.72

 

 

09/12/2023

 

 

500,000

 

 

 

 

 

 

 

3.00

 

 

02/14/2024

 

 

250,000

 

 

 

 

 

 

 

5.04

 

 

02/12/2025

 

 

555,000

 

 

 

 

 

 

 

4.16

 

 

03/31/2026

 

 

53,037

 

 

 

 

 

 

 

6.77

 

 

09/16/2026

 

 

853,000

 

 

 

 

 

 

 

3.77

 

 

03/31/2027

 

 

935,200

 

 

 

 

 

 

 

5.65

 

 

03/02/2028

 

 

42,500

 

 

 

 

 

 

 

2.38

 

 

12/31/2028

 

 

1,665,000

 

 

 

 

 

 

 

2.38

 

 

01/01/2029

 

 

87,500

 

 

 

 

 

 

 

3.23

 

 

11/05/2029

 

 

1,500,000

 

 

 

 

 

 

 

4.12

 

 

12/24/2029

 

 

58,333

 

 

 

 

 

 

 

3.61

 

 

06/15/2030

 

 

1,263,500

 

 

 

636,500

 

(1)

 

 

3.70

 

 

12/17/2030

 

 

 

 

 

1,900,000

 

(2)

 

 

3.18

 

 

01/01/2031

 

 

 

 

 

1,900,000

 

(1 )

 

 

3.22

 

 

01/02/2032

Steven J. O’Day, M.D.

 

 

99,999

 

 

 

200,001

 

(3)

 

 

3.23

 

 

01/04/2031

 

 

 

 

 

150,000

 

(1 )

 

 

3.22

 

 

01/02/2032

Christine M. Klaskin

 

 

32,500

 

 

 

 

 

 

 

3.61

 

 

06/13/2023

 

 

30,000

 

 

 

 

 

 

 

2.72

 

 

09/12/2023

 

 

100,000

 

 

 

 

 

 

 

3.00

 

 

02/14/2024

 

 

45,000

 

 

 

 

 

 

 

5.04

 

 

02/12/2025

 

 

30,000

 

 

 

 

 

 

 

4.16

 

 

03/31/2026

 

 

7,551

 

 

 

 

 

 

 

6.77

 

 

09/16/2026

 

 

72,500

 

 

 

 

 

 

 

3.77

 

 

03/31/2027

 

 

83,150

 

 

 

 

 

 

 

5.65

 

 

03/02/2028

 

 

75,000

 

 

 

 

 

 

 

2.38

 

 

12/31/2028

 

 

 

8,333

 

 

 

 

 

 

 

2.38

 

 

12/31/2028

 

 

4,537

 

 

 

 

 

 

 

3.23

 

 

11/05/2029

 

 

85,000

 

 

 

 

 

 

 

4.12

 

 

12/24/2029

 

 

12,500

 

 

 

 

 

 

 

3.61

 

 

06/15/2030

 

 

33,248

 

 

 

16,752

 

(1)

 

 

3.70

 

 

12/17/2030

 

 

 

 

 

 

50,000

 

(2 )

 

 

3.18

 

 

01/01/2031

 

 

 

 

 

100,000

 

(1 )

 

 

3.22

 

 

01/02/2032

 

 

(1)
Represents options that are subject to a three-year vesting schedule pursuant to which one-third of the options vest on the one-year anniversary of the grant date (which is nine years prior to the option’s expiration date) and the remainder vest in equal quarterly installments thereafter, generally subject to the named executive officer’s continued employment or service with the Company.
(2)
Options were granted by our Compensation Committee on January 1, 2021 subject to stockholder approval of an increase to the available share pool under our equity incentive plan. Such approval was obtained on June 16, 2021. Options are subject to a four-year vesting schedule pursuant to which one-third of the options vested on the two-year anniversary of the grant date (which is eight years prior to the option’s expiration date) and the remainder vest in equal quarterly installments thereafter, generally subject to the named executive officer’s continued employment or service with the Company.
(3)
Options granted January 4, 2021 that have a three-year vesting schedule where one-third of the options vest on each anniversary of the grant date, generally subject to Dr. O’Day’s continued employment or service with the Company.

 

 

 

29


 

Option Exercises and Stock Vested for Fiscal Year 2022

The following table provides information relating to the vesting of stock awards for our named executive officers during 2022. No stock options were exercised by our named executive officers during 2022.

 

 

Stock awards

 

Name

 

Number of
shares
acquired on
vesting
(#)
(1)

 

 

Value
realized on
vesting
($)
(2)

 

Garo H. Armen, Ph.D.

 

 

373,505

 

 

 

937,498

 

Steven J. O’Day, M.D.

 

 

256,125

 

 

 

711,874

 

Christine M. Klaskin

 

 

46,961

 

 

 

117,872

 

 

(1)
For each of our named executive officers, includes fully vested shares granted in 2022 in lieu of cash payment for 2021 bonuses. See footnotes 4 and 5 to the Summary Compensation Table for further information on the shares granted in lieu of 2021 bonuses. For Dr. O'Day, also includes the shares of our common stock acquired upon the vesting of restricted stock units during 2022.
(2)
The value reported equals the Company’s stock price on the vesting date multiplied by the number of shares acquired on vesting.

Potential Payments Upon Termination or Change of Control

We have entered into employment agreements with Drs. Armen and O’Day that provide for certain payments and benefits in the event of certain terminations of employment or a change of control. Additionally, we are a party to a change-in-control agreement with Ms. Klaskin. The following text summarizes the potential payments to Drs. Armen and O’Day and Ms. Klaskin, and the following tables include estimates of those potential payments assuming that the triggering event occurred on December 31, 2022, the last day of our fiscal year. As used in the following summary, the terms “cause,” “good reason” and “change of control” have the meaning set forth in the applicable agreement.

Our Chief Executive Officer

Dr. Armen

Under Dr. Armen’s employment agreement, if we terminate Dr. Armen’s employment without cause or if he terminates his employment for good reason outside of a change of control, he is entitled to receive from the Company:

his base salary for a period of 18 months, plus a lump sum payment of 150% of the higher of his target annual incentive bonus for the year of termination or his last actual annual incentive bonus;
Company-paid coverage under our medical and dental plans for a period of 18 months following the date of termination;
a lump sum payment of $15,000 for outplacement assistance;
a gross-up for any taxes with respect to such outplacement assistance payment;
a gross-up payment for any taxes, interest and penalties imposed by Section 4999 of the Code; and
at the Compensation Committee’s discretion, the acceleration of vesting of any unvested stock options.

Upon a change of control, 100% of any of Dr. Armen’s outstanding unvested performance shares immediately vest and 50% of any of Dr. Armen’s outstanding unvested stock options and restricted stock as of the change of control date become vested and exercisable and, in the case of shares of restricted stock, no longer subject to forfeiture. If a change of control occurs and, within 24 months, we terminate Dr. Armen’