LITS 10-K/A
Lite Strategy, Inc. (LITS)
Table of Contents
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Amendment No. 1)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to .
Commission File Number:
(Exact name of registrant as specified in its charter)
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(Address of principal executive offices) (Zip Code)
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Securities registered pursuant to Section 12(b) of the Act:
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Securities registered pursuant to Section 12(g) of the Act:
None
(Title of Class)
Indicate by a check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
Indicate by a check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Large accelerated filer |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240,10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
The aggregate market value of the voting and non-voting common equity held by non-affiliates, based on the closing price per share of Registrant's Common Stock on the Nasdaq Capital Market was approximately $
As of September 15, 2023, there were
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EXPLANATORY NOTE
On September 26, 2023, MEI filed its Annual Report on Form 10-K for the fiscal year ended June 30, 2023 (the “Original Form 10-K”). Certain Part III information was omitted from the Original Form 10-K in reliance on General Instruction G(3) to Form 10-K. General Instruction G(3) to Form 10-K provides that registrants may incorporate by reference certain information from a definitive proxy statement which involves the election of directors if such definitive proxy statement is filed with the Securities and Exchange Commission (the “SEC”) within 120 days after the end of the fiscal year. We do not anticipate that MEI's definitive proxy statement involving the election of directors in connection with its MEI's fiscal year 2024 annual meeting of stockholders will be filed by October 27, 2023 (i.e., within 120 days after the end of the 2023 fiscal year). Accordingly, this Amendment No. 1 (this “Amendment”) hereby amends and restates Part III, Items 10 through 14, of the Original Form 10-K as set forth below. The information included herein as required by Part III, Items 10 through 14, of the Original Form 10-K is more limited than what is required to be included in the definitive proxy statement to be filed in connection with our 2024 annual meeting of stockholders. Accordingly, the definitive proxy statement to be filed at a later date will include additional information related to the topics herein and additional information not required by Part III, Items 10 through 14, of Form 10-K.
This Amendment also restates Item 15 of Part IV of the Original Form 10-K. In addition, as required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), new certifications by our principal executive officer and principal financial officer are filed as exhibits to this Amendment under Item 15 of Part IV hereof.
No other amendments are being made hereby to the Original Form 10-K. Except as stated herein, this Amendment does not reflect events occurring after the filing of the Original Form 10-K with the SEC on September 26, 2023, and no attempt has been made in this Amendment to modify or update other disclosures as presented in the Original Form 10-K. Terms used but not defined herein have the meanings given to them in the Original Form 10-K.
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MEI PHARMA, INC.
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Item 10: |
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Item 11: |
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Item 12: |
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
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Item 13: |
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Certain Relationships and Related Transactions, and Director Independence |
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PART IV |
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Item 15: |
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PART III
Item 10. Directors, Executive Officers and Corporate Governance
Directors
Set forth below are the names, ages as of October 1, 2023, and certain biographical information regarding our directors who are not being considered for re-election at the Annual Meeting.
Name |
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Age |
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Positions Held |
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Expiration of Term |
Charles V. Baltic III |
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62 |
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Director |
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Fiscal 2025 Annual Meeting of Stockholders |
Nicholas R. Glover, Ph.D. |
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54 |
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Director |
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Fiscal 2025 Annual Meeting of Stockholders |
Frederick W. Driscoll |
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72 |
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Director |
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Fiscal 2025 Annual Meeting of Stockholders |
David M. Urso |
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59 |
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President, CEO and Director |
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Fiscal 2025 Annual Meeting of Stockholders |
Thomas C. Reynolds, M.D., Ph.D. |
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64 |
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Director |
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Fiscal 2026 Annual Meeting of Stockholders |
Daniel P. Gold, Ph.D. |
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69 |
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Director |
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Fiscal 2024 Annual Meeting of Stockholders |
Tamar D. Howson |
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75 |
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Director |
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Fiscal 2024 Annual Meeting of Stockholders |
Sujay R. Kango |
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60 |
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Director |
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Fiscal 2024 Annual Meeting of Stockholders |
David M. Urso, age 59, J.D., President, Chief Executive Officer and Director
Mr. Urso served as Chief Operating Officer and General Counsel of MEI from July 2018 to June 2023 and as President and Chief Executive Officer since June 2023. Mr. Urso was appointed as a member of MEI’s board of directors effective June 8, 2023. Prior to July 2018, Mr. Urso had been MEI’s Senior Vice President of Corporate Development and General Counsel since April 2014. Mr. Urso joined MEI with more than two decades of experience in the life science industry, most recently as Chief Operating Officer and General Counsel at Tioga Pharmaceuticals, a privately held drug development company he co-founded in 2005 as a Principal at Forward Ventures, where he was responsible for identifying and developing life science venture capital investments. Prior to joining Forward Ventures in 2002, Mr. Urso was Director of Corporate Development and Legal Affairs at DNA Sciences, Inc. Previously, he worked as an attorney in the corporate securities and licensing groups at Wilson Sonsini Goodrich & Rosati LLP and Cooley Godward LLP, after beginning his career as a bench scientist at SmithKline Beecham and the University of Pennsylvania Medical School. Mr. Urso received a J.D. from Harvard Law School and a B.A. in Molecular Biology and Philosophy from Reed College.
Charles V. Baltic III, age 62, Chair
Mr. Baltic has served as a director of MEI Pharma since October 2011 and as Chair of the Board of directors of MEI since January 2023. He previously served as Chair of the Nominating and Governance Committee from 2012 to 2022. Mr. Baltic also serves as a director and Chairman of the Board of AssayQuant Technologies, Inc., a private company focused on kinase-based assay drug development technology licensed from the Massachusetts Institute of Technology. Mr. Baltic was previously affiliated with Needham & Company, LLC as Managing Director and Co-Head of Healthcare Banking from 2009 until 2019 and as Senior Advisor from 2019 to 2022. Mr. Baltic served as acting CEO of Amyndas Pharmaceuticals, a private development-stage biotechnology company focused on immunology and innate immunity complement therapeutics based on technology licensed from the University of Pennsylvania from March 2021 to October 2021. Mr. Baltic served as Executive Vice President and COO of SIDIS Corp. from 2019 to 2021, overseeing the sale of the Propel Labs flow cytometry business to Thermo Fisher Scientific in February 2021. Mr. Baltic was a Managing Director and head of the biotechnology practice at CRT Capital Group from 2006 to 2008. From 2001 to 2006, he served as a Managing Director in Healthcare Investment Banking at Wachovia Securities. Prior to Wachovia, he was with Healthcare Investment Banking at Cowen and Company for six years. Prior to beginning his investment banking career in 1996, Mr. Baltic practiced corporate and securities law with the firm Dewey Ballantine, representing numerous healthcare and securities clients. Mr. Baltic previously served as a director of SIDIS Corp. from 2015 to 2019. Mr. Baltic served as a director of the trade association Life Science Washington from 2013 to 2018. Mr. Baltic served as a director of MedVantage Inc., a private health informatics company acquired by IMS Health (now IQVIA Holdings) in 2011. Mr. Baltic served on the U.S. Securities and Exchange Commission’s Advisory Committee on Small and Emerging Growth Companies from 2013 to 2015. He served as a founding Trustee of Hope Funds for Cancer Research from 2007 to 2017. Mr. Baltic earned B.A. (honors) and J.D. degrees from Georgetown University and a M.B.A. degree in finance from the Wharton School of the University of Pennsylvania.
Nicholas R. Glover, Ph.D., age 54, Director
Dr. Glover has been a director of MEI Pharma since June 2013. He is currently a consultant to the biotech industry. Previously, he served as President and Chief Executive Officer of Sierra Oncology (NASDAQ: SRRA), a drug development company focused on advancing targeted therapeutics for the treatment of patients with cancer, from July 2014 through May 2020. Prior to joining Sierra, he served as President and Chief Executive Officer of YM Biosciences, an oncology drug development company, from November 2010 until its acquisition by Gilead Sciences in February 2013. Previously, Dr. Glover was President and Chief Executive Officer of Viventia Biotech, a biopharmaceutical
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company involved in the discovery and development of monoclonal antibody-based technologies for the treatment of cancer, which he joined after serving as an investment manager for MDS Capital, a life sciences venture capital firm. Dr. Glover holds a B.Sc. (Hons) in Chemistry from the University of East Anglia, U.K., a M.Sc. in Chemistry from the University of British Columbia, Canada, and a Ph.D. in Chemistry from Simon Fraser University, Canada.
Frederick W. Driscoll, age 72, Director
Mr. Driscoll has been a director of MEI Pharma since February 2018. He currently serves on the board of directors of Cue Biopharma, Cellectar Biosciences, Inc. and Calliditas Therapeutics. He served as interim chief financial officer at Invivyd, Inc. from September 2022 to May 2023. He served as chief financial officer of Renovacor from March to June 2022. He served as the chief financial officer of Flexion Therapeutics, Inc. from 2013 to 2017 and rejoined in June 2021 as chief financial officer. Prior to joining Flexion, he was the chief financial officer at Novavax, Inc. from 2009 to 2013. From 2008 to 2009, Mr. Driscoll served as the chief executive officer at Genelabs Technologies, Inc. and from 2007 to 2008 he served as the company's chief financial officer. He was also the chief executive officer of OXiGENE, Inc. from 2000 to 2006. Mr. Driscoll also served as the chairman of the board and audit committee chair at OXiGENE and as a member of the audit committee for Cynapsus Therapeutics, Inc. Mr. Driscoll earned a bachelor’s degree in Accounting and Finance from Bentley University.
Thomas C. Reynolds, M.D., Ph.D., age 64, Director
Dr. Reynolds has been a director of MEI Pharma since February 2013. He is President of Two Paddles Consulting LLC since December 2013, providing consulting services to biotechnology and pharmaceutical companies. Dr. Reynolds served as an independent director of Trillium Therapeutics Inc. (NASDAQ: TRIL; TSX: TR), an immuno-oncology company, until April 2021. Previously, he served as Chief Medical Officer of Seattle Genetics from March 2007 until his retirement in February 2013. While at Seattle Genetics, he was responsible for building and leading an integrated clinical development, regulatory and medical affairs organization, highlighted by the development and approval of ADCETRIS®. From 2002 to 2007, Dr. Reynolds served at ZymoGenetics (acquired by BMS in 2010), most recently as Vice President, Medical Affairs, where he oversaw the clinical development and regulatory filing of RECOTHROM®. Previously, he was Vice President, Clinical Affairs at Targeted Genetics, and before that was at Somatix Therapy (acquired by Cell Genesys in 1997). Dr. Reynolds received his M.D. and Ph.D. in Biophysics from Stanford University and a B.A. in Chemistry from Dartmouth College.
Daniel P. Gold, Ph.D., age 69, Director
Dr. Gold served as MEI’s President, Chief Executive Officer and a director from April 2010 until the consummation of the Merger. He joined MEI with approximately 25 years of drug discovery and development experience, most recently as President and Chief Executive Officer of Prospect Therapeutics, a mid-stage oncology company. Prior to his tenure at Prospect, Dr. Gold was founder and Chief Scientific Officer of Favrille, where he was an integral member of a team that advanced the company’s lead oncology candidate through a pivotal Phase 3 clinical trial. He currently serves on the Board of Trustees of the Hope Funds for Cancer Research. Dr. Gold’s academic qualifications include Postdoctoral Fellowships at the Dana-Farber Cancer Institute, at the Harvard School of Medicine and the Massachusetts Institute of Technology, Center for Cancer Research. He holds a Ph.D. in Pathology/Immunology from Tufts University, Boston and a bachelor’s degree in Biology from the University of California, Los Angeles.
Tamar D. Howson, age 75, Director
Ms. Howson has been a director of MEI Pharma since July 2019. She is a highly experienced business development executive and consultant with more than 30 years of service in the pharmaceutical and biotechnology industries. Ms. Howson currently serves on the board of directors of Immunic Pharma and Cue Pharma. Between 2009 to 2019 she served on the boards of various other life sciences companies including Actavis plc, Aradigm Corporation, ContraVir Pharmaceuticals, Inc., Cynapsus Therapeutics Inc., Enzymotec PLC, Idenix Pharmaceuticals Inc., Organovo Holdings Inc, OXiGENE, Inc., and Scientus Pharma, a private company. From 2009 to 2011, Ms. Howson served as a member of the transaction advisory firm JSB-Partners, providing business development support to life sciences companies. From 2007 to 2008, Ms. Howson served as Executive Vice President, Corporate Business Development at Lexicon Pharmaceuticals, a public biotech company. Prior to joining Lexicon, Ms. Howson served as Senior Vice President, Corporate and Business Development at Bristol-Myers Squibb and SmithKline Beecham plc. Ms. Howson holds an M.B.A. from Columbia University, a M.S. from City University of New York, and a B.S. in Chemical Engineering from the Technion, Israel.
Sujay R. Kango, age 60, Director
Mr. Kango has been a director of MEI Pharma since November 2021. Mr. Kango is an experienced executive with more than 25 years of experience in the pharmaceutical and biotechnology industries. Mr. Kango currently serves as the President and CEO of Tmunity Therapeutics and is a board member of Infinity Pharmaceuticals. He has held senior management positions where he has been instrumental in transforming earlier stage biotechnology companies into fully integrated global biotechnology organizations. Mr. Kango has built commercial infrastructures and teams, while leading multiple global product launches. Mr. Kango joined Acceleron Pharma in 2018, where he most recently served as the executive vice president and chief commercial officer and was responsible for establishing the company’s global presence, including its launch of Reblozyl in North America. Mr. Kango played a critical role in Acceleron’s $11.5 billion acquisition. In addition, Mr. Kango has led multiple global product launches across several therapeutic areas including oncology-hematology, rare diseases, immunology, and virology. Previously Mr. Kango was vice president of global commercial development for oncology at AbbVie, prior to which he served as the executive
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vice president and chief commercial officer at Infinity Pharmaceuticals. Mr. Kango also served as vice president, global marketing, and sales operations at Onyx Pharmaceuticals, an Amgen subsidiary. Prior to Onyx, he held several leadership positions including vice president sales and marketing-oncology at Merck & Co., global commercial leader- Procrit®/Eprex® at Ortho-Biotech, and various sales and marketing positions at Schering-Plough. Mr. Kango earned a B.S. in Microbiology and an M.B.A. from McNeese State University.
Information about the Board of Directors and its Committees
The Board of Directors has responsibility for the overall corporate governance of MEI Pharma. During the fiscal year ended June 30, 2023, a majority of the members of the Board of Directors were, and as of the date of this Proxy Statement are, independent within the meaning of the Nasdaq Stock Market (“Nasdaq”) rules.
The Board has established an Audit Committee to oversee MEI’s financial matters, a Compensation Committee to oversee our compensation policies, plans and programs and a Nominating and Governance Committee to assist the Board of Directors in nominating board members to be elected by the stockholders at the Annual Meeting, to fill vacancies and newly created directorships, and to evaluate and monitor all matters with respect to governance of MEI and oversee compliance by MEI with its legal and regulatory obligations.
Schedule of Committee Members (as of October 1, 2023)
Board Member
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Audit Committee
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Compensation Committee
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Nominating &
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Charles V. Baltic, III |
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Frederick W. Driscoll |
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Nicholas R. Glover |
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Tamar D. Howson |
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Sujay R. Kango |
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Thomas C. Reynolds |
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Daniel P. Gold |
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= Committee Member
= Committee Chair
= Financial Expert
Audit Committee
The Audit Committee of the Board of Directors has been established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Audit Committee’s responsibilities include:
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Mr. Driscoll has served as Chairman of the Audit Committee since August 29, 2019. The other members of the Audit Committee are Mr. Baltic, and Dr. Glover. Mr. Driscoll has been determined by the Board of Directors to be an “audit committee financial expert” as defined by the SEC.
The Board of Directors has determined that each of the Audit Committee members is independent, as defined by applicable Nasdaq and SEC rules. We have adopted an Audit Committee Charter, which is posted on its website at www.meipharma.com. The Audit Committee met five times during the fiscal year ended June 30, 2023.
Compensation Committee
The Compensation Committee acts on behalf of the Board to fulfill the Board’s responsibilities to:
The Compensation Committee also consults with and considers the recommendations of the chief executive officer with respect to the appropriate level and mix of the various compensation components, focused primarily on the particular goals of applicable executives and employees in a particular year. The Board of Directors has adopted a written charter for the Compensation Committee, which is available on our website at www.meipharma.com. Dr. Glover has served as the Chairman of the Compensation Committee since December 16, 2021. The other members of the Compensation Committee are Ms. Howson, Mr. Kango and Dr. Reynolds. The Board of Directors has determined that each member of the Compensation Committee is independent as defined by applicable Nasdaq rules. The Compensation Committee met three times during the fiscal year ended June 30, 2023.
Nominating and Governance Committee
The Nominating and Governance Committee is responsible for assisting the Board of Directors in:
Dr. Reynolds has served as Chairman of the Nominating and Governance Committee since January 2023. The other members of the Nominating and Governance Committee are Ms. Howson, Mr. Kango and Mr. Baltic. MEI Pharma’s Nominating and Governance Committee Charter is posted on its website at www.meipharma.com. The Board of Directors has determined that each of the Nominating and Governance Committee members is independent, as defined by applicable Nasdaq and SEC rules. The Nominating and Governance Committee met nine times during the fiscal year ended June 30, 2023.
Stockholders who would like to propose an independent director candidate for consideration for nomination by the Board of Directors at next year’s annual meeting of stockholders may do so by submitting the candidate’s name, resume and biographical information to the attention of Justin J. File, Secretary, MEI Pharma, Inc., 11455 El Camino Real, Suite 250, San Diego, California 92130. All stockholder nominations
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received by the Secretary, which comply with the advance notice provisions of MEI's Amended and Restated Bylaws, will be presented to the Nominating and Governance Committee for the same consideration as individuals identified by the Nominating and Governance Committee through other means.
While we has no minimum qualifications for director nominees, the Nominating and Governance Committee reviews the prospective candidate’s biographical information and assesses each candidate’s independence, diversity, skills and expertise based on a variety of factors, including the following criteria:
Application of these factors requires the exercise of judgment by members of the Nominating and Governance Committee when the Committee makes recommendations to the Board of Directors, and cannot be measured in a quantitative way. In addition, the Nominating and Governance Committee considers, as one factor among many, the diversity of Board candidates, which may include diversity of skills and experience as well as geographic, gender, age, and ethnic diversity. The Nominating and Governance Committee does not, however, have a formal policy with regard to the consideration of diversity in identifying Board candidates. The Nominating and Governance Committee and the Board of Directors generally value the broad business experience and independent business judgment in the health care, life sciences and other fields of each member. Specifically, Mr. Baltic is qualified for the Board based on his business experience in the health care investment banking industry. Mr. Driscoll is qualified for the Board based on his business experience in the pharmaceutical industry in the area of finance and his status as an “audit committee financial expert”. Dr. Glover is qualified for the Board based on his business experience and his drug development experience in the oncology field. Ms. Howson is qualified for the Board based on her business experience in the pharmaceutical industry in the area of business development. Mr. Kango is qualified for the Board based on his business and pharmaceutical industry experience in the areas of commercialization, strategic marketing, business development and drug development in oncology. Mr. Urso is qualified for the Board based on his experience in varying roles of leadership within the Company, including most recently as Chief Executive Officer and [·]. Dr. Reynolds is qualified for the Board based on his medical experience and experience in clinical development and regulatory and medical affairs. Dr. Gold is qualified for the Board based on his prior experience as the Company’s chief executive officer and other experience in clinical development and the pharmaceutical industry.
In addition, the Nominating and Governance Committee oversees compliance by MEI with its legal and regulatory obligations and periodically reviews our:
Director Independence
The Board of Directors has determined the independence of each director in accordance with the elements of independence set forth in the Nasdaq listing standards. Based upon information solicited from each director, the Board of Directors has determined that each of Mr. Baltic, Mr. Driscoll, Dr. Glover, Ms. Howson, Mr. Kango and Dr. Reynolds has no material relationship with MEI Pharma and is “independent” within the meaning of Nasdaq’s director independence standards as currently in effect. In making the foregoing determinations, the Board of Directors has considered both the objective tests set forth in the Nasdaq independence standards and subjective measures with respect to each director necessary to determine that no relationships exist that would interfere with the exercise of independent judgment by each such director in carrying out responsibilities of a director. Each of Dr. Gold, as former President and Chief Executive Officer, and Mr. Urso, as current President and Chief Executive Officer, are not considered independent in accordance with Nasdaq’s requirements.
Board Leadership Structure
Mr. Baltic has served as the Chair of our Board of Directors since January 2023. The Board of Directors does not have a policy addressing whether the same person should serve as both the Chief Executive Officer and Chair of the Board or if the roles should be separate. Our Board believes that it should have the flexibility to make its determination based upon what it considers to be the appropriate leadership
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structure for MEI at the time. The Board believes that its current leadership structure, with Mr. Urso serving as President and Chief Executive Officer and Mr. Baltic serving as Chair of the Board is appropriate for MEI at this time.
Board Role in Risk Oversight
Risk is an integral part of the Board and Committee deliberations throughout the year. While the Board has the ultimate oversight responsibility for the risk management process, various committees of the Board also have responsibility for risk management. In particular, the Audit Committee focuses on financial risk, including internal controls, and receives financial risk assessment reports from management. Risks related to the compensation programs are reviewed by the Compensation Committee. The Nominating and Governance Committee exercises oversight of governance risks, including succession planning and legal compliance. The Board is advised by these committees of significant risks and management’s response through periodic updates.
Board Diversity
The table below provides certain information with respect to the composition of our Board. Each of the categories listed in the table has the meaning ascribed to it in Nasdaq Listing Rule 5605(f).
Board Diversity Matrix (As of August 31, 2023) |
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Total Number of Directors |
8 |
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Female |
Male |
Non-Binary |
Did Not Disclose Gender |
Part I: Gender Identity |
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Directors |
1 |
7 |
— |
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Part II: Demographic Background |
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African American or Black |
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Alaskan Native or Native American |
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Asian |
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1 |
— |
— |
Hispanic or Latinx |
— |
— |
— |
— |
Native Hawaiian or Pacific Islander |
— |
— |
— |
— |
White |
1 |
6 |
— |
— |
Two or More Races or Ethnicities |
— |
— |
— |
— |
LGBTQ+ |
— |
— |
— |
— |
Did Not Disclose Demographic Background |
— |
— |
— |
— |
Board Diversity Matrix (As of August 31, 2022) |
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Total Number of Directors |
9 |
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Female |
Male |
Non-Binary |
Did Not Disclose Gender |
Part I: Gender Identity |
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Directors |
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6 |
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Part II: Demographic Background |
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African American or Black |
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Alaskan Native or Native American |
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Asian |
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Hispanic or Latinx |
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Native Hawaiian or Pacific Islander |
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White |
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5 |
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Two or More Races or Ethnicities |
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LGBTQ+ |
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Did Not Disclose Demographic Background |
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Anti-Hedging and Pledging Policies
Under our Insider Trading Policy, all directors, officers, employees and consultants of MEI are subject to restrictions on hedging of securities of MEI. These restrictions apply to securities of MEI owned by such persons, regardless of whether such securities were granted by us to such persons as compensatory awards. Our Insider Trading Policy prohibits such persons from engaging in short sales of securities of MEI or in transactions in publicly traded options with respect to our securities. In addition, our Insider Trading Policy permits, but discourages, such persons from holding our securities in a margin account or pledging securities of MEI as collateral for a loan and from entering standing orders with respect to our securities.
Stockholder Communications with the Board of Directors
Our stockholders may communicate with the Board of Directors, including non-executive directors or officers, by sending written communications addressed to such person or persons in care of MEI Pharma, Inc., Attention: Secretary, 11455 El Camino Real, Suite 250, San Diego, California, 92130. All communications will be compiled by the Secretary and submitted to the addressee. If the Board of Directors modifies this process, the revised process will be posted on our website.
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Appointment of Directors
Our amended and restated certificate of incorporation and amended and restated by-laws provide that the number of directors will be set by resolution of the board, but shall be between two and nine. We currently have eight directors.
Under our amended and restated certificate of incorporation and amended and restated by-laws, directors are to be elected at each annual meeting of stockholders for a term of three years unless the director is removed, retires or the office is vacated earlier. The board is divided into three classes with respect to the term of office, with the terms of office of one class expiring each successive year. This classified board provision could discourage a third party from making a tender offer for MEI's shares or attempting to obtain control of MEI Pharma. It could also delay stockholders who do not agree with the policies of the Board of Directors from removing a majority of the Board of Directors for two years.
A director may resign at any time. The resignation is effective upon receipt of notice. Any or all directors may be removed with cause by a resolution of stockholders entitled to vote to elect directors. Vacancies from resignation or removal or expansion of the size of the board may be filled by resolution of a majority of directors then in office or by a sole remaining director, and any director so appointed shall serve for the remainder of the full term of the class of directors in which the vacancy occurred.
Attendance of Directors at Board Meetings and Stockholder Meetings
During the fiscal year ended June 30, 2023, the Board of Directors held a total of seventeen meetings, and each director attended at least 75% of the total number of meetings of the Board of Directors and of the meetings of each committee of the Board of Directors on which such director served.
All directors are expected to attend our annual meetings of stockholders. All directors then in office attended the annual meeting of stockholders held in December 2022.
Code of Ethics
We have adopted a Code of Business Conduct and Ethics that applies to our directors and employees and we have posted the text of the policy on our website at www.meipharma.com.
Executive Officers
Our executive officers are appointed by and serve at the discretion of the Board of Directors. Set forth below are the names and certain biographical information regarding MEI Pharma’s executive officers as of October 1, 2023.
David M. Urso, age 59, President and Chief Executive Officer
See “Directors” above for biographical information regarding Mr. Urso.
Justin J. File, age 53, Chief Financial Officer and Secretary
Mr. File has 30 years of experience in accounting and finance, working in both public and private companies. He has a diverse range of experience, having worked in various industries, including the life sciences industry for the past 16 years. From 2015 to 2023, Mr. File was the Chief Financial Officer and Corporate Secretary of Evofem Biosciences, Inc., a women's health company that developed and commercialized Phexxi®, a nonhormonal contraceptive for women. While at Evofem he helped bring the company public through a reverse merger and was responsible for overseeing corporate finance and accounting, information technology and investor relations. Previously, Mr. File provided executive financial and accounting oversight consulting services to biotechnology companies, and before that led accounting operations and reporting at Sequenom, Inc., a molecular diagnostic company. He additionally served as Treasurer of Sequenom’s diagnostic subsidiary. Before joining industry, Mr. File worked for approximately ten years in public accounting, primarily with Arthur Andersen LLP. Mr. File graduated from Central Washington University with a Bachelor of Science in Accounting and Business Administration. He is a Certified Public Accountant (inactive).
Richard G. Ghalie, M.D., age 66, Chief Medical Officer
Dr. Ghalie has been Chief Medical Officer since April 2021. Prior to April 2021, Dr. Ghalie had been MEI’s Senior Vice President, clinical development since March 2016. He is a hematologist and oncologist with more than 25 years of drug development experience at public and private companies. Dr. Ghalie has held several executive positions in the pharmaceutical industry and has led medical teams that successfully filed NDAs and MAAs resulting in the approval of four new indications. Dr. Ghalie holds a medical degree from the French School of Medicine in Lebanon, a master’s degree from the University Paris XI and an MBA from the University of Washington in Seattle. He has authored or co-authored more than 125 manuscripts, book chapters and scientific publications.
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Item 11. Executive Compensation
COMPENSATION DISCUSSION AND ANALYSIS
This Compensation Discussion and Analysis describes the compensation strategy, policies, programs and practices for the named executive officers identified in the Summary Compensation Table. For fiscal year 2023, the named executive officers consist of Daniel P. Gold, Ph.D., President, Chief Executive Officer and Director, Brian G. Drazba, Chief Financial Officer, David M. Urso, Chief Operating Officer and General Counsel, and Richard G. Ghalie, M.D., Chief Medical Officer, to whom we collectively refer in this Compensation Discussion and Analysis as our “named executive officers.”
Fiscal year 2023 was a year of transition and change for us. In December 2022 we announced plans to realign our clinical development efforts after jointly deciding with our development partner, Kyowa Kirin Co., Ltd. ("KKC"), to discontinue development of our lead drug candidate, zandelisib, outside of Japan. We consequently focused our development efforts on our two early-stage clinical assets, voruciclib and ME-344. The discontinuation of the partnership with KKC resulted in a reduction to our workforce by 51% during fiscal year 2023 in a staggered program that affected 28 employees in December 2022 and an additional 26 employees through June 2023. In February 2023, we entered into an agreement and plan of merger with Infinity Pharmaceuticals, subject to approval by our stockholders, which subsequently was not approved by our stockholders in July 2023. In May 2023 and in accordance with our previously announced transition plan, our board of directors appointed David M. Urso to be President and Chief Executive Officer of MEI and terminated the employment of Daniel Gold, Ph.D., our Chief Executive Officer since 2010, in each case effective as of June 2, 2023. Also, in accordance with our previously announced transition plan, we terminated the employment of our fiscal year 2023 Chief Financial Officer, Brian Drazba, in August 2023 and announced the appointment of Justin J. File, as his successor.
Compensation Philosophy and Objectives
We believe that the performance of our executive officers significantly impacts our ability to achieve our corporate goals. We, therefore, place considerable importance on the design and administration of our executive officer compensation program. This program is intended to enhance stockholder value by attracting, motivating and retaining qualified individuals to perform at the highest levels and to contribute to our growth and success. Our executive officer compensation program is designed to provide compensation opportunities that are tied to individual and corporate performance.
Our overall compensation philosophy has been to pay our executive officers an annual base salary and to provide opportunities, through cash and equity incentives, to deliver higher compensation if certain key performance goals are satisfied or exceeded. The primary principles of our fiscal year 2023 compensation strategy were:
The Compensation Committee’s Process
The Compensation Committee acts on behalf of the Board with respect to fulfilling the Board’s responsibilities to oversee our compensation policies, plans and programs and reviewing and determining, as appropriate, the compensation to be paid to executive officers and directors. To achieve this task, the Compensation Committee (i) reviews and approves corporate performance goals and objectives that support and reinforce our long-term strategic goals and compensation plans; (ii) reviews the individual performance of the executive officers; (iii) establishes policies with respect to equity compensation arrangements, timing and pricing of equity awards for newly hired employees, promotions and annual grants for executive and non-executive employees and directors; (iv) reviews regional and industry-wide compensation practices and trends to assess the propriety, adequacy and competitiveness of our executive compensation programs among comparable companies in our industry; (v) reviews and approves the terms of any employment agreements, severance agreements, change-of-control protections and any other compensation arrangements of the executive officers; (vi) performs and considers a compensation risk assessment; and (vii) considers stockholder feedback and Say-on-Pay voting results.
With respect to compensation of our Chief Executive Officer, the Compensation Committee evaluates the Chief Executive Officer’s performance in light of relevant performance goals and objectives, taking into account the policies of the Compensation Committee and, with respect to long-term incentive compensation, stockholder return and the results of the most recent stockholder advisory vote on executive compensation. The Compensation Committee reviews and approves (or if appropriate, recommends to the Board for final determination and approval) individual and corporate performance goals and objectives of our other executive officers. The Compensation Committee considers the recommendations of the Chief Executive Officer with respect to the compensation of our other executive officers. The Compensation Committee also makes recommendations to the Board with respect to this “Compensation Discussion and Analysis” section and recommends that such section be included in any of our annual reports on Form 10-K, registration statements, Proxy statements or information statements.
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The Compensation Committee meets at least once a year or more frequently as its members deem necessary or appropriate. Under its charter, the Compensation Committee has the authority, in its sole discretion, to retain or obtain the advice of a compensation consultant, legal counsel or other advisors as the Compensation Committee may determine to assist in the performance of the Compensation Committee’s duties and responsibilities, only after taking into consideration the factors prescribed by the SEC and Nasdaq that bear upon the adviser’s independence.
Setting Executive Compensation
The Compensation Committee considers peer group analysis as a component of its overall executive compensation decision process, but it does not attempt to set executive compensation to a specific benchmark level, or percentile as compared to executive compensation levels at other companies. The Compensation Committee determines the mix of compensation of each executive officer based on its review of such competitive data and an assessment of the individual’s performance. We believe our approach to compensation does not encourage excessive risk-taking by our executives as it is not a market outlier and is based on a typical mix of short- and long-term compensation tied to both internal objectives and to stockholder value.
Our peer group of companies for fiscal year 2023 consisted of 22 similar publicly-traded drug development companies, all approved by the Compensation Committee, with input from management and F. W. Cook, our compensation consultant. The peer group is composed of drug development companies with a similar market cap, (median peer market cap at the time the peer data were reviewed by the Committee in June 2022 was $157 million), generally without material revenue from commercial products, and with emphasis on oncology drug development companies, as follows:
Adaptimmune Therapeutics |
G1 Therapeutics |
Aeglea BioTherapeutics |
Geron Corporation |
Agenus, Inc. |
IDEAYA Biosciences |
AnaptysBio, Inc. |
Karyopharm Therapeutics |
AVEO Pharmaceuticals |
Molecular Templates, Inc. |
Calithera Biosciences |
Pieris Pharmaceuticals |
CEL-SCI Corporation |
Rigel Pharmaceuticals |
Clovis Oncology, Inc. |
Syndax Pharmaceuticals |
CTI Biopharmaceuticals |
Syros Pharmaceuticals |
CytomX Therapeutics |
UroGen Pharma Ltd. |
Epizyme Pharmaceuticals |
Verastem, Inc. |
The Compensation Committee believes that our base compensation, cash incentives and equity programs reward the achievement of defined corporate goals and objectives. This is critical for ensuring a competitive program that retains our existing executive officers and allows us to hire new executive officers, particularly considering the competitive nature of our industry.
The peer data were used as context for setting fiscal 2023 executive officer compensation. The Compensation Committee does not set a target benchmark, but in fiscal year 2023 the value of total direct compensation was below the median for the CEO and for all other named executive officers, and Mr. Urso’s total compensation value in fiscal year 2023 as our new CEO was approximately 17% lower than our prior CEO, Dr. Gold’s, compensation value in fiscal year 2022. Further, the fiscal year 2023 option value for Mr. Urso includes both his regular annual fiscal year 2023 award as COO and General Counsel in July 2022 and a second grant to recognize his promotion to CEO in June 2023, which was also intended to be his annual CEO equity award in fiscal year 2024.
Role of Stockholder Say-on-Pay Votes
At our annual meeting of stockholders held in January 2023, approximately 80% of the shares voted at the meeting approved, on an advisory basis, the compensation of our named executive officers. The Compensation Committee considers input from stockholders, its compensation consultant and proxy advisors, when assessing its compensation philosophy and the components of its compensation program, giving further consideration to the level of attainment of corporate goals and to the compensation data of our peer group so that compensation decisions are broadly consistent with market practice.
Elements of Compensation
Each executive officer’s compensation has three key elements: (i) base salary, (ii) performance-based cash incentives and (iii) equity-based compensation. These elements of executive compensation are intended to align the interests of our executive officers with those of our stockholders.
Base Salary
Base salaries serve to provide a fixed amount of compensation to our executive officers for successfully fulfilling their responsibilities. We establish base salaries for our executive officers when they join us or upon promotion. Base salaries for executive officers are reviewed and
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determined by the Compensation Committee annually during the first fiscal quarter, following consultation with our compensation consultant. The Compensation Committee determined to increase officer salaries by 3.5% at the start of fiscal year 2023, reflecting an increase below the expected industry average. Accordingly, Mr. Urso was provided a salary increase of 3.5% in July 2022, while he was COO and General Counsel, with a subsequent increase of 15% upon his promotion to CEO in June 2023. Dr. Ghalie, Dr. Gold, and Mr. Drazba were also provided a salary increase of 3.5%, respectively, at the start of fiscal year 2023.
Performance-based Cash Incentives
The Compensation Committee believes that allocating a meaningful amount of our executive officers’ total cash compensation to the achievement of corporate goals and objectives aligns their interests with those of our stockholders. The Compensation Committee establishes annual corporate incentive bonus targets for each of our executive officers, expressed as a percent of base salary. Fiscal year 2023 bonus targets as a percent of base salary were set at the start of the fiscal year at 60% for Dr. Gold, 45% for Mr. Urso, and 40% for Mr. Ghalie and Mr. Drazba. The corporate goals and objectives are generally critical path activities or strategic initiatives designed to enhance stockholder return.
The Compensation Committee determined that the fiscal year 2023 goals should be broken into a first half (1H) group and a second half (2H) group in recognition of the year’s uncertainty, though bonuses were not paid until after the entire year was complete. The goals were as objective as possible in both their definition and their scoring at the end of the period, though scoring goals included a subjective element to recognize the quality of achievements.
The following is a description of the primary corporate goals for fiscal year 2023, which guided the Compensation Committee in determining total compensation.
1H –
2H –
The Compensation Committee determined we had met 77.5% of target based on weighted achievement of the goals above. The named executive officers were paid 77.5% of their target bonus for the corporate achievement without any individual adjustment.
Equity-based Compensation
The Compensation Committee believes that long-term value creation is achieved through an ownership culture that encourages performance by our executive officers through stock and stock-based awards. This potential reward for stockholder value creation is also key to our retention strategy. Under our Amended and Restated MEI Pharma, Inc. 2008 Omnibus Equity Compensation Plan (the “2008 Equity Plan”), we may award incentive and non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, and performance shares and units. Stock options expire after 10 years, have an exercise price equal to the fair market value at grant, typically vest 25% after one year and in equal monthly installments thereafter over the next 36 months and have a three-month post-termination exercise period. All equity awards to NEOs in fiscal year 2023 were stock options because they are naturally performance-based without any value delivery unless the stock price increases after grant.
The regular annual equity grant cycle occurs at the start of the fiscal year and at the start of fiscal year 2023, we granted annual options to Dr. Gold, then Chief Executive Officer, Mr. Urso, then Chief Operating Officer and General Counsel, Mr. Drazba, then Chief Financial Officer, and the Chief Medical Officer, Dr. Ghalie, to purchase 74,800, 52,500, 17,500, and 28,000 shares of our common stock, respectively. These option awards amounts had grant date fair value that was below the median of the peer companies. Grant amounts were different based on MEI's assessment of the relative importance of each executive to the future, the need to retain them, and market data for their position. All of the option awards granted at the start of fiscal year 2023 were granted with an exercise price of $10.80, which was the closing sales price on the date of grant. Mr. Urso was provided a second option award to purchase 166,571 shares of our common stock upon becoming CEO in June 2023, with an exercise price equal to the $7.50 closing price on the grant date. The combined grant date fair value of his CEO option award in the final month of fiscal year combined with his annual option award as COO and General Counsel in the first month of the fiscal year remains below the median for a CEO in the peer group. All options granted before and during 2023 are currently underwater as of September 15, 2023 and do not provide any value at our current share price.
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Executive Benefits and Perquisites
We offer benefit programs to our employees, including named executive officers, which include paid time off, health insurance, a company funded HSA account and a company sponsored 401(k) plan. Our executive officers generally do not receive any supplemental retirement benefits or perquisites and participate in the above listed benefit programs on the same basis as other full-time employees.
Severance and Change in Control Agreements
Each of Mr. Urso’s, Mr. Drazba’s, and Dr. Ghalie’s employment agreements provides for certain severance payments upon the applicable employee’s termination by us, other than for cause or by the applicable employee for good reason, as such terms are defined in the respective employment agreement. Upon such a termination of employment, we will: (i) make a payment to the applicable employee in lieu of notice in an amount equal to twelve months of such employee’s base salary (as in effect at the time of such employee’s termination from employment), and (ii) accelerate the vesting of the applicable employee’s options so that such employee will be vested in the same number of shares of common stock subject to the options as if such employee had continued to be employed by us for an additional twelve months. Such payment and additional option vesting will be conditional upon the execution of a customary release of claims in favor of us and our affiliates, in a form prescribed by us. The payment in lieu of notice will be paid to the applicable employee in a single lump sum payment as soon as administratively practicable after the maximum review and revocation period for the release agreement as may be required under applicable law, if any, or such earlier date as determined in our sole discretion, but in no event more than 60 days after the applicable employee’s termination of employment. If their employment had been terminated in accordance with the foregoing provisions on June 30, 2022, Mr. Urso, Mr. Drazba, and Dr. Ghalie would have been entitled to payments for 12 months salary in the amount of $614,000, $428,635, and $479,205, respectively, and payments for fiscal year 2023 bonus funded at 77.5% target of $237,925, 132,887, and $148,554, respectively. Each would be entitled to 12 months of option vesting as follows: Mr. Urso 69,194 shares, Mr. Drazba 9,989 shares, and Dr. Ghalie, 13,969 shares. The intrinsic values of the option vesting acceleration on June 30, 2023, would have been nil for all three NEOs because all options were underwater.
Dr. Gold’s employment as CEO was terminated by us without cause on June 2, 2023, when Mr. Urso became CEO. Dr. Gold’s severance was paid pursuant to his employment agreement dated April 23, 2010, with 12 months base salary and accelerated vesting of the portion of his stock options that would have vested over the next 12 months, plus his fiscal year 2023 bonus based on performance and board discretion. Further, a total of 58,053 options accelerated, reflecting the number of shares Dr. Gold that would have vested in during the next 12 months. Dr. Gold’s vested options may be exercised after separation of Board service for three years, not to exceed their original term.
In the event of a change in control of MEI Pharma, as defined in the 2008 Equity Plan, unless the Compensation Committee of the Board of Directors determines otherwise, all of the options granted to Mr. Urso, Dr. Ghalie will accelerate and become fully exercisable effective upon the date of the change in control. For each Mr. Urso, Mr. Drazba, Dr. Ghalie and former President and CEO Dr. Gold there was no intrinsic value of unvested stock options, as of June 30, 2023, which would accelerate and become fully exercisable upon a change in control.
Tax and Accounting Considerations
The tax and accounting consequences to us of certain compensation elements are important considerations for the Compensation Committee when evaluating and recommending compensation packages for our executive officers. Generally, the Compensation Committee seeks to balance its objective to create an effective compensation program that attracts, retains and rewards executives in order to maximize the return to stockholders with the need for appropriate tax and accounting consequences of such compensation.
In addition to considering the tax consequences, the Compensation Committee considers the accounting consequences of its decisions, including the impact of expenses being recognized in connection with equity-based awards, in determining the size and form of different equity-based awards.
CEO Pay Ratio
SEC rules require us to disclose the total annual compensation of our principal executive officer for fiscal 2023, who was David Urso, our President and Chief Executive Officer, the median of the total annual compensation of all employees other than our principal executive officer, as well as their ratio to each other (the “CEO Pay Ratio”). Total annual compensation for our principal executive officer and for the median of the total annual compensation of all employees is calculated in accordance with SEC rules applicable to the Summary Compensation Table. For fiscal 2023, these amounts were as follows:
In determining the median compensated employee, we chose June 30, 2023 as the determination date. As of this date, we had 46 employees, excluding our principal executive officer. We annualized compensation of employees who were not employed with us for the full
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fiscal year. In determining our median compensated employee and calculating the CEO Pay Ratio, we did not use any of the exemptions permitted under SEC rules, nor did we rely upon any material assumptions, adjustments or estimates.
We believe that the CEO Pay Ratio set forth above is a reasonable estimate for fiscal 2023, determined in a manner consistent with SEC rules. The SEC rules for identifying the median compensated employee and calculating the CEO Pay Ratio based on that employee’s total annual compensation permit companies to adopt a variety of methodologies, to apply certain exemptions and to make certain assumptions, adjustments or estimates that reflect their compensation policies. Accordingly, the CEO Pay Ratio may not be comparable to the pay ratios reported by other companies, which may have used different methodologies, assumptions, adjustments or estimates in calculating their pay ratios.
COMPENSATION COMMITTEE REPORT
Our Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K and contained within this Proxy Statement with management. Based on such review and discussions, our Compensation Committee recommended to our Board that the Compensation Discussion and Analysis be included in this Proxy Statement and submitted on October 1, 2023, by the members of the Compensation Committee of the Board of Directors:
Dr. Nicholas R. Glover
Ms. Tamar D. Howson
Dr. Thomas C. Reynolds
Mr. Sujay R. Kango
This Section is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference in any filing of our under the Exchange Act or the Securities Act, other than in our Annual Report on Form 10-K where it shall be deemed to be furnished, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
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EXECUTIVE COMPENSATION
Our Executive Officers
Our named executive officers for the year ended June 30, 2023, were:
Summary Compensation Table
The table below sets forth for the fiscal years ended June 30, 2023, 2022 and 2021, the compensation of our named executive officers.
Name and Principal Position |
|
Year |
|
Salary ($) |
|
|
Stock Awards ($)(1) |
|
|
Option Awards ($) (2) |
|
|
Non-Equity Incentive Plan Compensation ($) (3)(4)(5)(6) |
|
|
All Other Compensation ($) |
|
|
Total ($) (7) |
|
||||||
David M. Urso (8) |
|
2023 |
|
$ |
541,185 |
|
|
$ |
— |
|
|
$ |
1,352,600 |
|
|
$ |
207,273 |
|
|
$ |
— |
|
|
$ |
2,101,058 |
|
President and Chief Executive Officer |
|
2022 |
|
$ |
516,810 |
|
|
$ |
— |
|
|
$ |
1,078,500 |
|
|
$ |
148,842 |
|
|
$ |
— |
|
|
$ |
1,744,152 |
|
|
|
2021 |
|
$ |
492,200 |
|
|
$ |
174,500 |
|
|
$ |
1,265,250 |
|
|
$ |
188,267 |
|
|
$ |
— |
|
|
$ |
2,120,217 |
|
Richard G. Ghalie. M.D. |
|
2023 |
|
$ |
479,205 |
|
|
$ |
— |
|
|
$ |
218,900 |
|
|
$ |
148,554 |
|
|
$ |
— |
|
|
$ |
846,659 |
|
Chief Medical Officer |
|
2022 |
|
$ |
463,000 |
|
|
$ |
— |
|
|
$ |
575,200 |
|
|
$ |
118,528 |
|
|
$ |
— |
|
|
$ |
1,156,728 |
|
|
|
2021 |
|
$ |
432,481 |
|
|
$ |
69,800 |
|
|
$ |
522,750 |
|
|
$ |
118,065 |
|
|
$ |
— |
|
|
$ |
1,143,096 |
|
Daniel P. Gold, Ph.D. (9) |
|
2023 |
|
$ |
685,603 |
|
|
$ |
— |
|
|
$ |
584,700 |
|
|
$ |
344,894 |
|
|
$ |
831,443 |
|
|
$ |
2,446,640 |
|
Former President and Chief |
|
2022 |
|
$ |
716,625 |
|
|
$ |
— |
|
|
$ |
1,536,800 |
|
|
$ |
275,184 |
|
|
$ |
— |
|
|
$ |
2,528,609 |
|
Executive Officer and Director |
|
2021 |
|
$ |
682,500 |
|
|
$ |
279,200 |
|
|
$ |
1,638,800 |
|
|
$ |
348,075 |
|
|
$ |
— |
|
|
$ |
2,948,575 |
|
Brian G. Drazba (10) |
|
2023 |
|
$ |
428,635 |
|
|
$ |
— |
|
|
$ |
136,800 |
|
|
$ |
132,877 |
|
|
$ |
— |
|
|
$ |
698,312 |
|
Former Chief Financial Officer |
|
2022 |
|
$ |
414,140 |
|
|
$ |
— |
|
|
$ |
359,500 |
|
|
$ |
106,020 |
|
|
$ |
— |
|
|
$ |
879,660 |
|
|
|
2021 |
|
$ |
406,020 |
|
|
$ |
— |
|
|
$ |
554,300 |
|
|
$ |
138,047 |
|
|
$ |
— |
|
|
$ |
1,098,367 |
|
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Employment Agreements
We have entered into written employment agreements with each of the named executive officers, which set forth the terms of their respective employments.
Employment Agreement between David M. Urso and MEI Pharma
On May 31, 2023, the MEI board of directors appointed Mr. Urso as President and Chief Executive Officer of MEI, effective as of June 2, 2023. Mr. Urso was also elected as a member of the MEI board of directors, effective as of June 8, 2023. Mr. Urso will serve as a member of the class of directors whose term expires at the 2025 annual meeting of MEI’s stockholders and until his successor is duly elected and qualified or until his earlier resignation or removal. At this time, Mr. Urso is not expected to serve on any committees of the board of directors.
In connection with Mr. Urso’s appointment as President and Chief Executive Officer, Mr. Urso and MEI entered into a new employment agreement (the “CEO Employment Agreement”), effective as of June 2, 2023, that replaces the existing employment agreement dated March 6, 2014, between MEI and Mr. Urso, as amended by Amendment No. 1, dated July 12, 2018. The CEO Employment Agreement provides for an annual base salary of $614,000, with a target annual bonus opportunity of 50% of base salary. Mr. Urso will be eligible to participate in MEI’s health, retirement, expense reimbursement and other benefit plans.
The CEO Employment Agreement provides for a grant as of June 2, 2023 of an option to purchase a number of shares of MEI’s common stock, under MEI’s equity compensation plan, equal to 2.5% of MEI’s outstanding shares as of the date of grant, with vesting over a 4-year period, full vesting on a change in control, and other terms and conditions consistent with the CEO Employment Agreement and grants made to other senior executives (the “CEO Initial Grant”). The exercise price of the CEO Initial Grant will be equal to the Nasdaq closing price per share of MEI stock on the date of grant. The CEO Employment Agreement further provides for a stock option grant to be made on the closing date of the Merger, contingent on the consummation of the Merger and subject to Mr. Urso’s being employed by or providing service to MEI or an affiliate at the time of grant (i.e., the closing date of the Merger), that is equal to 2.5% of the outstanding shares of MEI on the closing date of the Merger (calculated immediately after the effective time of the Merger), less the number of MEI shares underlying the CEO Initial Grant; provided, however, that the total number of shares covered by options granted to Mr. Urso in a calendar year shall not exceed 200,000 shares pursuant to the terms of the MEI’s equity compensation plan (the “CEO Second Grant”). The exercise price of the CEO Second Grant will be equal to the Nasdaq closing price per share of MEI stock on the date of grant (the closing date of the Merger). The CEO Second Grant will have the same vesting terms as the CEO Initial Grant.
If the full number of options called for pursuant to the CEO Second Grant cannot be granted on the closing date of the Merger in 2023 because of the per person share limit under the equity compensation plan, then an option for the number of shares that could not be granted on the closing date will be granted on January 2, 2024 (the “Top Off Grant”); provided that, if on January 2, 2024, MEI’s equity compensation plan does not have sufficient shares available to make the Top Off Grant, such grant will be made on the first subsequent date on which MEI does have sufficient shares under the equity compensation plan. To receive the Top Off Grant, Mr. Urso must be employed by or providing services to MEI or an affiliate on the applicable date of grant. The exercise price of the Top Off Grant will be equal to the Nasdaq closing price per share of MEI stock on the date of grant of the Top Off Grant, and the Top Off Grant will have the same vesting terms as the CEO Initial Grant. If the Merger is not consummated, then in certain circumstances a CEO Second Grant (and a Top Off Grant, if applicable) will be made to Mr. Urso according to the terms and conditions of the CEO Employment Agreement. On May 31, 2023, the MEI board of directors approved the CEO Initial Grant, the CEO Second Grant, and the Top Off Grant, as applicable, to be effective on their respective dates of grant.
For 2024 and subsequent years, Mr. Urso will be eligible to receive equity awards on similar terms as other senior executives of MEI. MEI will pay Mr. Urso’s legal fees in connection with negotiation of the CEO Employment Agreement and ancillary agreements, up to $7,500.
Under the CEO Employment Agreement, if Mr. Urso’s employment is terminated by MEI without cause or Mr. Urso resigns for good reason, Mr. Urso will be eligible to receive the following severance benefits if he signs an effective release of claims: (i) lump sum payment equal to 12 months of his base salary, (ii) if he elects COBRA health care continuation coverage, MEI will pay the monthly COBRA premium for 12 months, (iii) payment of a pro-rata annual bonus, if any, for the year of termination, and (iv) accelerated vesting of a portion of Mr. Urso’s outstanding stock options equal to the number of options that would have vested if he had continued to be employed by MEI for 12 months following termination. The CEO Employment Agreement also provides that if, within 3 months before a change in control, MEI
14
Table of Contents
terminates Mr. Urso’s employment without cause at the request of the other party to the change in control transaction, or if, upon or within 2 years following a change in control, Mr. Urso’s employment is terminated by MEI without cause or Mr. Urso resigns for good reason, Mr. Urso’s outstanding stock options will fully vest and become exercisable as of his termination date, provided that he signs an effective release.
In the event that Mr. Urso’s employment is terminated due to his death or disability, vesting of a portion of Mr. Urso’s outstanding stock options will accelerate equal to the number of options that would have vested if he had continued to be employed by MEI for 12 months following termination, subject to his execution of an effective release in the event of disability.
Mr. Urso will continue to remain subject to his Employee Proprietary Information and Inventions Agreement, dated April 7, 2014.
Employment Agreement between Richard G. Ghalie and MEI Pharma
In connection with Dr. Ghalie’s appointment as Chief Medical Officer, effective May 3, 2021, we entered into an amendment to his Employment Letter, dated February 17, 2016 (as amended, the “Ghalie Employment Letter”). The Ghalie Employment Letter provides for an annual base salary of $463,000, and a stock option award to purchase 75,000 shares of our common stock. Effective July 1, 2021, pursuant to the terms of the Ghalie Employment Letter, Dr. Ghalie is eligible to earn an annual cash bonus in an amount up to a maximum of 40% of the base salary based on his achievement of milestones established by the Compensation Committee of the Board of Directors.
Dr. Ghalie may terminate his employment at any time other than for Good Reason (as defined in the Ghalie Employment Letter), upon providing one (1) month advance notice to us. Dr. Ghalie may terminate his employment with Good Reason by providing us with notice within sixty (60) days of the event giving rise to the Good Reason (and we do not cure the Good Reason event within thirty (30) days after receiving notice). We have the right to terminate the Ghalie Employment Letter with or without Cause (as defined in the Ghalie Employment Letter) at any time. If Dr. Ghalie’s employment is terminated by us without Cause or by Dr. Ghalie for Good Reason, Dr. Ghalie will be entitled to (i) a lump sum payment in an amount equal to twelve (12) months of his base salary and (ii) accelerated vesting of his options such that Dr. Ghalie will be vested in the same number of options as if he had continued to be employed by us for an additional twelve (12) months, subject to his execution and nonrevocation of a release of claims. The Ghalie Employment Letter contains confidentiality provisions.
Employment Agreement between Daniel P. Gold and MEI Pharma
In May 2023, our board of directors appointed David M. Urso to be President and Chief Executive Officer of MEI, effective as of June 2, 2023, and terminated the employment of Daniel Gold, Ph.D., the current Chief Executive Officer, effective as of June 2, 2023.
Our board of directors determined that Dr. Gold’s termination of employment is a termination without cause under the terms of Dr. Gold’s employment agreement, dated April 23, 2010, between MEI and Dr. Gold (the “Gold Employment Agreement”). Dr. Gold will receive severance pay equal to 12 months of base salary and accelerated vesting of the portion of his stock options that would have vested over the next 12 months, pursuant to the terms of the Gold Employment Agreement applicable to a termination without cause, as well as an annual bonus for the fiscal year ending June 30, 2023 based on performance and board discretion and a three-year period to exercise Dr. Gold’s vested stock options following the date on which he ceases to serve as a member of our board of directors (but no later than the expiration of the term of the option). Dr. Gold continues to be bound by restrictive covenants under his Employee Proprietary Information and Inventions Agreement, and he continues to be a member of our board of directors.
Employment Agreement between Brian G. Drazba and MEI Pharma
In connection with Mr. Drazba’s appointment as Chief Financial Officer, we entered into an Employment Letter, dated February 1, 2017, with Mr. Drazba (the “Drazba Employment Letter”). The Drazba Employment Letter provided for an annual base salary of $350,000, which has been increased periodically by the Compensation Committee. Pursuant to the terms of the Drazba Employment Letter, Mr. Drazba is eligible to earn an annual cash bonus, beginning for the fiscal year starting on July 1, 2017, in an amount up to a maximum of 40% of the base salary, based on his achievement of milestones established by the Compensation Committee of the Board of Directors.
Mr. Drazba may terminate his employment at any time other than for Good Reason (as defined in the Drazba Employment Letter), upon providing two (2) months advance notice to us. Mr. Drazba may terminate his employment with Good Reason by providing us with notice within sixty (60) days of the event giving rise to the Good Reason (and we do not cure the Good Reason event within thirty (30) days after receiving notice). We have the right to terminate the Drazba Employment Letter with or without Cause (as defined in the Drazba Employment Letter) at any time. If Mr. Drazba’s employment is terminated by us without Cause or by Mr. Drazba for Good Reason, Mr. Drazba will be entitled to (i) a lump sum payment in an amount equal to twelve (12) months of his base salary and (ii) accelerated vesting of his options such that Mr. Drazba will be vested in the same number of options as if he had continued to be employed by us for an additional twelve (12) months, subject to his execution and nonrevocation of a release of claims. The Drazba Employment Letter contains confidentiality provisions.
On June 20, 2023, Mr. Drazba and MEI signed a Separation and Release Agreement, where Mr. Drazba's employment with MEI will terminate at either the closing date of the Merger or no later than September 1, 2023. In consideration of the Separation and Release Agreement, Mr. Drazba is entitled to receive a payment of $428,635, payment of monthly COBRA premium for 12 months, payment of a
15
Table of Contents
pro-rata annual bonus, if any, for the year of termination, and accelerated vesting of a portion of Mr. Drazba’s outstanding stock options equal to the number of options that would have vested if he had continued to be employed by MEI for 12 months following termination. Mr. Drazba terminated employment with MEI on August 1, 2023.
Grants of Plan-Based Awards For Fiscal Year Ended June 30, 2023
|
|
|
|
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards (1) |
|
All Other Stock Awards Number of Shares of Stocks of Units |
|
All Other Option Awards Number of Securities Underlying Options |
|
|
Exercise or Base Price of Option Awards |
|
|
Grant Date Fair Value of Stock and Option Awards |
|
|||||||
Name |
|
Grant Date |
|
Target |
|
|
Maximum |
|
|
|
|
|
|
|
|
|
|
|
||||
David M. Urso |
|
July 5, 2022 |
|
$ |
267,449 |
|
|
N/A |
|
— |
|
|
52,500 |
|
|
$ |
10.80 |
|
|
$ |
410,400 |
|
David M. Urso |
|
June 2, 2023 |
|
N/A |
|
|
N/A |
|
— |
|
|
166,571 |
|
|
$ |
7.50 |
|
|
$ |
942,200 |
|
|
Richard G. Ghalie, M.D. |
|
July 5, 2022 |
|
$ |
191,682 |
|
|
N/A |
|
— |
|
|
28,000 |
|
|
$ |
10.80 |
|
|
$ |
218,900 |
|
Daniel P. Gold, Ph.D. |
|
July 5, 2022 |
|
$ |
445,024 |
|
|
N/A |
|
— |
|
|
74,800 |
|
|
$ |
10.80 |
|
|
$ |
584,700 |
|
Brian G. Drazba |
|
July 5, 2022 |
|
$ |
171,454 |
|
|
N/A |
|
— |
|
|
17,500 |
|
|
$ |
10.80 |
|
|
$ |
136,800 |
|
(1) The Board established single bonus targets and, as disclosed in the Summary Compensation Table, determined to pay out bonuses at 77.5% of the target levels.
16
Table of Contents
Outstanding Equity Awards at Fiscal Year-End
The following table provides information on all stock options and RSUs held by our named executive officers on June 30, 2023:
|
|
Option Awards |
|
Stock Awards |
|
|||||||||||||||||
|
|
Number of Securities Underlying Unexercised Options (Exercisable) |
|
|
Number of Securities Underlying Unexercised Options (Unexercisable) |
|
|
|
|
Options Exercise Price |
|
|
Option Expiration |
|
Number of Shares or Units of Stock That Have Not Vested |
|
Market Value of Shares or Units of Stock That Have Not Vested |
|
||||
Name |
|
(#) |
|
|
(#) |
|
|
Footnote |
|
($/Share) |
|
|
Date |
|
(#) |
|
($) |
|
||||
David M. Urso |
|
— |
|
|
|
166,571 |
|
|
(1) |
|
$ |
7.50 |
|
|
6/2/2033 |
|
— |
|
$ |
— |
|
|
|
|
— |
|
|
|
52,500 |
|
|
(2) |
|
$ |
10.80 |
|
|
7/5/2032 |
|
— |
|
$ |
— |
|
|
|
|
|
14,375 |
|
|
|
15,625 |
|
|
(3) |
|
$ |
59.00 |
|
|
7/1/2031 |
|
— |
|
$ |
— |
|
|
|
|
19,142 |
|
|
|
7,108 |
|
|
(4) |
|
$ |
69.80 |
|
|
7/2/2030 |
|
— |
|
$ |
— |
|
|
|
|
17,136 |
|
|
|
364 |
|
|
(5) |
|
$ |
50.40 |
|
|
7/1/2029 |
|
— |
|
$ |
— |
|
|
|
|
11,000 |
|
|
— |
|
|
(6) |
|
$ |
85.60 |
|
|
7/12/2028 |
|
— |
|
$ |
— |
|
|
|
|
|
6,500 |
|
|
— |
|
|
(7) |
|
$ |
86.60 |
|
|
6/22/2028 |
|
— |
|
$ |
— |
|
|
|
|
|
6,500 |
|
|
— |
|
|
(8) |
|
$ |
56.60 |
|
|
7/6/2027 |
|
— |
|
$ |
— |
|
|
|
|
|
6,500 |
|
|
— |
|
|
(9) |
|
$ |
27.20 |
|
|
7/28/2026 |
|
— |
|
$ |
— |
|
|
|
|
|
6,375 |
|
|
— |
|
|
(11) |
|
$ |
31.40 |
|
|
7/27/2025 |
|
— |
|
$ |
— |
|
|
Richard G. Ghalie, M.D. |
|
— |
|
|
|
28,000 |
|
|
(2) |
|
$ |
10.80 |
|
|
7/5/2032 |
|
— |
|
$ |
— |
|
|
|
|
|
7,675 |
|
|
|
8,325 |
|
|
(3) |
|
$ |
59.00 |
|
|
7/1/2031 |
|
— |
|
$ |
— |
|
|
|
|
1,956 |
|
|
|
1,794 |
|
|
(14) |
|
$ |
71.00 |
|
|
5/3/2031 |
|
— |
|
$ |
— |
|
|
|
|
5,472 |
|
|
|
2,028 |
|
|
(4) |
|
$ |
69.80 |
|
|
7/2/2030 |
|
— |
|
$ |
— |
|
|
|
|
7,344 |
|
|
|
156 |
|
|
(5) |
|
$ |
50.40 |
|
|
7/1/2029 |
|
— |
|
$ |
— |
|
|
|
|
6,500 |
|
|
— |
|
|
(6) |
|
$ |
85.60 |
|
|
7/12/2028 |
|
— |
|
$ |
— |
|
|
|
|
|
3,250 |
|
|
— |
|
|
(15) |
|
$ |
57.60 |
|
|
7/7/2027 |
|
— |
|
$ |
— |
|
|
|
|
|
1,250 |
|
|
— |
|
|
(13) |
|
$ |
27.60 |
|
|
7/13/2026 |
|
— |
|
$ |
— |
|
|
|
|
|
6,500 |
|
|
— |
|
|
(12) |
|
$ |
24.20 |
|
|
3/6/2026 |
|
— |
|
$ |
— |
|
|
Daniel P. Gold, Ph.D. |
|
|
35,850 |
|
|
— |
|
|
(16) |
|
$ |
10.80 |
|
|
7/5/2032 |
|
— |
|
$ |
— |
|
|
|
|
|
31,177 |
|
|
— |
|
|
(16) |
|
$ |
59.00 |
|
|
7/1/2031 |
|
— |
|
$ |
— |
|
|
|
|
|
33,292 |
|
|
— |
|
|
(16) |
|
$ |
69.80 |
|
|
7/2/2030 |
|
— |
|
$ |
— |
|
|
|
|
|
33,750 |
|
|
— |
|
|
(16) |
|
$ |
50.40 |
|
|
7/1/2029 |
|
— |
|
$ |
— |
|
|
|
|
|
15,000 |
|
|
— |
|
|
(16) |
|
$ |
85.60 |
|
|
7/12/2028 |
|
— |
|
$ |
— |
|
|
|
|
|
19,000 |
|
|
— |
|
|
(16) |
|
$ |
86.60 |
|
|
6/22/2028 |
|
— |
|
$ |
— |
|
|
|
|
|
19,000 |
|
|
— |
|
|
(16) |
|
$ |
56.60 |
|
|
7/6/2027 |
|
— |
|
$ |
— |
|
|
|
|
|
19,000 |
|
|
— |
|
|
(16) |
|
$ |
27.20 |
|
|
7/28/2026 |
|
— |
|
$ |
— |
|
|
|
|
|
13,775 |
|
|
— |
|
|
(16) |
|
$ |
31.80 |
|
|
7/28/2025 |
|
— |
|
$ |
— |
|
|
Brian G. Drazba |
|
— |
|
|
|
17,500 |
|
|
(2), (17) |
|
$ |
10.80 |
|
|
7/5/2032 |
|
— |
|
$ |
— |
|
|
|
|
|
4,800 |
|
|
|
5,200 |
|
|
(3), (17) |
|
$ |
59.00 |
|
|
7/1/2031 |
|
— |
|
$ |
— |
|
|
|
|
8,391 |
|
|
|
3,109 |
|
|
(4), (17) |
|
$ |
69.80 |
|
|
7/2/2030 |
|
— |
|
$ |
— |
|
|
|
|
11,261 |
|
|
|
239 |
|
|
(5), (17) |
|
$ |
50.40 |
|
|
7/1/2029 |
|
— |
|
$ |
— |
|
|
|
|
5,000 |
|
|
— |
|
|
(6), (17) |
|
$ |
85.60 |
|
|
7/12/2028 |
|
— |
|
$ |
— |
|
|
|
|
|
6,500 |
|
|
— |
|
|
(7), (17) |
|
$ |
86.60 |
|
|
6/22/2028 |
|
— |
|
$ |
— |
|
|
|
|
|
2,500 |
|
|
— |
|
|
(8), (17) |
|
$ |
56.60 |
|
|
7/6/2027 |
|
— |
|
$ |
— |
|
|
|
|
|
7,500 |
|
|
— |
|
|
(10), (17) |
|
$ |
31.80 |
|
|
4/3/2027 |
|
— |
|
$ |
— |
|
|
17
Table of Contents
Option Exercises and Stock Vested
Mr. Urso, Dr. Ghalie, Dr. Gold and Mr. Drazba did not exercise any stock options during the fiscal year ended June 30, 2023. 1,000 RSUs vested for Dr. Ghalie during the fiscal year ended June 30, 2023.
Pay Versus Performance
Provided below is our “pay versus performance” disclosure as required pursuant to Item 402(v) of Regulation S-K promulgated under the Exchange Act. As required by Item 402(v), we have included:
Given our current pay program, the only difference between the SCT and CAP amounts for our NEOs is the value of equity awards, which for purposes of the SCT is based on the grant date fair value of equity awards granted during the year, and for purposes of CAP is based on the year over year change in the fair value of equity awards that are unvested as of the end of the year, or that vested, or were forfeited during the year.
Note: pursuant to Item 402(v)(8), MEI, as a smaller reporting company ("SRC"), has provided the information required by 402(v) for three years, instead of five years and is not required to provide the disclosure required by 402(v)(2)(iv) or 402(v)(5) with respect to the total shareholder return of any peer group, or our-Selected Measure disclosure required by 402 (v)(2)(vi), or the Tabular List provided pursuant to 402(v)(6).
This disclosure has been prepared in accordance with Item 402(v) and does not necessarily reflect value actually realized by the NEOs. Please refer to our Compensation Discussion and Analysis, above, for a discussion of our executive compensation program objectives and the ways in which we align executive compensation with performance.
Our Most Important Metrics Used for Linking Pay and Performance. As required by Item 402(v), below are the most important metrics linking CAP to performance for fiscal year 2023. Besides stock price, the only financial performance measure the Committee used to link executive compensation to performance in 2023 was Total Cash.
Compensation decisions are made each year taking into account a number of other factors. Target pay levels are primarily set based on clinical milestones, individual performance, scope of responsibility, and an annual assessment of pay competitiveness within the market, but
18
Table of Contents
aside from Total Cash and stock price, no additional financial performance measures were used by us to link compensation actually paid to our NEOs in fiscal year 2023 to our performance.
Pay Versus Performance Table. In accordance with Item 402(v) and under rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, we are providing the tabular disclosure for our Chief Executive Officer (our Principal Executive Officer or “PEO”) and the average of our NEOs other than the PEO for fiscal years 2021, 2022 and 2023.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Value of Initial Fixed $100 Investment Based on Total Shareholder Return |
|
|
|
|
|
|
|
||||||||||||
Year |
|
Summary Compensation Table for Total Current PEO |
|
|
Compensation Actually Paid to Current PEO |
|
|
Summary Compensation Table for Total Former PEO |
|
|
Compensation Actually Paid to Former PEO |
|
|
Average Summary Compensation Table Total for Non-PEO |
|
|
Average Compensation Actually Paid to Non-PEO |
|
|
MEI Total Shareholder Return |
|
Peer Total Shareholder |
|
|
MEI Net Income |
|
|
Company Selected Measure: Total Cash ($Millions)(5) |
|
||||||||||
(a) |
|
(b) |
|
|
(c) |
|
|
(b) |
|
|
(c) |
|
|
(d) |
|
|
(e) |
|
|
(f) |
|
|
|
|
(h) |
|
|
(i) |
|
||||||||||
2023 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||||||
2022 |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||||
2021 |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||||
Fiscal Year |
|
PEO |
|
Non-PEO NEOs |
2023 |
|
David M. Urso (Current) |
|
Brian G. Drazba and Richard G. Ghalie, M.D. |
2022 |
|
Daniel P. Gold, Ph.D. |
|
Brian G. Drazba, Richard G. Ghalie, M.D. and David M. Urso |
2021 |
|
Daniel P. Gold, Ph.D. |
|
Brian G. Drazba, Richard G. Ghalie, M.D., Robert D. Mass (former Chief Medical Officer; retired on May 3, 2021) and David M. Urso |
19
Table of Contents
|
Current PEO (Urso)(i) |
|
|||||||
Fiscal Year |
2021 |
|
2022 |
|
2023 |
|
|||
SCT Total |
$ |
|
$ |
|
$ |
|
|||
Stock and Option Award Values Reported in SCT for the Covered Year |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Outstanding Unvested Stock and Option Awards Granted in the Covered Year |
|
|
|
|
|
|
|||
Change in Fair Value of Outstanding Unvested Stock and Option Awards from Prior Years |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Stock and Option Awards Granted in Covered Year that Vested |
|
— |
|
|
— |
|
|
— |
|
Change in Fair Value of Stock and Option Awards from Prior Years that Vested in Covered Year |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Stock and Option Awards Forfeited during the Covered Year |
|
— |
|
|
— |
|
|
— |
|
Compensation Actually Paid |
$ |
|
$ |
|
$ |
|
|||
|
|
|
|
|
|
|
|||
|
Former PEO (Gold)(i) |
|
|||||||
Fiscal Year |
2021 |
|
2022 |
|
2023 |
|
|||
SCT Total |
$ |
|
$ |
|
$ |
|
|||
Stock and Option Award Values Reported in SCT for the Covered Year |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Outstanding Unvested Stock and Option Awards Granted in the Covered Year |
|
|
|
|
|
— |
|
||
Change in Fair Value of Outstanding Unvested Stock and Option Awards from Prior Years |
|
( |
) |
|
( |
) |
|
— |
|
Fair Value of Stock and Option Awards Granted in Covered Year that Vested |
|
— |
|
|
— |
|
|
|
|
Change in Fair Value of Stock and Option Awards from Prior Years that Vested in Covered Year |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Stock and Option Awards Forfeited during the Covered Year |
|
— |
|
|
— |
|
|
( |
) |
Compensation Actually Paid |
$ |
|
$ |
|
$ |
|
|||
|
|
|
|
|
|
|
|||
|
Average Non-PEO (Gold)(i) |
|
|||||||
Fiscal Year |
2021 |
|
2022 |
|
2023 |
|
|||
SCT Total |
$ |
|
$ |
|
$ |
|
|||
Stock and Option Award Values Reported in SCT for the Covered Year |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Outstanding Unvested Stock and Option Awards Granted in the Covered Year |
|
|
|
|
|
|
|||
Change in Fair Value of Outstanding Unvested Stock and Option Awards from Prior Years |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Stock and Option Awards Granted in Covered Year that Vested |
|
— |
|
|
— |
|
|
— |
|
Change in Fair Value of Stock and Option Awards from Prior Years that Vested in Covered Year |
|
( |
) |
|
( |
) |
|
( |
) |
Fair Value of Stock and Option Awards Forfeited during the Covered Year |
|
( |
) |
|
— |
|
|
— |
|
Compensation Actually Paid |
$ |
|
$ |
|
$ |
|
|||
|
|
|
|
|
|
|
|||
(i) The fair value of options awards used to calculate CAP was determined using the Black-Scholes option pricing model, in accordance with FASB 718 |
|
||||||||
Relationship between CAP and TSR. The chart below reflects the relationship between the PEO and average non-PEO NEO CAP versus our TSR and the Peer Group TSR.
20
Table of Contents
Relationship between CAP and GAAP Net Loss. The chart below reflects the relationship between the PEO and average non-PEO NEO CAP and our GAAP Net Loss.
Relationship between CAP and Total Cash (our Selected Measure). The chart below reflects the relationship between the PEO CAP and average non-PEO NEO CAP and our Total Cash.
21
Table of Contents
Compensation of Directors
The following table provides details of the fees paid to our non-executive directors who served on the Board for the fiscal year ended June 30, 2023:
|
|
Fees Earned or Paid in Cash ($) (1) |
|
|
Option Awards ($) (2) |
|
|
Total ($) |
|
|||
Name |
|
|
|
|
|
|
|
|
|
|||
Christine A. White, M.D. (3) |
|
$ |
42,800 |
|
|
$ |
33,600 |
|
|
$ |
76,400 |
|
Charles V. Baltic III (4) |
|
|
85,600 |
|
|
|
33,600 |
|
|
|
119,200 |
|
Cheryl L. Cohen (5) |
|
|
32,800 |
|
|
|
33,600 |
|
|
|
66,400 |
|
Frederick W. Driscoll (6) |
|
|
65,600 |
|
|
|
33,600 |
|
|
|
99,200 |
|
Tamar D. Howson (7) |
|
|
63,797 |
|
|
|
33,600 |
|
|
|
97,397 |
|
Nicholas R. Glover, Ph.D. (8) |
|
|
77,600 |
|
|
|
33,600 |
|
|
|
111,200 |
|
Sujay R. Kango (9) |
|
|
63,475 |
|
|
|
33,600 |
|
|
|
97,075 |
|
Thomas C. Reynolds, M.D., Ph.D. (10) |
|
|
64,100 |
|
|
|
33,600 |
|
|
|
97,700 |
|
Daniel P. Gold, Ph.D. (11) |
|
|
3,673 |
|
|
|
— |
|
|
|
3,673 |
|
(1) For the fiscal year ended June 30, 2023, each of our non-executive directors received an annual cash retainer of $45,600. In addition to the annual cash retainer, the Chair received additional annual compensation of $35,000, and each Board Committee chair received additional compensation as follows: Audit Committee: $20,000; Compensation Committee: $15,000; Nominating and Governance Committee: $10,000; and Strategic Committee: $10,000. Committee members not receiving compensation as a committee chairperson received additional compensation as follows: Audit Committee: $10,000; Compensation Committee: $7,500; Nominating and Governance Committee: $5,000; and Strategic Committee: $7,000. Such amounts are pro-rated for periods of service less than the full fiscal year.
Indemnification Agreements
We have entered into an indemnification agreement with each of our directors and executive officers. Subject to certain exceptions, the indemnification agreements provide that an indemnitee will be indemnified for all expenses incurred or paid by the indemnitee in connection with a proceeding to which the indemnitee was or is a party, or is threatened to be made a party, by reason of the indemnitee’s status with or service to us or to another entity at our request. In connection with proceedings other than those by or in the right of our company and to which the indemnitee was or is a party, or is threatened to be made a party, by reason of the indemnitee’s status with or service to us or to another entity at our request, the indemnification agreements provide that an indemnitee will also be indemnified for all liabilities incurred or paid by the indemnitee. The indemnification agreements also provide for advancement of expenses incurred by an indemnitee in connection with an indemnifiable claim, subject to reimbursement in certain circumstances.
22
Table of Contents
The rights of each indemnitee are in addition to any other rights provided for under our amended and restated certificate of incorporation, and our amended and restated by-laws, as may be amended from time to time, and under Delaware law.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth information with respect to the beneficial ownership of shares of our common stock as of October 1, 2023 (except as otherwise indicated below) by (i) each person known to beneficially own more than 5% of our common stock, (ii) each of our named executive officers and directors, and (iii) our officers and directors as a group. Beneficial ownership is determined in accordance with the rules and regulations of the SEC. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock subject to options, warrants or restricted stock units, exercisable or convertible on or within sixty (60) days of October 1, 2023, are deemed outstanding. Such shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person. The percentage of beneficial ownership described below is based on 6,662,857 shares of common stock outstanding, plus adjustments to the number of shares of common stock outstanding as described above, as of October 1, 2023.
Name and Address of Beneficial Owner |
|
Amount & Nature of Beneficial Ownership |
|
|
Percentage of Shares Beneficially Owned |
|
|
||
Anson Fund Mgmt LP (1) |
|
|
914,188 |
|
|
|
13.7 |
|
% |
Cable Car Capital LLC (2) |
|
|
490,840 |
|
|
|
7.4 |
|
% |
The Vanguard Group, Inc. (3) |
|
|
383,551 |
|
|
|
5.8 |
|
% |
Tang Capital Management, LLC (4) |
|
|
361,084 |
|
|
|
5.4 |
|
% |
Daniel P. Gold, Ph.D. (5) |
|
|
244,043 |
|
|
|
3.5 |
|
% |
David M. Urso (6) |
|
|
133,714 |
|
|
|
1.7 |
|
% |
Brian G. Drazba (7) |
|
|
63,203 |
|
|
* |
|
|
|
Richard G. Ghalie, M.D. (8) |
|
|
53,723 |
|
|
* |
|
|
|
Charles V. Baltic III (9) |
|
|
27,263 |
|
|
* |
|
|
|
Frederick W. Driscoll (10) |
|
|
20,249 |
|
|
* |
|
|
|
Thomas C. Reynolds, M.D., Ph.D. (11) |
|
|
22,208 |
|
|
* |
|
|
|
Nicholas R. Glover, Ph.D. (12) |
|
|
21,708 |
|
|
* |
|
|
|
Tamar D. Howson (13) |
|
|
15,708 |
|
|
* |
|
|
|
Sujay R. Kango (14) |
|
|
10,214 |
|
|
* |
|
|
|
All Current Directors and Executive Officers as a Group (10 People) |
|
|
592,033 |
|
|
|
8.2 |
|
% |
* Represents beneficial ownership of less than 1%
23
Table of Contents
Item 13. Certain Relationships and Related Transactions, and Director Independence
There were no related party transactions required to be disclosed pursuant to Item 404 of the Regulation S-K during the three years ended June 30, 2023.
Item 14. Principal Accountant Fees and Services.
The Audit Committee has selected BDO USA, P.C. (“BDO USA”) as independent registered public accounting firm to audit the financial statements of MEI for the fiscal year ending June 30, 2024. The Board of Directors is submitting the appointment of BDO USA to the stockholders for ratification as a matter of good corporate practice.
BDO USA has been engaged as our independent auditor since January 18, 2011. They have performed our annual audit of our financial statements for each fiscal year beginning with the fiscal year ended June 30, 2011.
Representatives of BDO USA are expected to attend the Annual Meeting. The BDO USA representatives will have an opportunity to make a statement at the meeting and are expected to be available to respond to appropriate questions.
Fees Paid to Independent Registered Public Accounting Firm
The following table represents aggregate fees for services provided to us in the fiscal years ended June 30, 2023 and 2022. by BDO USA, our current independent registered public accounting firm:
|
|
Fiscal Year Ended June 30, |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
Audit Fees (1) |
|
$ |
806,100 |
|
|
$ |
469,400 |
|
Audit-Related Fees (2) |
|
|
— |
|
|
|
— |
|
Tax Fees (3) |
|
|
76,580 |
|
|
|
24,400 |
|
All Other Fees |
|
|
— |
|
|
|
— |
|
Total Fees |
|
$ |
882,680 |
|
|
$ |
493,800 |
|
Pre-Approval Policies and Procedures
The Audit Committee has adopted a policy and procedure for pre-approving all audit and non-audit services to be performed by our independent auditors. The policy requires pre-approval of all services rendered by our independent auditors either as part of the Audit Committee’s approval of the scope of the engagement of the independent auditors or on a case-by-case basis.
24
Table of Contents
PART IV
Item 15. Exhibits, Financial Statement Schedules
The consolidated financial statements required to be filed in the Amendment are included in Part II. Item 8 in the Original 10-K
2. Financial Statement Schedules
The Financial Statement Schedules have been omitted either because they are not required or because the information has been included in the consolidated financial statements or the notes thereto included in this Annual Report on Form 10-K.
3. Exhibits
The following Exhibits are filed as part of this Amendment as required by Regulation S-K. The Exhibits designated by an asterisk (^) are management contracts and compensation plans and arrangements required to be filed as Exhibits to this Report. Certain exhibits have been previously filed with the SEC pursuant to the Securities Exchange Act of 1934 (Commission File Number 0-28191).
Exhibit Index
|
|
|
2.1 |
|
|
|
|
|
3.1 |
|
|
|
|
|
3.2 |
|
|
|
|
|
3.5 |
|
|
|
|
|
3.6 |
|
|
|
|
|
3.7 |
|
|
|
|
|
4.1 |
|
|
|
|
|
4.2 |
|
|
|
|
|
4.3 |
|
|
|
|
|
4.4 |
|
|
|
|
|
10.1^ |
|
|
|
|
|
10.2^ |
|
|
|
|
|
10.3^ |
|
|
|
|
|
10.4^ |
|
|
|
|
|
10.5^ |
|
|
|
|
|
10.6^ |
|
|
|
|
|
25
Table of Contents
10.7 |
|
|
10.8** |
|
|
|
|
|
10.9 |
|
|
|
|
|
10.10 |
|
|
|
|
|
10.11** |
|
|
|
|
|
10.12*** |
|
|
|
|
|
10.13 |
|
|
|
|
|
10.14 |
|
|
|
|
|
10.15 |
|
|
|
|
|
10.16 |
|
|
|
|
|
10.17 |
|
|
|
|
|
10.18 |
|
|
|
|
|
10.19 |
|
|
|
|
|
10.20 |
|
|
|
|
|
10.21 |
|
|
|
|
|
10.22 |
|
|
|
|
|
23.1 |
|
|
|
|
|
31.1* |
|
|
|
|
|
31.2* |
|
|
|
|
|
32.1* |
|
|
|
|
|
101.INS |
|
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document* |
|
|
|
101.SCH |
|
Inline XBRL Taxonomy Extension Schema Document* |
|
|
|
101.CAL |
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document* |
|
|
|
101.DEF |
|
Inline XBRL Taxonomy Extension Definition Linkbase Document* |
26
Table of Contents
|
|
|
101.LAB |
|
Inline XBRL Taxonomy Extension Label Linkbase Document* |
|
|
|
101.PRE |
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document * |
104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document)* |
(*) |
Filed herewith. |
(**) |
Portions of this exhibit have been redacted pursuant to a confidential treatment request filed with the Securities and Exchange Commission. |
(***) |
Portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. |
27
Table of Contents
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized, on October 27, 2023.
|
|
|
MEI PHARMA, INC. |
||
|
||
|
|
|
By: |
|
/s/ David M. Urso |
|
|
David M. Urso |
|
|
Chief Executive Officer |
28