DEF 14A of Sight Sciences, Inc.
Filed Apr 26, 2024 · FY20230001140361-24-022158
Proposal 1: Election of Directors
Proposal 1: Election of Directors
Election of Directors
Election of Directors At the Annual Meeting, our stockholders are being asked to vote for three Class III Director nominees, David Badawi, M.D., Tamara Fountain, M.D. and Donald Zurbay, to hold office until the 2027 Annual Meeting of Stockholders and until each such director’s respective successor is elected and qualified, or until each such director’s earlier death, resignation or removal. Each of the Class III Director nominees is a current member of the Board and a Class III Director whose term expires at the Annual Meeting. Each director nominee has consented to serve if elected, and the Board has no reason to believe that any of the nominees will be unable or unwilling to serve as a director. If, however, any of Dr. Badawi, Dr. Fountain or Mr. Zurbay withdraws or otherwise becomes unable to serve, our Board may decrease the size of the Board, or the proxies may be voted for the election of a substitute director nominee our Board may recommend in place of the nominee.
Donald Zurbay
Donald Zurbay Donald Zurbay has served as a member of our Board since July 2020. Since October 2022, Mr. Zurbay has served as the President, Chief Executive Officer and a member of the board of directors of Patterson Companies, Inc. (Nasdaq: PDCO), a publicly traded global medical device company. From June 2018 to October 2022, Mr. Zurbay served as the Chief Financial Officer of Patterson Companies. From March 2004 to February 2017, Mr. Zurbay held various leadership positions at St. Jude Medical, Inc., where he most recently served as Vice President and Chief Financial Officer from August 2012 to January 2017. Mr. Zurbay currently serves as a member of the board and member of the audit committee and compensation committee of Silk Road Medical, Inc. (Nasdaq: SILK) and served as a member of the board and member of the audit committee of Avedro, Inc., a publicly traded medical technology company acquired by Glaukos Corporation in 2019, from July 2017 to November 2019. Mr. Zurbay holds a B.S. in Business Accounting from the University of Minnesota. We believe Mr. Zurbay’s experience with publicly-traded healthcare companies and financial expertise qualify him to serve on our Board. We further believe Mr. Zurbay’s other public company executive and board obligations have not impaired his ability to dedicate appropriate and invaluable attention to his duties as a director. As a member of our Board, Mr. Zurbay has effectively employed his deep accounting background in combination with his senior executive experience and extensive medical device industry background to effectively help guide the strategic direction of the Company. Continuing Members of the Board:
Class I Directors (terms to expire at the 2025 Annual Meeting of Stockholders)
Class I Directors (terms to expire at the 2025 Annual Meeting of Stockholders) The current members of the Board who are Class I Directors are as follows:
Class I Directors (terms to expire at the 2025 Annual Meeting of Stockholders)
| Name | Age | Served as a Director Since | Position with Sight Sciences | | Paul Badawi | 49 | 2011 | President, Chief Executive Officer and Director | | Erica Rogers | 61 | 2019 | Director | | Brenda Becker | 64 | 2022 | Director |
Class I Directors (terms to expire at the 2025 Annual Meeting of Stockholders)
The principal occupations and business experience, for at least the past five years, of each Class I Director are as follows:
Paul Badawi
Paul Badawi Paul Badawi is a co-founder of our Company and has served as our President, Chief Executive Officer and a member of our Board since the Company was founded in 2011. Prior to launching the Company, Mr. Badawi led the U.S. healthcare venture capital practice of 3i Group, a global private equity firm. Prior to 3i, Mr. Badawi worked at the National Institutes of Health as a Research Fellow in the field of biochemical genetics. Mr. Badawi holds an M.B.A. from the University of California, Los Angeles and a B.S. in Biological Sciences from the University of Chicago. We believe Mr. Badawi’s extensive experience in the industry and knowledge of our Company qualify him to serve on our Board.
Erica Rogers
Erica Rogers Erica Rogers has served as a member of our Board since November 2019. From October 2012 to November 2023, Ms. Rogers served as President, Chief Executive Officer and a member of the board of directors of Silk Road Medical, Inc. (Nasdaq: SILK), a publicly traded medical device company. Ms. Rogers serves as an advisor to Venture Investors and previously served as an advisor to Alydia Health, which was acquired by Organon in 2021. From August 2020 to September 2022, Ms. Rogers served as a member of the board of directors and member of the compensation committee and audit committee of Lucira Health, Inc., a publicly traded diagnostics company that was acquired by Pfizer Inc. in 2023. Ms. Rogers holds a B.S. in Zoology from San Diego State University. We believe Ms. Rogers’ extensive experience in the medical device industry qualifies her to serve on our Board.
Brenda Becker
Brenda Becker Brenda Becker has served as a member of our Board since March 2022. Since 2007, Ms. Becker has served as the Senior Vice President, Global Government Affairs for Boston Scientific. Prior to joining Boston Scientific, Ms. Becker served in the George W. Bush administration under former Vice President Dick Cheney as Assistant to the Vice President for Legislative Affairs. In that capacity, she advised the Vice President and senior White House staff on legislative strategy from 2004 to 2007. In addition, from 2001 to 2004, Ms. Becker served as the Assistant Secretary for Legislative and Intergovernmental Affairs at the U.S. Department of Commerce where she provided counsel to the Secretary of Commerce and other senior commerce officials. Ms. Becker holds a B.A. in Political Science and Public Administration from Michigan State University and an M.B.A. from Central Michigan University. We believe Ms. Becker’s extensive experience in the medical device industry and legislative expertise qualify her to serve on our Board.
Class II Directors (terms to expire at the 2026 Annual Meeting of Stockholders)
Class II Directors (terms to expire at the 2026 Annual Meeting of Stockholders) The current members of the Board who are Class II Directors are as follows:
Class II Directors (terms to expire at the 2026 Annual Meeting of Stockholders)
| Name | Age | Served as a Director Since | Position with Sight Sciences | | Staffan Encrantz | 72 | 2017 | Chairperson | | Catherine Mazzacco | 59 | 2023 | Director |
Class II Directors (terms to expire at the 2026 Annual Meeting of Stockholders)
The principal occupations and business experience, for at least the past five years, of each Class II Director are as follows:
Staffan Encrantz
Staffan Encrantz Staffan Encrantz has served as Chairperson of the Board since October 2017. Mr. Encrantz is the President and Founder of Allegro Investment Inc., the investment manager of Allegro Investment Fund, L.P., and has served as such since 1997. He has over thirty years of experience in the management and operations of companies in an array of industries and in a variety of roles, including as an executive, board member and investor. Since 2022, Mr. Encrantz has served on the board of directors of Alligator Biosciences AB, a Swedish pharmaceutical company listed on Nasdaq in Stockholm (XSTO: ATORX). Mr. Encrantz serves on the boards of directors of various private operating entities across a range of industries, including service as chairperson on a number of these boards. Mr. Encrantz holds a Bachelor of Law and a Business Studies degree from Uppsala University, Sweden. We believe Mr. Encrantz’ financial and industry experience and wealth of board experience, including service as chairperson of a number of commercial operating entities within and outside of the life sciences industry, qualify him to serve on our Board.
Catherine Mazzacco
Catherine Mazzacco Catherine Mazzacco has served as a member of our Board since June 2023. Ms. Mazzacco was Chief Executive Officer and President of LEO Pharma, a privately owned global pharmaceutical company, and a member of its board of directors, from August 2019 to November 2021. Prior to this role, Ms. Mazzacco was Senior Vice President, Global Commercial Operations, Life Sciences Division at GE HealthCare Technologies, Inc. (Nasdaq: GEHC) (“GE HealthCare”), a leading publicly traded global medical technology company, from February 2018 to May 2019. Before joining GE HealthCare, Ms. Mazzacco spent over 25 years at Abbott Laboratories (NYSE: ABT), a multinational publicly traded healthcare company where she held several global senior operational and strategic leadership roles, including, most recently, as Vice President, Global Commercial Operations, Abbott Vision Division from 2011 to 2017. Ms. Mazzacco has served as a member of the board of directors and a member of the nominating and governance committee and commercial advisory committee of Krystal Biotech, Inc. (Nasdaq: KRYS), a publicly traded gene therapy biotechnology company, since March 2023. Ms. Mazzacco has served as a member of the supervisory board and remuneration and nomination committee of Servier SAS, a privately owned global pharmaceutical company, since February 2022. Ms. Mazzacco holds a Bachelor of Science in Engineering, Option Biotechnology from the University of Compiègne in France. We believe Ms. Mazzacco’s deep healthcare knowledge as well as her extensive international, commercial, financial, operational and transformation expertise qualifies her to serve on our Board.
Compensation Committee
| • | reviewing and making recommendations to the Board with respect to director compensation; |
Compensation Philosophy and Objectives
| • | 50th percentile of peer group for base salary levels; |
Compensation Philosophy and Objectives
| • | 50th percentile of peer group for target bonus levels; and |
Compensation Philosophy and Objectives
| • | up to 75th percentile of peer group for equity compensation levels. |
Compensation Consultant
Compensation Consultant Since the completion of our initial public offering, the committee has engaged Compensia, Inc. (“Compensia”) to provide independent compensation advisory services directly to the committee. These services have included: (i) advising the committee on the selection of an appropriate peer group of other publicly traded healthcare companies, (ii) collecting and analyzing compensation data from the peer group companies, (iii) performing an independent review of our compensation practices for our executive officers and non-employee directors as compared to the peer group, (iv) providing advice with respect to our cash incentive compensation and equity grant practices and strategy, and (v) making recommendations regarding the design and structure of our compensation program. The decision to engage Compensia was made by the committee, and Compensia reports directly to the committee. While members of our management regularly communicate with representatives of Compensia, our management does not direct or oversee the scope of services provided by or the compensation paid to Compensia. While we are not obligated to retain an independent compensation consultant, the committee believes the use of an independent consultant provides additional assurance that our compensation program is attractive and competitive in the marketplace, consistent with market conditions, and reflective of our executive compensation philosophy and objectives. The committee regularly assesses whether the work of Compensia as a compensation consultant has raised any potential conflicts of interest, taking into account the following factors: (i) the amount of fees paid by us to Compensia as a percentage of that firm’s total revenue, (ii) the provision of other services to us by Compensia, (iii) Compensia’s policies and procedures that are designed to prevent conflicts of interest, (iv) any business or personal relationship of the individual compensation advisors with any member of the committee, (v) any business relationship of Compensia or business or personal relationship of the individual compensation advisors, with any of our executive officers, and (vi) any ownership of our stock by Compensia or the individual compensation advisors. Based on the above factors, the committee has concluded that the work of Compensia, including the work performed by the individual compensation advisors employed by Compensia, has not created any conflict of interest.
Peer Group
Peer Group In September 2022, the committee considered and approved a peer group, which we refer to as our 2023 peer group, for purposes of compensation decisions made in 2023. The 2023 peer group was determined primarily based on these companies’ similarities to us as of the time the survey was performed, with reference to factors including revenue, market capitalization, industry, target markets, stage of growth, number of employees and geographic location. In selecting our 2023 peer group, the committee also expressed its desire to generally maintain consistency of our peer group as compared to the previous year, as appropriate within the context of the recent decline in our market capitalization and related considerations. Our 2023 peer group was comprised of the 20 medical device companies listed below, of which 12 were also part of our peer group in the prior year. With respect to those peer companies that were significantly larger than us based on revenue, market capitalization or other factors, the committee focused on other characteristics of these companies and their operations in determining their suitability for continued inclusion in our peer group, including industry, nature of business and target markets.
Peer Group
| • Apollo Endosurgery • Atrion • AxoGen • Berkeley Lights • ClearPoint Neuro | • Glaukos • Harvard Bioscience • iRadimed • LeMaitre Vascular • Mesa Laboratories | • OrthoPediatrics • Outset Medical • Personalis • Pulmonx • SeaSpine Holdings | • Semler Scientific • Si-BONE • Silk Road Medical • Transmedics Group • ViewRay |
Peer Group
In September 2023, the committee considered and approved an updated peer group, which we refer to as our 2024 peer group, for purposes of 2024 compensation decisions. In selecting our 2024 peer group, the committee assessed similar factors as those used to determine our prior peer groups, including changes in respective market capitalizations and similar factors. Our 2024 peer group is comprised of the 19 companies in the medical device and biotechnology industries listed below, of which 12 were also part of our 2023 peer group.
Peer Group
| • Apyx Medical • Artivion • Atrion • AxoGen • ClearPoint Neuro | • Cutera • CVRx • Harvard Bioscience • iRadimed • Mesa Laboratories | • OrthoPediatrics • Outset Medical • Pulmonx • RxSight • Semler Scientific | • Si-BONE • Silk Road Medical • TELA Bio • Zynex |
Governance Practices and Policies
| • | Independent Compensation Committee Advisor. Consistent with prior years, the committee engaged its own independent compensation consultant to assist with its compensation review for 2023. |
Governance Practices and Policies
| • | Long-Term Vesting Requirements. The long-term equity awards granted to our executives generally vest over four-year periods, consistent with current market practice and our retention objectives, except in limited circumstances where deemed necessary by the committee to recruit or retain executives. |
Governance Practices and Policies
| • | No Tax Reimbursements on Severance or Change in Control Payments. We do not provide any tax reimbursement payments (including “gross-ups”) on any severance or change-in-control payments or benefits. |
Elements of Our Executive Compensation Program
Annual Cash Incentive Compensation We maintain an annual cash incentive program, or cash bonus program, for all employees who are not eligible for commissions and who are otherwise eligible to participate in the program, including our named executive officers. Participants in the program may earn a performance-based cash bonus based on the achievement of pre-determined business and strategic objectives deemed by the committee to be critical to driving long-term stockholder value. With regard to our senior executives, including our named executive officers, one hundred percent of the cash bonuses for 2023 were tied to the achievement of pre-determined corporate performance objectives, while the cash bonuses payable to our other employees were determined with regard to the achievement of a combination of corporate and individual performance metrics. The committee believes this approach is appropriate because our senior executives are in the best position to drive achievement of our corporate objectives and the committee holds the executives directly accountable for the results. 2023 Target Bonus Amounts For 2023, the named executive officers had the following target annual bonus amounts, expressed as a percentage of base salary received during the year:
Elements of Our Executive Compensation Program
| Named Executive Officer | 2023 Bonus Target | | Paul Badawi | 90% | | Alison Bauerlein | 50% | | Matthew Link | 50% |
Elements of Our Executive Compensation Program
Target bonus percentages for each named executive officer were determined by the committee based on a review of compensation data from the 2023 peer group provided by Compensia, as well as additional factors deemed relevant by the committee. 2023 Business and Strategic Objectives The business and strategic objectives approved by the committee for the 2023 cash bonus program related to pre-determined commercial (weighted 60%), financial (weighted 20%), clinical (weighted 10%) and reimbursement (weighted 10%) objectives. In addition, for the commercial and financial objectives, the committee adopted minimum threshold targets such that no payments were eligible to be made with respect to these components if the minimum performance level was not achieved. The committee also adopted maximum payouts regardless of the performance levels to ensure bonus payments are reasonable and limit compensation-related risk. If all corporate objectives had been achieved, the 2023 cash bonus program could have paid out at a maximum of 127% of the target bonus for each eligible employee. The following table provides additional detail regarding the 2023 business and strategic objectives, the relative weighting of each objective, the 2023 target for each objective, the 2023 actual performance relative to each objective, and the achievement percentage for each objective.
Elements of Our Executive Compensation Program
| 2023 Business and Strategic Objectives | Weighting % | 2023 Target | 2023 Actual Performance | Achievement Percentage | | Aggregate Revenue Objective (Surgical Glaucoma and Dry Eye) | 30% | Target: ≥$96 million (100% of target). Maximum Threshold: ≥ $100 million (150% of target). Minimum Threshold: ≥$89 million (50% of target). No payout below this threshold. | $81.1 million. Below minimum threshold. | 0.0% of target | | Surgical Glaucoma Revenue Objective | 15% | Target: ≥$88 million (100% of target). Maximum Threshold: ≥ $91.5 million (120% of target). Minimum Threshold: ≥$81.4 million (50% of target). No payout below this threshold. | $74.3 million. Below minimum threshold. | 0.0% of target | | Dry Eye Revenue Objective | 15% | Target: ≥$8 million (100% of target). Maximum Threshold: ≥$8.5 million (120% of target). Minimum Threshold: ≥$7.6 million (50% of target). No payout below this threshold. | $6.7 million. Below minimum threshold. | 0.0% of target | | Financial Objective - Cash Burn | 20% | Target: ≤$40 million cash burn (defined as GAAP operating income adjusted for non-cash items). (100% of target) Maximum Threshold: ≤$36 million (110% payout). Minimum Threshold: ≤ $44 million cash burn (95% of target). No payout below this threshold. | $39.3 million. Target exceeded. | 102% of target | | Clinical Objective – Data Publication | 10% | Target: SAHARA RCT study publication submission date by October 31, 2023. (100% of target) Maximum Threshold: Publication by August 31, 2023. (120% of target) Minimum Threshold : Publication by December 31, 2023. (80% of target) | Submitted August 2023. Target exceeded. | 120% of target | | Reimbursement Objective - Contracts | 10% | Target: Achieve at least two specific reimbursement coverage contracts. (100% of target) Maximum Threshold: Achieve four specific reimbursement coverage contracts. (120% of target) Minimum Threshold: Achieve one specific reimbursement coverage contract. (80% of target) | Four reimbursement coverage contracts received. Target exceeded. | 120% of target |
Elements of Our Executive Compensation Program
2023 Cash Bonus Amounts In February 2024, the committee determined our achievement rate as against our 2023 corporate and strategic objectives was 44.3% of the target achievement level, resulting in the payment of bonuses to our named executive officers in an amount equal to 44.3% of their respective target bonus amounts. The 2023 cash bonuses paid to our named executive officers are included in the “Non-Equity Incentive Plan Compensation” column of the 2023 Summary Compensation Table below. The bonus achievement rate reflected our over-achievement of the financial, clinical and reimbursement objectives, but the inability to achieve our commercial objectives pertaining to revenue growth, which reflected 60% of the aggregate bonus opportunity. While our total revenue increased 14% in 2023 compared to the prior year, the minimum revenue growth rate required for payout under the commercial objective was set at 25% to receive a 90% payout, and 35% to receive a 100% payout. Since we did not achieve the threshold level of revenue growth performance, no bonus was payable with respect to the commercial milestone component of the cash bonus program. Our inability to achieve our commercial objectives arose primarily out of certain unexpected reimbursement uncertainties. In June 2023, five of the seven Medicare Administrative Contractors, or MACs, published local coverage determinations, or LCDs, that would have characterized certain procedures associated with our OMNI and SION technologies as investigational and thus non-covered for Medicare beneficiaries in the jurisdictions covered by those MACs. While these LCDs were ultimately withdrawn before they became effective, the uncertainty of coverage combined with accounts reducing inventory levels led to lower sales in our surgical glaucoma segment in the second half of 2023. While we were unable to achieve our commercial objectives, we were able to achieve our cash burn, clinical, and reimbursement objectives. For our cash burn objective, we proactively adjusted our planned spending in 2023 to account for lower revenue, and were able to adjust our plans to still meet this objective without compromising on our long-term value drivers, including investing in our pipeline, commercial infrastructure, and market access initiatives. In addition, across the organization we incurred lower incentive-based compensation (bonuses and commissions) due to lower revenue. Our other key value drivers, including the submission of our SAHARA RCT and achieving four reimbursement contracts for our OMNI Surgical System, were achieved ahead of expectations. Since we exceeded the threshold and target levels for our cash burn, clinical, and reimbursement objectives, bonuses were payable for these components of the cash bonus program as reflected in the table above. Pay-for-Performance Philosophy The committee evaluated the circumstances of our failure to achieve our commercial objectives, including the potential impact of the 2023 cash bonus payouts on our ability to motivate and retain our key employees. and determined no discretionary adjustments to the final corporate achievement percentage would be made, notwithstanding the significant contributions made by our employees to the growth and success of the business during the year. The strong correlation between the achievement of our business and strategic objectives and the actual compensation paid under our 2023 cash bonus program reflects our commitment to our pay-for-performance philosophy.
Equity Incentive Compensation
Equity Incentive Compensation We generally offer equity awards to our employees, including our named executive officers, as the long-term incentive component of our executive compensation program. New equity awards are made pursuant to our 2021 Incentive Award Plan, which has been approved by our Board and stockholders. Historically, we offered stock options to our employees, but beginning in September 2021, we commenced the grant of restricted stock units, or RSUs, in addition to stock options. Stock options generally allow employees to purchase shares of our common stock at a price equal to the fair market value of our common stock on the grant date, as determined by the Board. RSUs generally allow employees to receive shares of our common stock upon the vesting and settlement of the RSUs. Stock options granted upon an employee’s commencement of employment generally vest as to 25% of the underlying shares on the first anniversary of the grant date and in equal monthly installments over the following three years. Subsequent grants of stock options to employees generally vest as to 1/48th of the shares underlying the stock option each month for four years following the grant date. Historically, our stock options have been intended to qualify as “incentive stock options” to the extent permitted under the Internal Revenue Code. Prior to 2024, the RSUs we granted generally vested in four equal annual tranches on each anniversary of the grant date. Commencing with our 2024 annual equity grant cycle, we granted RSUs that vest in equal quarterly installments for four years following the grant date. In the case of new employees, RSUs vest as to 25% of the underlying shares on the first anniversary of the grant date and in equal quarterly installments over the following three years. During 2023, our committee made certain other adjustments to our equity grant philosophy to:
Equity Incentive Compensation
| • | move away from determination of equity awards based on number of shares issuable upon exercise or settlement of such awards to determination of equity awards based on fixed dollar value; |
Equity Incentive Compensation
| • | alter the historical mix of stock options and RSUs granted to employees such that our employees at all levels of the organization, including our named executive officers, receive more RSUs than stock options (based on fixed dollar value); and |
Equity Incentive Compensation
| • | provide that exempt, entry-level employees will not be eligible to receive equity grants until they have reached a certain tenure level. |
Equity Incentive Compensation
During 2023, our committee evaluated our historical use of time-based vesting with respect to our equity awards. While we believe time-based vesting continues to be appropriate in light of peer group practices with respect to equity grants, employee retention and engagement considerations, and our status as a relatively new public company, the committee has discussed the appropriate timing for the introduction of performance-based vesting for equity awards granted to our executives. The committee currently plans to consider the use of performance-based vesting commencing with the 2025 equity grant cycle for a portion of the awards granted to key senior executives, though the committee retains the discretion to accelerate or delay this timeframe. When determining the value of equity awards to be granted to each named executive officer, the committee generally considers several factors, including the position and level of responsibility of the executive, the timing and value of recent equity awards granted to the executive, the executive’s tenure with us, and peer group survey data regarding the level of equity ownership by executives with similar titles and levels of responsibility at the peer group companies. The committee also takes into account our achievement of significant milestones during the period prior to the grant date, such as revenue growth, important clinical or regulatory achievements, and the retentive effect of outstanding option awards given that a significant portion of our outstanding option awards are currently substantially “out of the money.” During the fourth quarter of 2022, we conducted an equity-focused employee retention and engagement program pursuant to which we granted RSUs to all employees other than our executive team. This program was in recognition of the fact that a significant portion of employee equity was “out of the money” at such time and thus had little or no retentive effect, and was also intended to reward the significant contributions made by our employees to the achievement of our strategic objectives during a challenging year. During the committee’s compensation review in the first quarter of 2023, it elected to extend this retention and engagement program to our senior executives. In doing so, the committee determined stock options were the appropriate equity vehicle to use for the program, as such awards only have value to the extent our stock price increases above their exercise price, which directly aligns the interests of our executives with those of our stockholders. Thus, in March 2023, in addition to his annual equity award, the committee approved a one-time stock option award to Mr. Badawi exercisable for up to 102,600 shares of common stock at an exercise price of $9.78 per share. The other members of our senior executive team also received one-time stock option awards at the same time (although Ms. Bauerlein and Mr. Link did not receive these awards as they commenced employment with us following the issuance of awards under the program). In April and September 2023, respectively, Ms. Bauerlein and Mr. Link received equity awards in connection with the commencement of their employment with us. The value of the awards was primarily determined based on an analysis of equity awards typically received by executives with similar titles and levels of responsibility upon commencement of employment, based on an assessment of peer group survey data provided by Compensia. The stock options and RSUs granted to our named executive officers during 2023 are described in the tables below.
Equity Incentive Compensation
| Named Executive Officer | 2023 Aggregate Option Awards | | Paul Badawi | 225,700(1) | | Alison Bauerlein | 71,800(2) | | Matthew Link | 526,430(3) |
Equity Incentive Compensation
| (1) Reflects (i) a stock option exercisable for up to 123,100 shares of our common stock, and (ii) a stock option exercisable for up to 102,600 shares of our common stock, in each case at an exercise price of $9.78 per share. Each of these option awards vest over 48 equal monthly installments following the grant date, subject to Mr. Badawi’s continued service to us through the applicable vesting dates. |
Equity Incentive Compensation
| (2) In connection with commencement of her employment with us on April 3, 2023, Ms. Bauerlein received stock options to purchase up to 71,800 shares of our common stock at an exercise price of $10.10 per share, which vested and became exercisable as to 25% of the underlying shares on April 3, 2024, and shall vest as to the remainder of such shares in 36 equal monthly installments thereafter, subject to Ms. Bauerlein’s continued service to us through the applicable vesting dates. |
Equity Incentive Compensation
| (3) In connection with commencement of his employment with us on September 11, 2023, Mr. Link received stock options to purchase up to 526,430 shares of our common stock at an exercise price of $2.06 per share, which shall vest and became exercisable as to 25% of the underlying shares on September 11, 2024, and as to the remainder of such shares in 36 equal monthly installments thereafter, subject to Mr. Link’s continued service to us through the applicable vesting dates. |
Equity Incentive Compensation
| Named Executive Officer | 2023 Aggregate RSU Awards | | Paul Badawi | 176,600(1) | | Alison Bauerlein | 103,000(2) | | Matthew Link | 747,572(3) |
Equity Incentive Compensation
| (1) Reflects an annual grant of 176,600 RSUs, which vest in four equal annual installments commencing January 15, 2024 and continuing through January 15, 2027, subject to Mr. Badawi’s continued service to us through the applicable vesting dates. |
Equity Incentive Compensation
| (2) In connection with commencement of her employment with us on April 3, 2023, Ms. Bauerlein received a grant of 103,000 RSUs, which vest in four equal annual installments commencing May 15, 2024 and continuing through May 15, 2027, subject to Ms. Bauerlein’s continued service to us through the applicable vesting dates. |
Equity Incentive Compensation
| (3) In connection with commencement of his employment with us on September 11, 2023, Mr. Link received a grant of 747,572 RSUs, which vest in four equal annual installments commencing October 15, 2024 and continuing through October 15, 2027, subject to Mr. Link’s continued service to us through the applicable vesting dates. |
Employment, Severance or Change in Control Agreements
Employment, Severance or Change in Control Agreements We have entered into employment agreements with each of our named executive officers. Under the employment agreements, if we terminate a named executive officer’s employment without “cause,” or the named executive officer resigns for “good reason” (and other than in connection with a change in control), subject to the execution and non-revocation of a separation agreement and release with the Company and compliance with restrictive covenants contained therein, the named executive officer will be entitled to receive (i) continued payment of base salary for 18 months for Mr. Badawi, or 12 months for Ms. Bauerlein and Mr. Link, (ii) any unpaid bonus earned for the year prior to the year of termination, (iii) for Mr. Badawi, a prorated annual bonus for the year of termination based on actual performance and payable when annual bonuses for such year are paid to other executives of the Company, and (iv) direct payment of or reimbursement for COBRA premiums, less the amount the named executive officer would have paid for coverage as an active employee, for up to 18 months for Mr. Badawi, and for up to 12 months for Ms. Bauerlein and Mr. Link. If such a qualifying termination occurs on or within 12 months following the date of a change in control, subject to the execution and non-revocation of a separation agreement and release with the Company and compliance with restrictive covenants contained therein, the named executive officer will be entitled to receive, in lieu of the payments and benefits described above, (i) continued payment of the named executive officer’s base salary for 24 months for Mr. Badawi, or 18 months for Ms. Bauerlein and Mr. Link, (ii) any unpaid bonus earned for the year prior to the year of termination, (iii) a payment equal to 2 times for Mr. Badawi, or 1.5 times for Ms. Bauerlein and Mr. Link, the named executive officer’s target annual bonus for the year of termination, (iv) direct payment of or reimbursement for COBRA premiums, less the amount the named executive officer would have paid for coverage as an active employee, for up to 24 months for Mr. Badawi, or 18 months for Ms. Bauerlein and Mr. Link, and (v) for each named executive officer, all unvested equity or equity-based awards that vest solely based on the named executive officer’s continued employment or service with the Company will accelerate and vest in respect of 100% of the shares subject thereto.
2023 Summary Compensation Table
2023 Summary Compensation Table The following table sets forth all of the compensation awarded to or earned by or paid to our named executive officers during 2023 and 2022. The amounts set forth in the table have been calculated in accordance with the requirements of applicable SEC rules, and do not necessarily reflect the amounts that have actually been paid to, or which may be realized by, our named executive officers.
2023 Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | RSU Awards ($)(1) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($)(4) | Total (S) | | Paul Badawi President and Chief Executive Officer | 2023 | 610,000 | 1,727,148 | 1,303,282 | 243,207 | 18,385(5) | 3,902,022 | | | 2022 | 580,000 | 1,538,256 | 3,291,070 | 340,298 | — | 5,749,624 | | Alison Bauerlein(6) Chief Financial Officer | 2023 | 306,185 | 1,040,300 | 429,285 | 67,820 | 4,593 | 1,848,183 | | Matthew Link(7) Chief Commercial Officer | 2023 | 127,468 | 1,539,998 | 660,038 | 28,234 | 1,912 | 2,357,650 |
2023 Summary Compensation Table
| (1) Amounts reflect the grant date fair value of RSUs granted during the year computed in accordance with ASC Topic 718. |
2023 Summary Compensation Table
| (2) Amounts reflect the grant date fair value of stock options granted during the year computed in accordance with ASC Topic 718. We provide information regarding the assumptions used to calculate the value of stock options in Note 11 to the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Annual Report”). |
2023 Summary Compensation Table
| (3) Amounts represent bonuses earned by our named executive officers under our annual cash incentive program. Refer to “— Annual Cash Incentive Compensation” above for additional information regarding the 2023 annual cash incentive program. |
2023 Summary Compensation Table
| (4) Except as otherwise noted, amounts in this column represent matching contributions made by the Company to the named executive officers under the 401(k) plan. |
2023 Summary Compensation Table
| (5) Includes the costs associated with Mr. Badawi’s attendance at a Company sales event, including the related tax gross-up reimbursement ($12,470). The same reimbursement methodology was applied to all Company employees who attended the event. |
2023 Summary Compensation Table
| (6) Ms. Bauerlein commenced employment with us on April 3, 2023. The base salary amount represents the pro-rated portion of her annual base salary ($410,000) for the period from commencement of her employment through December 31, 2023. |
2023 Summary Compensation Table
| (7) Mr. Link commenced employment with us on September 11, 2023. The base salary amount represents the pro-rated portion of his annual base salary ($410,000) for the period from commencement of his employment through December 31, 2023. |
Outstanding Equity Awards at 2023 Fiscal Year-End
Outstanding Equity Awards at 2023 Fiscal Year-End The following table provides information about stock options and RSUs held by each of our named executive officers as of December 31, 2023.
Outstanding Equity Awards at 2023 Fiscal Year-End
| | Stock Option Awards | | | | Stock Awards | | | | | Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of RSUs That Have Not Yet Vested (#) | Market Value of RSUs That Have Not Yet Vested ($) | Equity Incentive Plan Awards; Number of Unearned Shares, Units, or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards; Market or Payout Value of Unearned Shares, Units, or Other Rights That Have Not Vested | | Paul Badawi | 419,790 | 230,210(1) | 10.96 | 5/24/2031 | 65,850(2) | 339,786 | | | | | 37,944 | 20,809(1) | 24.00 | 7/13/2031 | 176,600(5) | 911,256 | | | | | 168,331 | 182,969(2) | 17.52 | 2/8/2032 | | | | | | | 51,722 | 173,978(3) | 9.78 | 3/16/2033 | | | | | | Alison Bauerlein | — | 71,800(6) | 10.10 | 5/9/2033 | 103,000(8) | 531,480 | | | | Matthew Link | — | 526,430(7) | 2.06 | 11/13/2033 | 747,572(9) | 3,857,472 | — | — |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (1) This stock option vests in 48 equal monthly installments following the vesting commencement date of May 24, 2021, subject to the executive’s continued service to us through the applicable vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (2) This stock option vests in 48 equal monthly installments following the vesting commencement date of January 1, 2022, subject to the executive’s continued service to us through the applicable vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (3) This stock option vests in 48 equal monthly installments following the vesting commencement date of January 1, 2023, subject to the executive’s continued service to us through the applicable vesting date. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (4) These RSUs vest as to 25% of the underlying shares on each of January 1, 2023; January 1, 2024; January 1, 2025; and January 1, 2026, subject to the executive’s continued service to us through the applicable vesting dates. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (5) These RSUs vest as to 25% of the underlying shares on each of January 1, 2024; January 1, 2025; January 1, 2026; and January 1, 2027, subject to the executive’s continued service to us through the applicable vesting dates. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (6) This stock option vests as to 25% of the underlying shares on the first anniversary of the vesting commencement date of April 3, 2023, and in 36 equal monthly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (7) This stock option vests as to 25% of the underlying shares on the first anniversary of the vesting commencement date of September 11, 2023, and in 36 equal monthly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (8) These RSUs vest as to 25% of the underlying shares on each anniversary of the vesting commencement date of April 3, 2023, subject to the executive’s continued service to us through the applicable vesting dates. |
Outstanding Equity Awards at 2023 Fiscal Year-End
| (9) These RSUs vest as to 25% of the underlying shares on each anniversary of the vesting commencement date of September 11, 2023, subject to the executive’s continued service to us through the applicable vesting dates. |
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION Under our non-employee director compensation program, each non-employee director receives the following amounts for their service to the Board:
DIRECTOR COMPENSATION
| • | upon the director’s initial election or appointment to the Board, a number of RSUs equal to $240,000 divided by the closing price of our common stock on the grant date; |
DIRECTOR COMPENSATION
| • | on the date of our annual meeting of stockholders, if the director has served on the Board for at least six months as of the date of the annual meeting, a number of RSUs equal to $120,000 divided by the closing price of our common stock on the grant date; and |
DIRECTOR COMPENSATION
| • | an annual director fee of $40,000 paid in cash. |
DIRECTOR COMPENSATION
In addition, if the director serves on a committee of the Board or in the other capacities stated below, the director will receive additional annual fees paid in cash as follows:
DIRECTOR COMPENSATION
| • | non-executive chairperson of the board, $37,500; |
DIRECTOR COMPENSATION
| • | lead independent director (if applicable), $25,000; |
DIRECTOR COMPENSATION
| • | chairperson of the audit committee, $20,000; |
DIRECTOR COMPENSATION
| • | audit committee member other than the chair, $10,000; |
DIRECTOR COMPENSATION
| • | chairperson of the compensation committee, $15,000; |
DIRECTOR COMPENSATION
| • | compensation committee member other than the chairperson, $7,500; |
DIRECTOR COMPENSATION
| • | chairperson of the nominating and governance committee, $10,000; |
DIRECTOR COMPENSATION
| • | nominating and governance committee member other than the chair, $5,000, |
DIRECTOR COMPENSATION
| • | chairperson of the commercial strategy committee, $12,000, and |
DIRECTOR COMPENSATION
| • | commercial strategy committee member other than the chair, $6,000. |
DIRECTOR COMPENSATION
Director fees are payable in arrears in quarterly installments not later than the fifteenth day following the final day of each calendar quarter and prorated for any portion of a quarter that a director is not serving as a non-employee director or a committee member on our board. RSUs granted upon a director’s initial election or appointment to the Board vest in three equal annual installments following the grant date. RSUs granted annually to directors vest in a single installment on the earlier of the date of the next annual meeting of stockholders or the first anniversary of the grant date. In addition, all unvested RSUs vest in full upon the occurrence of a change in control. Mr. Badawi, our President and Chief Executive Officer, and Dr. Badawi, our Chief Technology Officer, both served on our Board during 2023, but have not been included in the 2023 Director Compensation Table below because they did not receive any additional compensation for this service. Information regarding Mr. Badawi’s and Dr. Badawi’s compensation paid in 2023 is included in the 2023 Summary Compensation Table, the Outstanding Equity Awards at 2023 Fiscal Year-End Table, and the associated narrative disclosure above.
2023 Director Compensation Table
2023 Director Compensation Table The following table sets forth all compensation paid or awarded to our non-employee directors during fiscal year 2023. The amounts set forth in the table have been calculated in accordance with the requirements of applicable SEC rules, and do not necessarily reflect the amounts that have actually been paid to, or which may be realized by, our directors.
2023 Director Compensation Table
| Name | Fees Earned or Paid in Cash ($) | RSU Awards ($)(1) | Total ($) | | Brenda Becker | 47,328 | 120,000 | 167,328 | | Staffan Encrantz | 87,908 | 120,000 | 207,908 | | Tamara Fountain, M.D.(2) | 41,056 | 360,000 | 401,056 | | Mack Hicks(3) | 13,194 | — | 13,194 | | Catherine Mazzacco | 16,337 | 240,000 | 256,337 | | Erica Rogers | 62,303 | 120,000 | 182,303 | | Valeska Schroeder, Ph.D.(4) | 32,754 | — | 32,754 | | Donald Zurbay | 67,500 | 120,000 | 187,500 |
2023 Director Compensation Table
| (1) Amounts reflect the grant date fair value of the RSUs granted during the given year computed in accordance with ASC Topic 718. |
2023 Director Compensation Table
| (2) Dr. Fountain joined our Board in July 2022, but due to certain conflict of interest requirements arising out of her previous tenure as President of the America Academy of Ophthalmology, she declined compensation for her service as a director during 2022. Commencing January 1, 2023, Dr. Fountain became eligible to receive compensation pursuant to the terms of our non-employee director compensation program. |
2023 Director Compensation Table
| (3) Effective January 5, 2023, Mr. Hicks stepped down as a Class II Director and as a member of the Audit Committee. The RSUs granted to Mr. Hicks in 2022 remained unvested and were forfeited as a result of his departure. |
2023 Director Compensation Table
| (4) Dr. Schroeder’s term as a Class II Director and as a member of the Compensation Committee expired at our Annual Meeting of Stockholders held on June 8, 2023. |
Equity Incentive Awards Granted to Directors and Executive Officers
Equity Incentive Awards Granted to Directors and Executive Officers As of December 31, 2023, we have granted stock options and RSUs to certain of our directors and executive officers as more fully described in the sections titled “Executive Compensation” and “Director Compensation”.