DEF 14A of CVRx, Inc.
Filed Apr 23, 2024 · FY20230001140361-24-021347
PROPOSAL NO. 1: ELECTION OF DIRECTORS
PROPOSAL NO. 1: ELECTION OF DIRECTORS The Board is presently comprised of six members. Accordingly, the Board has set the number of directors that will constitute the Board as of the Annual Meeting at six. The Board is divided into three classes, designated as Class I, Class II and Class III. One class of directors is elected by the stockholders at each annual meeting. Each director elected at an annual meeting serves from the time of his or her election until the third annual meeting of stockholders following that election and until his or her successor is duly elected and qualified. Class III directors, with a term expiring at the Annual Meeting, consist of Messrs. Mudit Jain and Kirk Nielsen and Ms. Shadan. The Nominating and Corporate Governance Committee has recommended, and the Board has approved, the nomination of three Class III directors, Messrs. Jain and Nielsen and Ms. Shadan, for re-election for three-year terms expiring at the 2027 annual meeting of stockholders and until their respective successors are duly elected and qualified, or, if sooner, until the director’s death, resignation or removal. Each of these nominees is currently a director of the Company. Ms. Shadan is standing for election by stockholders for the first time at the Annual Meeting. Ms. Shadan was identified as a potential candidate for the Board by several non-employee directors and our Chief Executive Officer in a process overseen by the Nominating and Corporate Governance Committee to identify director candidates with relevant leadership experience to join the Board following our initial public offering. Proxies cannot be voted for a greater number of persons than the number of nominees named in this Proxy Statement. If any nominee should become unavailable to serve for any reason, it is intended that votes will be cast for a substitute nominee designated by the Nominating and Corporate Governance Committee and approved by the Board. We have no reason to believe that any nominee named will be unable to serve if elected.
Director Information
Director Information The names and ages of the nominees and continuing directors, and their length of service with the Company and Board committee memberships are set forth in the table below.
Director Information
| Name | Age | Director Since | Class Current Term Expires | Independent | AC | CC | NCG | | Nominees for Class II Directors | | | | | | | | | Mudit Jain | 55 | July 2020 | Class III 2024 Annual Meeting | Yes | M | C | M | | Kirk Nielsen | 50 | July 2020 | Class III 2024 Annual Meeting | Yes | M | | M | | Martha Shadan | 68 | July 2021 | Class III 2024 Annual Meeting | Yes | — | M | — | | Continuing Directors | | | | | | | | | Ali Behbahani | 49 | July 2013 | Class I 2025 Annual Meeting | Yes | — | M | C | | Kevin Hykes | 58 | December 2022 | Class II 2026 Annual Meeting | No | — | — | — | | Joseph Slattery (ILD) | 59 | October 2008 | Class II 2026 Annual Meeting | Yes | F, C | M | — |
Director Information
| C: | Committee Chair | M: | Member | F: | Financial Expert | | AC: | Audit Committee | CC: | Compensation Committee | NCG: | Nominating and Corporate | | ILD: | Independent Lead Director | | | | Governance Committee |
Director Information
A brief biography of each nominee and each continuing director is set forth below, which includes information, as of the Record Date, regarding specific and particular experience, qualifications, attributes or skills of each nominee that led the Nominating and Corporate Governance Committee and the Board to believe that the director should serve on the Board.
Nominees for Terms Expiring in 2027 (Class III Directors)
Nominees for Terms Expiring in 2027 (Class III Directors) Mudit K. Jain, Ph.D. has served as a director on the Board since July 2020. He has served as a Founding General Partner at Treo Ventures I, L.P. (formerly known as Strategic Healthcare Investment Partners) (“Treo”), a medical device-focused venture capital firm, since September 2018, and previously served as a Managing Director at Synergy Venture Partners, LLC, a medical technology venture capital investment firm, from April 2007 to September 2018. Dr. Jain has also served as the CEO and co-founder of NuXcel, a medical device accelerator, since 2018. Dr. Jain currently serves on the boards of directors of Avivomed, Inc., Neochord, Inc., Neuspera, Inc., Noctrix, Inc., NuXcel, One Heart Health, a non-profit organization, ShiraTronics, Inc., and iVEAcare, Inc., and he previously served on the board of directors of Inspire Medical Systems, Inc., Aptus Endosystems, Inc., and Impres Medical, Inc. Dr. Jain received a Ph.D. in Biomedical Engineering from Duke University, an M.B.A. from The Wharton School of the University of Pennsylvania and a B.E. in Electrical Engineering from National Institute of Technology, Nagpur, India. The Board believes that Dr. Jain’s experience as a venture capital investor and expertise in biomedical engineering qualifies him to serve as a director on the Board. Kirk Nielsen has served as a director on the Board since July 2020. Mr. Nielsen has served as a Managing Partner at Vensana Capital, a medtech-focused investment firm, since January 2019 and as a Managing Director at Versant Ventures, a healthcare-focused venture capital firm, since January 2011. He currently serves on the board of directors of Inari Medical, Inc. (term ending April 24, 2024) and on several boards of directors for private companies, including: Alleviant Medical, Artelon Inc., Metavention, Inc., and Moxe Health Corporation, and previously served on the board of directors of Monteris Medical and SpyGlass Ophthalmics. Mr. Nielsen received an M.B.A. from Harvard Business School and an A.B. from Harvard College. The Board believes that Mr. Nielsen’s extensive management experience serving on the boards of directors of several medical technology companies qualifies him to serve as a director on the Board. Martha Shadan has served as a director on the Board since July 2021. Ms. Shadan has served as President and Chief Executive Officer of Miach Orthopaedics, a developer of bio-engineered surgical implants for connective tissue restoration, from January 2019 to June 2022. From January 2018 to December 2018, Ms. Shadan served as Global Vice President of Marketing at Smith & Nephew plc, a multinational medical equipment manufacturer, a role she assumed after the company acquired Rotation Medical, a medical device company focused on regenerative shoulder repair treatment, where she was President and Chief Executive Officer. Ms. Shadan led Rotation Medical through FDA approval and commercialization of the Rotation Medical Bioinductive Implant for rotator cuff tears (now known as REGENETEN), as well as the company’s acquisition by Smith & Nephew in December 2017. Prior to joining Rotation Medical in January 2013, Ms. Shadan served as President of the Trauma Division at Zimmer where she managed the P&L for the global business and Vice President/General Manager of Vascular Therapies and Vice President/General Manager of BioSurgery and Sports Surgery at Covidien, and she held various positions at Bristol Myers Squibb Co. and Merck Millipore. Ms. Shadan currently serves on the boards of directors of AdvaMed, a trade association, LeMaitre Vascular Inc., a medical device and human tissue cryopreservation company, and as Chair of the board of directors of BrilliantStrings Therapeutics. Ms. Shadan received an M.B.A. from Northeastern University, a Master of Science in Biology from Michigan State University and Bachelor of Science in Biology from the University of New Hampshire. The Board believes that Ms. Shadan’s significant executive leadership experience in the healthcare technology industry qualifies her to serve as a director on the Board.
Class I Director (Term Expiring in 2025)
Class I Director (Term Expiring in 2025) Ali Behbahani, M.D. has served as a director on the Board since July 2013. He joined New Enterprise Associates, Inc. (“NEA”), a venture capital firm, in 2007 and is a Partner and Co-Head of Healthcare. Prior to joining NEA, Dr. Behbahani served as a consultant in business development at The Medicines Company, a specialty pharmaceutical company developing acute care cardiovascular products. He previously held positions as a Venture Associate at Morgan Stanley Venture Partners and as a Healthcare Investment Banking Analyst at Lehman Brothers. Dr. Behbahani serves on the boards of directors of Adaptimmune Therapeutics plc, a biopharmaceutical company, Arcellx, Inc., a biotechnology company, Black Diamond Therapeutics, Inc., a precision oncology medicine company, CRISPR Therapeutics AG, a biotechnology company, Monte Rosa Therapeutics, Inc., a biotechnology company, Nkarta, Inc., a biotechnology company, and Korro Bio, Inc., a biopharmaceutical company, and previously served on the boards of directors of Genocea Biosciences, Inc., Nevro Corp., Minerva Surgical Inc., and Oyster Point Pharma, Inc. Dr. Behbahani received an M.D. from the University of Pennsylvania School of Medicine, an M.B.A. from The Wharton School of the University of Pennsylvania and a B.S. in Biomedical Engineering, Electrical Engineering and Chemistry from Duke University. The Board believes that Dr. Behbahani’s experience in the medical device industry and as a member of the boards of directors of multiple companies in the healthcare industry qualifies him to serve as a director on the Board.
Class II Directors (Terms Expiring in 2026)
Class II Directors (Terms Expiring in 2026) Kevin Hykes has served as our President and Chief Executive Officer, since February 2024, and as a director on the Board, since December 2022. Mr. Hykes previously served as the Chief Executive Officer of Augmedics, Inc., an augmented reality surgical navigation company, from December 2021 to February 2024. He has also served as a Venture Advisor to Vensana Capital, a medtech-focused investment firm, since November 2019. Mr. Hykes previously served as the President and Chief Executive Officer of each of Bardy Diagnostics, Inc., a remote cardiac monitoring and individual health services company, from August 2020 until its acquisition in June 2021, and Relievant, Inc., a provider of interventional treatment for chronic low back pain, from 2017 to January 2020. He also served as Chairman and Chief Executive Officer of Metavention Inc., a neuromodulation company, from 2013 to 2017, President and Chief Executive Officer of Cameron Health, Inc., a cardioverter-defibrillator medical device company, from 2010 until its acquisition in 2013, and Chief Commercial Officer of Visiogen, Inc., a developer of products for cataract and refractive patients, from 2008 until its acquisition in 2010. Mr. Hykes served as an Operating Partner at Versant Ventures, a healthcare focused venture capital firm, from 2013 to 2017. Mr. Hykes currently serves on the board of directors of Metavention Inc. and previously served on the boards of directors of Bardy Diagnostics, Inc., Relievant, Inc., and Veran Medical Systems, Inc., an interventional pulmonology medical device company. Mr. Hykes received a B.A. in Business Administration from the University of Wisconsin and an M.B.A. from Northwestern University. The Board believes that Mr. Hykes’ leadership of our company as our President and Chief Executive Officer, as well as his significant senior executive leadership experience in the healthcare technology industry, uniquely position him to contribute to the Board. Joseph Slattery has served as a director on the Board since October 2008. He previously served as the Executive Vice President and Chief Financial Officer of Asensus Surgical, Inc., a medical device company, from October 2013 to December 2019. Mr. Slattery also served as the Executive Vice President and Chief Financial Officer of Baxano Surgical, Inc., from April 2010 to September 2013. From February 1996 to August 2007, Mr. Slattery served in various roles of increasing responsibility at Digene Corporation, including as Chief Financial Officer and Senior Vice President of Finance and Information Systems, from October 2006 to August 2007. Mr. Slattery serves on the boards of directors of Morphic Therapeutic, Inc. and Replimune Group, Inc., and he previously served on the boards of directors of Baxano Surgical, Inc., Exosome Diagnostics, Inc., Micromet, Inc., and Omega Alpha SPAC. Mr. Slattery received a B.S. in Accounting from Bentley University and is a certified public accountant. The Board believes that Mr. Slattery’s extensive finance and business experience in the life sciences industry and his expertise in public accounting qualifies him to serve as a director on the Board. THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF EACH OF THE THREE NAMED DIRECTOR NOMINEES.
Committees of the Board of Directors
| • | reviewing and making recommendations to the Board regarding director compensation; and |
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION The directors play a critical role in guiding the Company’s strategic direction and in overseeing the Company’s management. The many responsibilities and risks and the substantial time commitment of being a director require that the Company provides adequate compensation commensurate with the directors’ workload and opportunity costs. Non-employee directors receive a combination of annual cash retainers and annual grants of stock options. Compensation of our non-employee directors is reviewed and determined by the Board on an annual basis. The annual cash retainers and equity compensation for non-employee directors who serve during only a portion of a fiscal year is pro-rated. The Board reviewed our non-employee director compensation and determined to not to increase the Director Compensation Program for fiscal 2023, which is described below:
DIRECTOR COMPENSATION
| Compensation Component | Amount ($) | | Cash Compensation: | | | Non-Employee Board Member | 40,000 | | Committee Chair | | | Audit | 20,000 | | Compensation | 15,000 | | Nominating and Corporate Governance | 10,000 | | Committee Member | | | Audit | 10,000 | | Compensation | 7,500 | | Nominating and Corporate Governance | 5,000 | | Chairman or Independent Lead Director | 32,500 | | Equity Compensation (Stock Options): | | | Non-Employee Board Member | 100,000 |
DIRECTOR COMPENSATION
Cash Compensation. Cash retainers are paid quarterly in arrears. Equity Compensation. Annual Grant: A non-employee director who is serving on the Board as of the date of the annual meeting of the Company’s stockholders shall be granted, on such annual meeting date, stock options with a grant date value of approximately $100,000, which shall vest in full on the earlier to occur of the first anniversary of the grant date and the date of the next annual meeting following the grant date. Initial Grant: Each non-employee director who is initially elected or appointed to serve on the Board shall be granted a stock option award with a grant date value of approximately $200,000. The initial equity grant will vest ratably on an annual basis over three years from the date of grant. Each such award will vest in full upon the death or permanent disability of the non-employee director and upon a change in control of the Company (as defined in the 2021 Equity Incentive Plan (the “2021 Plan”)). Compensation under our Director Compensation Program is subject to the annual limits on non-employee director compensation set forth in the 2021 Plan.
2023 Director Compensation Table
2023 Director Compensation Table The following table sets forth information for the year ended December 31, 2023, regarding the compensation awarded to, earned by or paid to the non-employee directors who served on the Board during 2023. Mr. Yared, who served as the Company’s President and Chief Executive Officer during the year ended December 31, 2023, and continued to serve in that capacity through February 11, 2024, does not receive additional compensation for his service as a director, and therefore is not included in the Director Compensation table below. All compensation paid to Mr. Yared is reported below in the “Summary Compensation Table.”
Director Compensation in 2023
Director Compensation in 2023
Director Compensation in 2023
| Director Name | Fees Earned or Paid in Cash ($) | Stock Option Awards ($)(1)(2) | Total ($) | | Ali Behbahani | 57,953 | 99,947 | 157,900 | | Kevin Hykes | 37,057 | 99,947 | 137,004 | | Mudit Jain | 59,029 | 99,947 | 158,976 | | John Nehra(3) | 56,209 | 0 | 56,209 | | Kirk Nielsen | 65,357 | 99,947 | 165,304 | | Martha Shadan | 47,500 | 99,947 | 147,447 | | Joseph Slattery | 67,500 | 99,947 | 167,447 |
Director Compensation in 2023
| (1) Amounts reflect the aggregate grant date fair value of stock options computed in accordance with the provisions of FASB ASC Topic 718. Assumptions used in the calculation of these amounts are included in Note 7 to our financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. As required by SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. |
Director Compensation in 2023
| (2) As of December 31, 2023, the non-employee directors held outstanding stock options to acquire the following number of shares of the Company’s common stock: |
Director Compensation in 2023
| Director Name | Outstanding Stock Options (#) | | Ali Behbahani | 54,307 | | Kevin Hykes | 39,034 | | Mudit Jain | 49,379 | | John Nehra | 29,737 | | Kirk Nielsen | 50,643 | | Martha Shadan | 73,870 | | Joseph Slattery | 89,108 |
Director Compensation in 2023
| (3) Mr. Nehra’s service on the Board concluded on June 5, 2023 when his term ended at the 2023 annual meeting of stockholders. |
2024 Director Compensation Changes
2024 Director Compensation Changes In early 2024, the Compensation Committee reviewed market data on director compensation compiled by the Compensation Committee’s independent compensation consultant for the same peer group used for setting executive compensation. Upon review, the Compensation Committee recommended, and the Board approved, the following changes to the director compensation program for 2024 to more closely align with relevant market data:
2024 Director Compensation Changes
| • | Increase in the annual cash compensation for all non-employee directors from $40,000 to $45,000; and |
2024 Director Compensation Changes
| • | Increase in the grant date value for the annual stock option grant for non-employee directors from $100,000 to $130,000 (and a corresponding increase in the initial grant value from $200,000 to $260,000). |
Summary Compensation Table
Summary Compensation Table The following table discloses compensation paid by us during the fiscal years set forth below to our NEOs:
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($)(1) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($)(4) | Total ($) | | Nadim Yared | 2023 | 577,300 | — | 2,116,160 | 448,297 | 851 | 3,142,608 | | Former President and Chief Executive Officer | 2022 | 530,400 | — | 1,217,179 | 233,151 | 654 | 1,981,384 | | Jared Oasheim | 2023 | 380,000 | — | 740,656 | 196,724 | — | 1,317,380 | | Chief Financial Officer | 2022 | 345,000 | — | 376,684 | 101,102 | — | 822,786 | | Paul Verrastro | 2023 | 390,000 | — | 476,136 | 208,972 | — | 1,075,108 | | Chief Marketing and Strategy Officer | 2022 | 367,500 | 30,000 | 303,262 | 132,343 | — | 833,105 |
Summary Compensation Table
| (1) The amount for Mr. Verrastro reflects a $30,000 bonus for 2022 to recognize his contributions stepping into an additional strategy role. |
Summary Compensation Table
| (2) Amounts shown in this column do not reflect dollar amounts actually received by our NEOs. Instead, these amounts reflect the aggregate grant date fair value of each stock option granted in the relevant year, computed in accordance with the provisions of FASB ASC Topic 718. Assumptions used in the calculation of these amounts are included in Note 7 to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. As required by SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. Our NEOs will only realize compensation to the extent the trading price of our common stock is greater than the exercise price of such stock options. |
Summary Compensation Table
| (3) The amounts represent the annual cash incentive awards earned by each NEO. |
Summary Compensation Table
| (4) The amounts reported in the All Other Compensation column for 2023 and 2022 represent reimbursement for Mr. Yared’s commuting expenses. |
Outstanding Equity Awards at 2023 Fiscal Year-End
Outstanding Equity Awards at 2023 Fiscal Year-End The following table presents information regarding outstanding equity awards held as of December 31, 2023 by our NEOs.
Outstanding Equity Awards at 2023 Fiscal Year-End
| | | Option Awards | | | | | Name | Vesting Commencement Date | Number of Securities Underlying Unexercised Options – Exercisable (#)(1) | Number of Securities Underlying Unexercised Options – Unexercisable (#)(1) | Option Exercise Price ($) | Option Expiration Date | | Nadim Yared | 10/4/2006 | 31,037 | — | 0.237 | 8/6/2025 | | | 7/29/2009 | 11,375 | — | 0.237 | 8/6/2025 | | | 4/19/2011 | 11,377 | — | 0.237 | 8/6/2025 | | | 7/1/2015 | 14,169 | — | 0.237 | 6/30/2025 | | | 9/28/2016 | 37,093 | — | 0.237 | 9/27/2026 | | | 2/16/2018 | 70,041 | — | 0.237 | 2/15/2028 | | | 1/28/2019 | 77,424 | — | 0.237 | 2/15/2028 | | | 7/24/2019 | 87,690 | — | 3.955 | 7/23/2029 | | | 10/1/2020 | 101,084 | — | 4.350 | 9/30/2030 | | | 10/1/2020 | 45,635 | — | 4.350 | 9/30/2030 | | | 10/1/2020 | 35,513 | 9,346(2) | 4.350 | 9/30/2030 | | | 2/4/2021 | 35,820 | 14,750(2) | 7.119 | 2/3/2031 | | | 6/29/2021 | 61,125 | 36,675(2) | 18.000 | 6/28/2031 | | | 1/18/2022 | 89,316 | 97,084(2) | 9.080 | 1/17/2032 | | | 8/2/2022 | 20,000 | 40,000(2) | 9.010 | 8/1/2032 | | | 1/18/2023 | — | 200,000(2) | 15.220 | 1/17/2033 | | Jared Oasheim | 7/24/2020 | 11,732 | — | 3.955 | 7/23/2029 | | | 10/1/2020 | 15,163 | — | 4.350 | 9/30/2030 | | | 10/1/2020 | 6,844 | — | 4.350 | 9/30/2030 | | | 10/1/2020 | 5,368 | 1,413(2) | 4.350 | 9/30/2030 | | | 10/16/2020 | 30,026 | 7,902(2) | 4.350 | 9/30/2030 | | | 2/4/2021 | 21,491 | 8,851(2) | 7.119 | 2/3/2031 | | | 6/29/2021 | 22,937 | 13,763(2) | 18.000 | 6/28/2031 | | | 1/18/2022 | 26,929 | 29,271(2) | 9.080 | 1/17/2032 | | | 8/2/2022 | 6,666 | 13,334(2) | 9.010 | 8/1/2032 | | | 1/18/2023 | — | 70,000(2) | 15.220 | 1/17/2033 | | Paul Verrastro | 1/5/2021 | 55,467 | 25,339(2) | 5.141 | 1/4/2031 | | | 2/4/2021 | 21,491 | 8,851(2) | 7.119 | 2/3/2031 | | | 6/29/2021 | 11,875 | 7,125(2) | 18.000 | 6/28/2031 | | | 1/18/2022 | 19,741 | 21,459(2) | 9.080 | 1/17/2032 | | | 8/2/2022 | 6,666 | 13,334(2) | 9.010 | 8/1/2032 | | | 1/18/2023 | — | 45,000(2) | 15.220 | 1/17/2033 |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (1) As noted in the footnotes below, certain of these stock options have vested but remain subject to restrictions on exercise. In addition to the vesting schedules described in the footnotes below, each of the stock option grants disclosed in this table provides that vesting of 50% of the unvested portion of the stock option award (or our repurchase right, in respect of the option grants discussed in footnote (2)) will accelerate upon a Change in Control (as defined in the applicable award agreement), and the remainder of the unvested portion of the stock option (or our repurchase right, with respect to the option grants discussed in footnote (2)) will vest if, within six months following the effective date of a Change in Control, the NEO’s employment is terminated by the NEO due to Constructive Discharge or by us for any reason other than for Cause. Constructive Discharge and Cause are defined in the applicable award agreement and are consistent with the same terms included in executive employment agreements as described under “Employment Agreements” above. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (2) The vesting schedule provides for 25% of the shares forming part of each grant to vest on the first anniversary of the grant date, and for 1/48th of the shares to vest monthly thereafter, subject to the NEO’s continuous employment through the relevant vesting dates. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (3) The vesting schedule provides for 75% of the award to vest on the vesting commencement date and 25% of the award to vest 1/48th per month thereafter, subject to the NEO’s continuous employment through the relevant vesting dates. |