DEF 14A of Benitec Biopharma Inc., Oct 20, 2023

DEF 14A of Benitec Biopharma Inc.

Filed Oct 20, 2023 · FY20230001193125-23-259531

Open on EDGAR

  1. OUR MANAGEMENT

    OUR MANAGEMENT The following table sets forth certain information regarding those individuals currently serving as our directors (or nominated to serve as a director) and executive officers as of October 11, 2023:

  2. OUR MANAGEMENT

    | Name | Age | Position | | Dr. Jerel Banks | 48 | Chief Executive Officer, Director | | Megan Boston | 51 | Executive Director, Director | | J. Kevin Buchi (1)(2)(3) | 68 | Director | | Peter Francis (1)(2)(3) | 67 | Director | | Edward Smith (1)(2)(3) | 52 | Director |

  3. OUR MANAGEMENT

    (1) Member of our Audit Committee. (2) Member of our Compensation Committee. (3) Member of our Nominating and Corporate Governance Committee. Dr. Jerel Banks has been a Director since October 2016, Chairman of our Board since October 2017 and Chief Executive Officer since June 2018. Dr. Banks was formerly the Chief Investment Officer of Nant Capital, LLC. Prior to joining Nant Capital, LLC, Dr. Banks served as vice president, portfolio manager and research analyst for the Franklin Biotechnology Discovery Fund at Franklin Templeton Investments from 2012 to 2015. Prior to his tenure at Franklin Templeton Investments, he worked as a biotechnology senior equity research analyst at Sectoral Asset Management from 2011 to 2012. From 2008 to 2011, Dr. Banks worked as a biotechnology equity research analyst at Apothecary Capital, the healthcare investment management team for the family investment office of the Bass Family of Fort Worth, Texas. Dr. Banks began his career in investment management as a healthcare equity research associate at Capital Research Company where he was a member of the equity research team from 2006 to 2008. Dr. Banks earned an M.D. from Brown University School of Medicine and a Ph.D. in Organic Chemistry from Brown University, and he holds an A.B. in Chemistry from Princeton University. Dr. Banks’ experience in the healthcare industry and finance provides valuable experience and guidance to the Board. Megan Boston has previously been Chief Executive Officer and Managing Director of several companies, including entities listed on the Australian Stock Exchange. With over 13 years of experience, Ms. Boston has been a director across a range of industries where she chaired company boards as well as board sub-committees particularly in the area of finance and risk management. Specifically, Ms. Boston has been a Director of Benitec since August 2016 and Executive Director since June 2018. From 2014 until joining Benitec, Ms. Boston was CEO of listed companies on the Australian Stock Exchange, Omni Market Tide Ltd and Rision Ltd. Previously, Ms. Boston held senior executive roles at various banking institutions in the area of risk and compliance, as well as working for PricewaterhouseCoopers. Ms. Boston holds a Bachelor of Commerce and is an Australian Chartered Accountant. Ms. Boston has also completed the company directors course diploma administered by the Australian Institute of Company Directors. We believe Ms. Boston’s operational and financial infrastructure experience gives her the necessary skills and qualifications to serve as a member of the Board. J. Kevin Buchi has been a Director since April 2013. Mr. Buchi previously served as Chief Executive Officer of BioSpecifics Technologies Corp. and of TetraLogic Pharmaceuticals Corporation. Mr. Buchi served as Chief Executive Officer of Cephalon, Inc., or Cephalon, from December 2010 through its acquisition by Teva Pharmaceutical Industries Ltd in October 2011. After the acquisition Mr. Buchi served as Corporate Vice President, Global Branded Products of Teva Pharmaceuticals Industries Ltd. Mr. Buchi joined Cephalon in 1991 and held various positions, including Chief Operating Officer, from January 2010 to December 2010, Chief Financial Officer and Head of Business Development prior to being appointed Chief Executive Officer. Mr. Buchi is also on the board of directors of Amneal Pharmaceuticals, Inc. (NYSE: AMRX) and Novo Nordisk (NYSE:NVO), formerly Dicerna Pharmaceuticals, Inc. and Ampio Pharmaceuticals (NYSE:AMPE). Mr. Buchi has a B.A. in chemistry from Cornell University and a Masters in Management from Kellogg Graduate School of Management at Northwestern University. He is also a Certified Public Accountant. Based on his broad executive experience in the biotechnology industry, we believe Mr. Buchi has the appropriate skills and qualifications to serve on the Board. Peter Francis has been a director since February 2006 and was previously Chairman of the Board until October 2017. Since 1993, Mr. Francis has been a partner at Francis Abourizk Lightowlers, a firm of commercial and technology lawyers with offices in Melbourne, Australia. He is a legal specialist in the areas of intellectual property and licensing and provides legal advice to corporations and research bodies. Mr. Francis completed his studies in law and jurisprudence at Monash University. Based on his substantive intellectual property background and experience with our company, we believe Mr. Francis has the appropriate skills and qualifications to serve on the Board. Edward Smith has been a director since April 2020. Edward brings more than 20 years of experience in executive finance and operations leadership in the biotechnology industry to our Board. Edward presently serves as Chief Financial Officer of Reunion Neuroscience, a private, clinical stage pharmaceutical company focused on developing novel therapeutics for depressive disorders. Prior to that, he served as Chief Financial Officer and took public LAVA Therapeutics N.V. (Nasdaq: LVTX), a clinical stage pharmaceutical company focused on developing novel immuno-oncology therapeutics, and prior to that served as Chief Financial Officer at Marinus Pharmaceuticals, Inc. (Nasdaq: MRNS), a clinical-stage pharmaceutical company focused on developing and commercializing innovative therapeutics to treat patients suffering from rare seizure disorders and of PolyMedix, Inc. (Nasdaq: PYMX), a clinical stage pharmaceutical company focused on developing a novel class of antibiotics for the treatment of infectious diseases. Prior to that, he was executive director of finance at InKine Pharmaceutical Company, Inc. (Nasdaq: PYMX), where he assisted with its acquisition by Salix Pharmaceuticals, Inc. Earlier in his career, he held various positions in public accounting, most recently in the audit practice at Deloitte. Based on his extensive finance and operations background in the biotechnology industry, we believe Mr. Smith has the appropriate skill and qualifications to serve on the Board. There are no family relationships among any of our directors or executive officers and no existing arrangements or understandings with major stockholders, customers, suppliers or others pursuant to which any of our directors or members of senior management was selected as such. The business addresses for each of our directors and executive officers is 3940 Trust Way, Hayward, California 94545.

  4. CORPORATE GOVERNANCE AND BOARD MEETINGS AND COMMITTEES

    CORPORATE GOVERNANCE AND BOARD MEETINGS AND COMMITTEES The Company’s business and affairs are managed under the direction of the Board. The Board currently consists of five directors, comprising the Company’s Chief Executive Officer, Executive Director and three outside directors. Our Board has determined that three of our directors are independent as defined by the rules of the SEC and The Nasdaq Stock Market LLC (“Nasdaq”). Our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee each consists entirely of independent directors under the rules of the SEC and Nasdaq. The number of directors is fixed from time to time by resolution of the Board pursuant to the Company’s amended and restated certificate of incorporation (the “Certificate of Incorporation”). Each of the Company’s current directors will continue to serve as a director until the election and qualification of his or her successor, or until his or her earlier death, resignation, or removal. The Company’s Certificate of Incorporation provides that the Board is divided into three classes with staggered three-year terms. Only one class of directors is elected at each annual meeting of stockholders, with the other classes continuing for the remainder of their respective terms. The Board is designated as follows:

  5. CORPORATE GOVERNANCE AND BOARD MEETINGS AND COMMITTEES

    | • | Mr. Smith is a Class I director, and his current term will expire at the 2023 Annual Meeting; |

  6. CORPORATE GOVERNANCE AND BOARD MEETINGS AND COMMITTEES

    | • | Messrs. Buchi and Francis are Class II directors, and their current terms will expire at the annual meeting of stockholders to be held in 2024; and |

  7. CORPORATE GOVERNANCE AND BOARD MEETINGS AND COMMITTEES

    | • | Dr. Banks and Ms. Boston are Class III directors, and their current terms will expire at the annual meeting of stockholders to be held in 2025. |

  8. CORPORATE GOVERNANCE AND BOARD MEETINGS AND COMMITTEES

    Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the Company’s directors.

  9. Board of Directors

    Board of Directors Our Board held a total of eight meetings during the last fiscal year. Our Board has three standing committees — an Audit Committee established in accordance with section 3(a)(58)(A) of the Securities Exchange Act of 1934 (our “Audit Committee”), a Compensation Committee (our “Compensation Committee”) and a Nominating and Corporate Governance Committee (our “Nominating Committee”). Our Audit Committee, Compensation Committee and Nominating Committee each have a charter, which is available at the “Corporate Governance” section under the “For Investors” tab on our website at www.benitec.com.

  10. EXECUTIVE COMPENSATION

    EXECUTIVE COMPENSATION As a “smaller reporting company” we have opted to comply with the scaled executive compensation disclosure rules applicable to “smaller reporting companies” (as such term is defined under applicable securities laws). Our named executive officers, or our “NEOs”, for the fiscal year ended June 30, 2023 were Dr. Jerel A. Banks, our Executive Chairman and Chief Executive Officer, and Megan Boston, our Executive Director. The Company’s named executive officer compensation program is designed to incentivize our named executive officers to grow our business and further link the interests of our named executive officers with our stockholders. We provide our named executive officers with an annual base salary as a fixed, stable form of compensation, certain cash incentive opportunities as noted below to reward achievement of short-term goals, and, in prior fiscal years, we have granted our named executive officers stock options with multi-year vesting schedules to further align their compensation with our stockholders’ long-term interests. We have also entered into employment agreements with our named executive officers that provide for a fixed notice period in connection with certain terminations of employment. The employment agreements and our named executive officer compensation program generally are described in greater detail below under the heading “Narrative Disclosure to Summary Compensation Table”. Our Compensation Committee reviews our named executive officers’ overall compensation packages to help ensure that we continue to attract and retain highly talented executives and provide appropriate incentive to create additional value for our stockholders. The discussion of our compensation program prior to the completion of the re-domiciliation of Benitec Limited (“Limited”), resulting in the Company becoming the ultimate parent company of the Benitec group of companies (the “Re-Domiciliation”) reflects the compensation program of Limited, and of the Company for periods following the completion of the Re-Domiciliation. This discussion may contain forward-looking statements that are based on our current plans, considerations, expectations and determinations regarding future compensation programs.

  11. Summary Compensation Table

    Summary Compensation Table The following table sets forth information regarding compensation earned by our NEOs during the fiscal year ended June 30, 2023 and the fiscal year ended June 30, 2022:

  12. Summary Compensation Table

    | Named Executive Officer and Principal Position | Fiscal Year | Salary ($)(1) | Bonus ($)(2) | Option Awards ($)(3) | All Other Compensation ($) | Total ($) | | Dr. Jerel A. Banks, M.D. Ph.D. | 2023 | 539,500 | 273,000 | 70,657 | 35,568(5) | 918,725 | | Executive Chairman and Chief Executive Officer | 2022 | 505,682 | 260,000 | — | 34,282(5) | 799,964 | | Megan Boston | 2023 | 303,733 | 116,928 | 30,289 | 18,507(6) | 469,457 | | Executive Director | 2022 | 309,382 | 127,020(4) | — | 20,074(6) | 456,476 |

  13. Summary Compensation Table

    | (1) Ms. Boston’s salary was paid in Australian dollars and has been converted to U.S. dollars using a conversion rate of A$1.00 to $0.673, and A$1.00 to $0.73, for the fiscal years ended June 30, 2023 and June 30, 2022, respectively. From July 1, 2022 through September 30, 2022, Dr. Banks’s and Ms. Boston’s salary was $520,000 and $333,427.50 (Ms. Boston’s salary was converted using a conversion rate of A$1.00 to $0.73), respectively. As of October 1, 2022, Dr. Banks’s and Ms. Boston’s annual base salary rate was increased to $546,000 and $A456,750 ($333,427.50, converted using a conversion rate of A$1.00 to $0.73), respectively. As of October 1, 2023, Dr. Banks’s and Ms. Boston’s annual base salary rate was increased to $655,200 and A$548,100 ($350,784, converted using a conversion rate of A$1.00 to $0.64), respectively. |

  14. Summary Compensation Table

    | (2) Reflects discretionary bonuses paid to Dr. Banks and Ms. Boston in connection with their performance during the fiscal years ending June 30, 2023 and June 30, 2022, respectively. |

  15. Summary Compensation Table

    | (3) Amount represents the aggregate grant date fair value of stock and option awards granted by the Company in the fiscal year ended June 30, 2023, computed in accordance with FASB ASC Topic 718. For further information on how we account for stock-based compensation, see Note 10 to the Company’s consolidated financial statements for the year ended June 30, 2023, included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023 (the “Annual Report”). These amounts reflect the Company’s accounting expense for these awards and do not correspond to the actual amounts, if any, that will be recognized by the NEOs. |

  16. Summary Compensation Table

    | (4) Ms. Boston’s discretionary annual bonus was paid in Australian dollars and has been converted to U.S. dollars using a conversion rate of A$1.00 to $0.64 and A$1.00 to $0.73, for the fiscal years ended June 30, 2023 and June 30, 2022, respectively. |

  17. Summary Compensation Table

    | (5) Amounts reflect company-paid health and life insurance premiums. |

  18. Summary Compensation Table

    | (6) Amounts reflect the Company’s compulsory contributions to Ms. Boston’s superannuation account. The superannuation contributions were paid in Australian dollars and were converted to U.S. dollars using a conversion rate of A$1.00 to $0.673 and A$1.00 to $0.73, for the fiscal years ended June 30, 2023 and June 30, 2022, respectively. |

  19. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table sets forth information regarding outstanding equity or equity-linked awards for each of our NEOs as of June 30, 2023. All amounts are reflective of the Reverse Stock Split.

  20. Outstanding Equity Awards at Fiscal Year-End

    | | | Option Awards | | | | | Named Executive Officer | Grant Date | Number of Securities Underlying Unexercised Options (#)— Exercisable | Number of Securities Underlying Unexercised Options (#)— Unexercisable | Option Exercise Price ($) | Option Expiration Date | | Dr. Jerel A. Banks, M.D. Ph.D. | 6/13/2023(1)(2) | — | 20,994 | 3.91 | 6/13/2033 | | Executive Chairman and Chief Executive Officer | 12/9/2020(1)(2) | 11,150 | 5,576 | 50.66 | 12/9/2030 | | Megan Boston | 6/13/2023(1)(2) | — | 9,000 | 3.91 | 6/13/2033 | | Executive Director | 12/9/2020(1)(2) | 5,575 | 2,788 | 50.66 | 12/9/2030 | | | 3/12/2019(2)(3) | 980 | — | 721.99 | 3/12/2024 |

  21. Outstanding Equity Awards at Fiscal Year-End

    | (1) The option awards were granted under the 2020 Plan. |

  22. Outstanding Equity Awards at Fiscal Year-End

    | (2) The shares subject to each of the option awards vest in substantially equal installments on each of the first, second and third anniversaries of the grant date, generally subject to continued employment through the applicable vesting date. |

  23. Outstanding Equity Awards at Fiscal Year-End

    | (3) The option awards were granted under the Benitec Officers’ and Employees’ Share Option Plan prior to the Re-Domiciliation (the “Share Option Plan”). The share amounts and exercise prices of the awards shown in this table have been adjusted to reflect the terms of the Re-Domiciliation. |

  24. Termination or Change in Control Benefits

    Termination or Change in Control Benefits The employment agreements with our NEOs provide for specified notice periods (or pay in lieu of notice) if the Company terminates the employment of our NEOs under certain circumstances, as described above in the “Employment Agreements with our NEOs” section. Upon the consummation of a Change in Control (as defined in the 2020 Plan), all unvested stock options granted pursuant to the 2020 Plan will immediately vest as of immediately prior to the Change in Control. Our NEOs are not eligible to receive any additional payments or benefits in connection with their termination of employment or in connection with the Company’s change in control.

  25. Pay Versus Performance Disclosure

    Pay Versus Performance Disclosure As required by Item 402(v) of Regulation S-K, which was mandated by Section 953(a) of the Dodd-Frank Act (as defined below), we are providing the following information about the relationship between “compensation actually paid” to our principal executive officer (“PEO”) and average “compensation actually paid” (“CAP”) to each of our NEOs and the financial performance of the Company for the Company’s fiscal years ended June 30, 2023 (“Fiscal 2023”) a nd Jun e 30, 2022 (“Fiscal 2022”), in each case calculated in a manner consistent with SEC rules.

  26. Pay Versus Performance Disclosure

    | Year | Summary Compensation Table Total for PEO(1) | Compensation Actually Paid to PEO(1)(2) | Average Summary Compensation Table Total for Non-PEO NEOs(2)(3) | Average Compensation Actually Paid to Non-PEO NEOs(2)(3) | Value of Initial Fixed $100 Investment Based On(4): Total Shareholder Return | Net Income (loss) (in thousands) | | 2023 | $918,725 | $701,866 | $469,457 | $360,893 | $(79.44) | $(14,901) | | 2022 | $799,964 | $(176,698) | $456,476 | $(39,270) | $(71.36) | $(18,208) |

  27. Pay Versus Performance Disclosure

    | (1) The PEO reflected in these columns for Fiscal 2023 and Fiscal 2022 is Dr. Jerel A. Banks, M.D. Ph.D. |

  28. Pay Versus Performance Disclosure

    | (2) CAP to our PEO and Non-PEO NEO (Megan Boston, our Executive Director) is calculated based on the “Total Compensation” reported in the Summary Compensation Table (“SCT”) for each of the applicable fiscal years, adjusted to exclude and include certain items in accordance with Item 402(v) of Regulation S-K as follows. Portions of Ms. Boston’s compensation were paid in Australian dollars and have been converted to U.S. dollars using the applicable conversion rates set forth in footnotes 1 and 4 to the SCT. |

  29. Pay Versus Performance Disclosure

    PEO SCT Total to CAP Reconciliation:

  30. Pay Versus Performance Disclosure

    | Fiscal Year | SCT Total | Deductions from SCT Total(i) | Additions to SCT Total(ii) | | | CAP | | | | | Fair Value of Current Year Equity Awards for Fiscal Year 2023 | Change in Value of Prior Years’ Awards Unvested for Fiscal Year 2023 | Change in Value of Prior Years’ Awards that Vested in Fiscal Year 2023 | | | 2023 | $918,725 | $70,657 | $74,271 | $(230,188) | $9,715 | $701,866 | | 2022 | $799,964 | $0 | $0 | $(867,266) | $(109,396) | $(176,698) |

  31. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION The following table shows the total compensation paid to the Company’s directors (other than any such directors who are also NEOs) for the fiscal year ended June 30, 2023.

  32. DIRECTOR COMPENSATION

    | Name | Fees Earned or Paid in Cash ($)(2) | Option Awards ($)(3) | All Other Compensation ($)(4) | Total ($) | | J. Kevin Buchi | 64,000 | 1,777 | — | 65,777 | | Peter Francis | 60,066 | 1,777 | 5,460 | 67,303 | | Edward F. Smith | 61,208 | 1,777 | — | 62,985 |

  33. DIRECTOR COMPENSATION

    | (1) For information regarding the compensation of Dr. Banks and Ms. Boston, see “Summary Compensation Table.” |

  34. DIRECTOR COMPENSATION

    | (2) Fees paid to Mr. Francis were paid in Australian dollars and have been converted to U.S. dollars using a conversion rate of A$1.00 to $0.673 for the fiscal year ended June 30, 2023. |

  35. DIRECTOR COMPENSATION

    | (3) Amount represents the aggregate grant date fair value of stock and option awards granted by the Company in the fiscal year ended June 30, 2023, computed in accordance with FASB ASC Topic 718. For further information on how we account for stock-based compensation, see Note 10 to the Company’s consolidated financial statements for the year ended June 30, 2023 included in the Annual Report. These amounts reflect the Company’s accounting expense for these awards and do not correspond to the actual amounts, if any, that will be recognized by the directors. |

  36. DIRECTOR COMPENSATION

    | (4) For information regarding other compensation of all directors, see “Narrative Disclosure to Director Compensation Table.” |

  37. DIRECTOR COMPENSATION

    For each director, the aggregate number of option awards outstanding at fiscal year-end for the fiscal year ended June 30, 2023 is set forth below. All amounts below are reflective of the Reverse Stock Split:

  38. DIRECTOR COMPENSATION

    | Name | Option Awards (#) | | J. Kevin Buchi | 2,798 | | Peter Francis | 2,798 | | Edward F. Smith | 2,798 |

  39. Narrative Disclosure to Director Compensation Table

    Narrative Disclosure to Director Compensation Table Upon their appointment as executive officers and employees, Dr. Banks and Ms. Boston no longer receive annual fees with respect to their service on the Board. The annual fees for the fiscal year ended June 30, 2023 paid to our non-employee directors were:

  40. Narrative Disclosure to Director Compensation Table

    | • | an annual cash retainer of $40,000; |

  41. Narrative Disclosure to Director Compensation Table

    | • | an additional annual cash retainer of $15,000 to the chair of the Audit Committee; |

  42. Narrative Disclosure to Director Compensation Table

    | • | an additional annual cash retainer of $10,000 to the chair of the Compensation Committee; |

  43. Narrative Disclosure to Director Compensation Table

    | • | an additional annual cash retainer of $7,500 to the chair of the Nominating Committee; |

  44. Narrative Disclosure to Director Compensation Table

    | • | an additional annual cash retainer of $7,500 to a non-chair member of the Audit Committee; |

  45. Narrative Disclosure to Director Compensation Table

    | • | an additional annual cash retainer of $5,000 to a non-chair member of the Compensation Committee; and |

  46. Narrative Disclosure to Director Compensation Table

    | • | an additional annual cash retainer of $4,000 to a non-chair member of the Nominating Committee. |

  47. Narrative Disclosure to Director Compensation Table

    In addition to the cash fees paid to our non-employee directors, the Board granted each of Messrs. Buchi, Francis and Smith seven hundred five (705) option awards (reflective of the Reverse Stock Split) on December 7, 2022. The option awards vest in three substantially equal installments on the day prior to each of the Company’s next three annual stockholder meetings occurring immediately following December 7, 2022. In addition, the Company makes a superannuation contribution on Mr. Francis’ behalf in the amount of $5,460.

  48. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS Our Board currently consists of five directors divided into three classes — Class I (Mr. Smith), Class II (Mr. Buchi and Mr. Francis) and Class III (Dr. Banks and Ms. Boston) — with the directors in each class holding office for staggered terms of three years each or until their successors have been duly elected and qualified. Mr. Smith’s term expires at the Annual Meeting. Accordingly, one Class I director will be elected at the Annual Meeting. The nominee for election as the Class I director is Mr. Smith. The Class I director will serve until our 2026 Annual Meeting of Stockholders and until his successor is elected and qualified. Assuming the nominee is elected, we will have five directors serving as follows:

  49. ELECTION OF DIRECTORS

    | Class I director: Edward Smith | Term expires at our 2026 annual meeting of stockholders. | | Class II directors: J. Kevin Buchi and Peter Francis | Terms expire at our 2024 annual meeting of stockholders. | | Class III directors: Dr. Jerel Banks and Megan Boston | Terms expire at our 2025 annual meeting of stockholders. |

  50. ELECTION OF DIRECTORS

    The accompanying proxy card grants the proxy holder the power to vote the proxy for a substitute nominee in the event that the nominee becomes unavailable to serve as a Class I director. Management presently has no knowledge that the nominee will refuse or be unable to serve as a Class I director for his prescribed term.

  51. Director Nominee: Edward Smith

    Director Nominee: Edward Smith See above under “Our Management” for the biographical information of Mr. Smith.

  52. Maximum Shares Reserved

    | • | Shares of common stock and stock equivalents repurchased with any cash proceeds from option exercises are not added back to the shares available for grant under the Amended Plan. |