DEF 14A of Anavex Life Sciences Corp.
Filed May 6, 2024 · FY20230001731122-24-000730
PROPOSAL 1 – ELECTION OF DIRECTORS
PROPOSAL 1 – ELECTION OF DIRECTORS
General
General At the 2024 Meeting, a board of six directors will be elected, each to hold office until the succeeding annual meeting of stockholders or until such director’s successor shall have been duly elected and qualified (or, if earlier, such director’s removal or resignation from our Board). All of the director nominees are incumbent directors. Information concerning all director nominees appears below. Management does not anticipate that any of the persons named below will be unable or unwilling to stand for election.
Information Concerning Director Nominees
Information Concerning Director Nominees
Information Concerning Director Nominees
| Skills and Experience | Christopher Missling, PhD | Jiong Ma, PhD | Claus van der Velden, PhD | Athanasios Skarpelos | Steffen Thomas, PhD | Peter Donhauser, D.O. | | Independent Director | | X | X | X | X | X | | International Background | X | | X | X | X | X | | Healthcare Industry Experience | X | | | | | X | | Financial Expert* | X | | X | | | | | IT Security and Cybersecurity Experience | | X | X | | | | | Intellectual Property Law Expert | | | | | X | | | Public Company directorship experience | | X | | X | | |
Information Concerning Director Nominees
*as defined by applicable SEC and NASDAQ rules Background information about the Board’s nominees for election, as well as information regarding additional experience, qualifications, attributes or skills that led the Board to conclude that the nominee should serve on the Board, is set forth below: Christopher Missling, PhD. Christopher Missling, age 58, has over twenty years of healthcare industry experience in big pharmaceutical, biotech and investment banking. Most recently, from March 2007 until his appointment by our Company, Dr. Missling served as the head of healthcare investment banking at Brimberg & Co. in New York, New York. In addition, Dr. Missling served as the Chief Financial Officer of Curis, Inc. (NASDAQ: CRIS) and ImmunoGen, Inc. (NASDAQ: IMGN). Dr. Missling earned his MS and PhD from the University of Munich and an MBA from Northwestern University Kellogg School of Management and WHU Otto Beisheim School of Management. Dr. Missling has served as President, Chief Executive Officer and Director for the Company since July 2013. Jiong Ma, PhD. Jiong Ma, age 60, has over 25 years of experience in investing, building, scaling of companies with focus on innovative product launches in digital health, technology and the new energy transition. Dr. Ma currently serves on the board of SES AI Corporation (NYSE: SES), and LinkinVax, a biotech company spin-off from the Vaccine Research Institute in France. Dr. Ma served as senior partner and a member of the investment committee at Braemar Energy Ventures (“Braemar”). While at Braemar, Dr. Ma led investments in more than 15 companies involved in either resource efficiency, e-mobility, industrial digitalization, renewable energy, or deep tech, and has achieved multiple successful exits through M&A and IPO. Dr. Ma has significant knowledge and expertise in the technology industry, including information security. Prior to Braemar Energy Ventures, she was with the Venture Capital Group at 3i Group, a global private equity firm, where she led investments across multiple stages in Digital Health, TMT and Cleantech. Preceding the Venture Capital Group at 3i, Dr. Ma held several senior positions at Lucent Technologies and Bell Labs. Her responsibilities included lead roles in product portfolio strategy, new product launches for Optical and Data Networking, and research and product development. Dr. Ma was also a founding team member of Onetta Inc., a fiber networks company. She has a PhD in Electrical and Computer Engineering from the University Colorado at Boulder and an MS in Electrical Engineering from Worcester Polytechnic Institute. Dr. Ma is a Kauffman Fellow. Dr. Ma has served on the Board since May 2021. Claus van der Velden, PhD. Claus van der Velden, PhD, age 51, brings significant expertise in management, accounting, internal controls, information security and risk management. Since May 2021, he has served as Managing Director (Chief Financial Officer) of NetCologne GmbH, a regional telecommunication provider in Germany. From July 2011 to May 2021, he served as corporate head of Management Accounting, Internal Audit and Risk Management at Stroeer SE & Co KGaA, a publicly listed German digital media company. As the prior head of internal audit at Stroeer SE & Co KGaA, Dr. van der Velden has experience in the area of information security risk assessment, and the internal control tools, processes, and policies needed to counter information security threats. Previously, Dr. van der Velden served as the Director of Corporate Business Controlling for the Nutrition & Health business unit at Cognis, a worldwide supplier of global nutritional ingredients and specialty chemicals. In this position, he was also a compliance representative and a member of the global leadership team. After the acquisition of Cognis by BASF, he was responsible for the management accounting processes of the BASF Nutrition & Health division, developing and producing mostly natural-source ingredients for the food and healthcare industries. Dr. van der Velden started his career as a strategy consultant at an international marketing and strategy consultancy firm. He studied in Kiel and Stockholm and received a degree in economics from the University of Kiel and later obtained his doctorate in business management from the WHU-Otto Beisheim School of Management where he also previously taught economics. Dr. van der Velden has served on the Board since March 2018. Athanasios Skarpelos. Athanasios (Tom) Skarpelos, age 57, is a self-employed investor with over 20 years of experience working with private and public companies with a focus on biotechnology companies involved in drug discovery and drug development projects. His experience has led to relationships with researchers at academic institutes in Europe and North America. Mr. Skarpelos is a founder of Anavex. Mr. Skarpelos has served on the Board since January 2013. Steffen Thomas, PhD. Steffen Thomas, age 58, has over 15 years of experience as a European patent attorney and is currently practicing at Epping Hermann Fischer, a major intellectual property law firm in Europe. Previously, he worked for Japan-based Takeda Pharmaceutical Company, the largest pharmaceutical company in Asia and a top firm worldwide, as an in-house patent attorney. Prior to that, he worked for Nycomed Pharma, acquired by Takeda in 2011 for approximately USD $10 billion. Dr. Thomas’ legal practice covers drafting of patent applications, prosecuting patent applications before national and international patent offices, defending and challenging patents in opposition, appeal, and nullity proceedings, enforcing patents before the infringement courts, and preparing opinions on patentability and infringement in the technical field of chemistry. Dr. Thomas has particular expertise in small molecule pharmaceuticals. He holds MS and PhD degrees in Chemistry from the University of Munich. Dr. Thomas has served on the Board since June 2015. Peter Donhauser, D.O., Peter Donhauser, age 58, had more than 20 years of expertise in clinical research prior to practicing osteopathic medicine with an integrated medical approach in private practice beginning in 2000. He worked at the University Hospital of Munich in the fields of geriatrics and neuromusculoskeletal diseases. During this time, he was a clinical trial investigator in multiple Phase 3 studies, including studies sponsored by Merck Sharp & Dohme, Merck, Boehringer Mannheim, Roche, Servier and Sanofi. He received his human medicine degree at the University of Munich and Doctor of Osteopathic Medicine (D.O.) from the German-American Academy for Osteopathy, or DAAO, a member of the European Register for Osteopathic Physicians, or EROP, at the Philadelphia College of Osteopathic Medicine. Dr. Donhauser has served on the Board since February 2017.
EXECUTIVE AND DIRECTOR COMPENSATION
EXECUTIVE AND DIRECTOR COMPENSATION
Compensation Consultants
Compensation Consultants The Compensation Committee makes recommendations to the Board regarding the compensation of our named executive officers, including the structure and design of the compensation programs. The Compensation Committee is responsible for retaining and terminating compensation consultants and determining the terms and conditions of their engagement. During fiscal 2023, the Compensation Committee did not engage any compensation consultants.
Annual Discretionary Cash Bonuses
Annual Discretionary Cash Bonuses The Company has an annual discretionary cash bonus program. We provide such bonuses to motivate executive officers to perform on behalf of general corporate goals and to perform in their areas of responsibility. The Compensation Committee our Board works with the Chief Executive Officer to evaluate the Company’s financial performance of the prior year, and overall financial condition of the Company to determine if discretionary bonuses are to be paid. In addition, on an annual basis, our Compensation Committee independently evaluates the performance of our Chief Executive Officer in the prior year, as well as the overall financial condition of the Company to determine if a discretionary bonus of up to 20% of base salary shall be paid to the Chief Executive Officer.
Equity Compensation
Equity Compensation Only our Board, acting in its sole discretion, or the Compensation Committee may grant stock options to our named executive officers. We view stock options as one of the more important components of our long-term, performance-based compensation philosophy. We provide stock options through initial grants at or near the date of hire and subsequent periodic/annual grants. Generally, initial stock option grants vest over a three-year period and have an exercise price equal to the fair market value of our stock at the time of grant. Initial grant amounts are based on ranges that take into consideration a named executive officer’s job responsibilities and competitive market data. We grant periodic additional stock options to reflect the individual’s ongoing contributions to the long-term success and growth of the Company, to incentivize individuals to remain with the Company and to provide a long-term incentive to achieve or exceed our corporate goals. We do not have a program, plan or practice to time stock option grants to our named executive officers in coordination with the release of material nonpublic information. We have not re-priced any of our stock options and do not intend to re-price or otherwise adjust outstanding stock options at any time in the future. Equity compensation includes stock option grants within the terms of our 2022 Omnibus Incentive Plan. Each named executive officer is eligible for stock option grants under the 2022 Omnibus Incentive Plans which may vest over a required service period, “Time Based Awards”, or upon achievement of certain performance criteria, “Performance Awards”. Generally, our Compensation Committee grants Time Based Awards at or near the date of hire. Such grants are intended to link compensation with stockholder value over time. Subsequent awards are generally granted as Performance Awards, which are intended to align compensation with the Company’s short-term and long-term objectives. Our Compensation Committee selects performance goals that reflect the Company’s short-term and longer-term objectives to ensure named executive officers are rewarded for the successful and timely accomplishment of these objectives. Generally, these performance criteria include milestones in connection with the successful execution and enrollment of the Company’s clinical trial programs. In March 2023, our Compensation Committee granted options to our Chief Executive Officer and Principal Financial Officer, which vest in four equal tranches based on four performance milestones including accomplishing (i) Publication of ANAVEX2-73-AD-004 Alzheimer’s disease clinical trial data, (ii) Completion of enrollment of ANAVEX2-73 PET imaging Parkinson’s disease Phase 2 clinical trial, (iii) Completion of ANAVEX2-73 Parkinson’s disease Phase 2b/3 clinical trial and (iv) Completion of enrollment of ANAVEX3-71 Phase 2 clinical trial in Schizophrenia.
Clawback Policy
Clawback Policy In November 2023, the Board adopted an executive officer compensation clawback policy that may be applied in the event of a material financial restatement. The clawback policy covers all of the named executive officers and includes all incentive-based compensation. Specifically, in the event of an accounting restatement, the Company must recover, reasonably promptly, erroneously awarded compensation in amounts determined pursuant to the policy. Compensation that may be recoverable under the policy includes cash or equity-based compensation for which the grant, payment or vesting (or any portion thereof) is or was predicated upon the achievement of specified financial results that are impacted by the material financial restatement, and the amount of compensation that may be impacted by the clawback policy is the difference between the amount paid or granted, and the amount that should have been paid or granted, if calculated on the updated financials. Recovery under the policy with respect to an executive officer will not require the finding of any misconduct by such executive officer or such executive officer being found responsible for the accounting error leading to an accounting restatement. Our equity awards provide that the Company may annul an award if the grantee incurs a separation from service for “cause” (as defined in the agreements). In such case, all awards and any amounts or benefits received or outstanding shall be subject to cancellation, recoupment, rescission, payback and other action in accordance with the terms of the Company Clawback Policy or any applicable law. In addition, in the event of a restatement of the Company’s financial statements due to material noncompliance with any financial reporting requirement under the law, whether such noncompliance is the result of misconduct or other circumstances, an employee shall be required to reimburse the Company for any amounts earned or payable with respect to an award granted under the Company’s equity plan to the extent required by law and the Company’s clawback policy.
Summary Compensation
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Option Awards ($)(1) | All other Compensation ($)(2) | Total ($) | | Christopher Missling | 2023 | 700,000 | 124,753 | 3,066,200 | 3,500 | 3,894,453 | | President, Chief Executive | 2022 | 586,400 | 110,000 | 6,045,043 | 12,200 | 6,753,643 | | Officer and Director | 2021 | 550,000 | 110,000 | 8,745,457 | 11,600 | 9,417,057 | | Sandra Boenisch(3) | 2023 | 186,883 | — | 306,700 | 7,475 | 501,058 | | Principal Financial | 2022 | 174,900 | — | 277,603 | — | 452,503 | | Officer and Treasurer | 2021 | 158,300 | — | 724,314 | — | 882,614 |
Grants of Plan-Based Awards
Grants of Plan-Based Awards The following table sets forth the awards granted for each named executive officer during the year ended September 30, 2023 under our 2022 Omnibus Incentive Plan:
Grants of Plan-Based Awards
| | | Estimated future payouts under non-equity incentive plan awards(1) | | | Estimated Future Payouts under Equity Incentive Plan Awards(2) | | | | | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | Exercise or base price of option award ($/sh) | Grant date fair value of option awards ($) (3) | | Christopher Missling | March 31, 2023 | — | 124,753 | 124,753 | — | 500,000 | 500,000 | 8.57 | 3,066,200 | | Sandra Boenisch | March 31, 2023 | — | — | — | — | 50,000 | 50,000 | 8.57 | 306,700 |
Grants of Plan-Based Awards
(1) Amounts reported represent the potential short-term incentive compensation amounts payable in the 2023 fiscal year under our annual cash incentive program. The amounts reported represent each executive officer’s target and maximum possible payments for 2023. Because actual payments to the named executive officers could range from 0% to 100% of their target bonus, the threshold payment amount is $0. The actual short-term incentive bonus amount earned by each named executive officer for 2023 is reported in the Bonus column in the Summary Compensation Table above. (2) Represents shares of our common stock underlying options awarded. Amounts reported which are subject to performance-based vesting conditions, as described in the section “Elements of Executive Compensation – Equity Compensation” above (3)Represents the fair value of each equity award on the date of grant, as computed in accordance with FASB ASC 718.
Outstanding Equity Awards at Fiscal Year-End
Outstanding Equity Awards at Fiscal Year-End The following table sets forth for each named executive officer and director certain information concerning the outstanding equity awards as of September 30, 2023.
Outstanding Equity Awards at Fiscal Year-End
| Option Awards | | | | | | | Name | Number of Securities Underlying Exercisable Options (#) | Number of Securities Underlying Unexercisable Options (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | | Christopher | 73,380 | — | — | 1.32 | May 8, 2024 | | Missling | 500,000 | — | — | 0.92 | April 2, 2025 | | | 187,500 | — | — | 5.04 | Sept 18, 2025 | | | 379,625 | — | — | 6.26 | July 5, 2026 | | | 861,429 | — | — | 7.06 | July 18, 2026 | | | 500,000 | — | — | 3.28 | Sept 22, 2026 | | | 450,000 | — | — | 5.92 | May 12, 2027 | | | 400,000 | — | — | 3.30 | Dec 13, 2027 | | | 450,000 | — | — | 2.30 | May 15, 2028 | | | 409,500 | — | — | 2.58 | Oct. 1, 2028 | | | 750,000 | — | — | 3.15 | May 3, 2029 | | | 550,000 | — | — | 2.96 | January 6, 2030 | | | 550,000 | — | — | 5.49 | December 30, 2030 | | | — | — | 500,000 | 18.11 | August 2, 2031 | | | — | — | 500,000 | 7.54 | June 14, 2032 | | | — | — | 500,000 | 10.09 | June 27, 2032 | | | — | — | 500,000 | 8.57 | March 31, 2032 | | Sandra Boenisch | 30,000 | — | — | 3.30 | Dec 13, 2027 | | | 30,000 | — | — | 2.30 | May 15, 2028 | | | 27,300 | — | — | 2.58 | Oct. 1, 2028 | | | 35,000 | — | — | 2.93 | June 4, 2029 | | | 70,000 | — | — | 2.96 | January 6, 2030 | | | 50,000 | — | — | 5.49 | December 30, 2030 | | | — | — | 40,000 | 18.11 | August 2, 2031 | | | — | — | 40,000 | 10.09 | June 27, 2032 | | | — | — | 50,000 | 8.57 | March 31, 2032 |
Option Exercises and Stock Vested
Option Exercises and Stock Vested The following table sets forth for each named executive officer awards that were exercised during the year ended September 30, 2023:
Option Exercises and Stock Vested
| | Option Awards | | | Name | Number of shares acquired on exercise (#) | Value realized on exercise ($) | | Christopher Missling | 500,000 | 3,203,340 | | Sandra Boenisch | — | — |
Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans
Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans There was no nonqualified deferred compensation for our named executive officers in fiscal 2023.
CEO Pay Ratio Disclosure
CEO Pay Ratio Disclosure We are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of our CEO. Based on the information for fiscal year 2023, we reasonably estimate that the ratio of our CEO’s annual total compensation to the annual total compensation of our median employee was 7.7:1. Our pay ratio estimate has been calculated in a manner consistent with Item 402(u) of Regulation S-K using the data and assumptions summarized below. We identified the median employee by examining the 2023 annual base salary compensation for all individuals, excluding our CEO. We excluded independent contractors retained on an as needed basis, whose compensation is determined by an unaffiliated third party, and who are therefore are not considered our employees for purposes of the pay ratio calculation. We included all employees who were employed by us as of September 30, 2023. We selected the determination date and measurement period because they are recent periods for which employee census and compensation information are readily available. Salaries and wages were annualized for those employees who were not employed for the full year of fiscal 2023. We selected annual base salary as our compensation measure because it is readily available in our existing payroll systems, it is consistently calculated for each employee, and because it is a reasonable proxy for total compensation for purposes of determining the median employee. We did not apply any cost-of-living adjustments to the compensation of employees in jurisdictions other than the jurisdiction in which the CEO resides. Once we identified our median employee, we calculated such employee’s annual total compensation for 2023 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, resulting in that employee’s annual total compensation of $512,245. The median employee’s annual total compensation includes annualized base salary, annualized bonus, annualized 401(k) matching contributions, and the fair value of awards granted during the fiscal year ended September 30, 2023 under our 2022 Omnibus Incentive Plan. With respect to the CEO, we used the amount reported as total compensation in the Summary Compensation Table included in this proxy statement. Any estimates and assumptions used to calculate total annual compensation are described in footnotes to the Summary Compensation Table.
Pay Versus Performance
Pay Versus Performance The following table and supporting narrative contain information regarding “compensation actually paid” to our named executive officers and the relationship to Company performance.
Pay Versus Performance Table
Pay Versus Performance Table
Pay Versus Performance Table
| | | | Average | | Value of Initial Fixed | | | | | | | | Summary | Average | $100 Investment on | | | | | | | | Compensation | Compensation | September 30, 2020 | | | | | | | | Table Total | Actually Paid | | Peer Group | | | | | Summary | | for Non-PEO | to Non-PEO | | Total | | | | | Compensation | Compensation | Named | Named | Total | Shareholder | Net Income | Stock | | | Table Total | Actually Paid | Executive | Executive | Shareholder | Return ($) | (thousands) | Price | | Year | for PEO ($) (1) | to PEO ($) (1) | Officers ($) (2) | Officers ($) (2) | Return ($) | (3) | (4) | ($) (5) | | 2023 | $3,894,453 | $4,266,103 | $501,058 | $542,478 | $144 | $95 | $(47,505) | $6.55 | | 2022 | $6,753,643 | $259,400 | $452,503 | $(44,360) | $227 | $90 | $(47,978) | $10.32 | | 2021 | $9,417,057 | $25,756,400 | $882,614 | $2,512,063 | $395 | $120 | $(37,909) | $17.95 |
Pay Versus Performance Table
| (1) Reflects compensation for our Chief Executive Officer, Christopher Missling, who served as our Principal Executive Officer (PEO) in 2021, 2022 and 2023. |
Pay Versus Performance Table
| (2) Reflects compensation for Sandra Boenisch in 2021, 2022, and 2023. |
Pay Versus Performance Table
| (3) Peer Group used for TSR comparisons reflects the NASDAQ Biotechnology Index. |
Pay Versus Performance Table
| (4) Net Income (Loss) is the dollar amount reported in the Company’s audited consolidated financial statements for the applicable year. |
Pay Versus Performance Table
| (5) Pursuant to Item 402(v) of Regulation S-K, we determined our stock price to be the most important financial performance measure used to link Company performance to “Compensation Actually Paid” to our PEO and other named executive officers in 2023. Stock price reflects the close price on the last trading day of the fiscal year. |
Pay Versus Performance Table
To calculate “compensation actually paid” for our CEO and other named executive officers the following adjustments were made to Summary Compensation Table total pay.
Pay Versus Performance Table
| | PEO | | | Other Named Executive Officers | | | | Adjustments | 2023 | 2022 | 2021 | 2023 | 2022 | 2021 | | Summary Compensation Table Total | $3,894,453 | $6,753,643 | $9,417,057 | $501,058 | $452,503 | $882,614 | | Deduction for amount reported in “Options Awards” column of the Summary Compensation Table | $3,066,200 | $6,045,043 | $8,745,457 | $306,700 | $277,603 | $724,314 | | Addition of fair value at fiscal year (FY) end, of equity awards granted | $3,492,500 | $7,410,500 | $13,473,100 | $349,250 | $297,440 | $1,158,440 | | Addition of change in fair value at FY end versus prior FY end for awards granted in prior FY that remained outstanding | $(476,500) | $(5,989,700) | $9,659,850 | $(39,480) | $(516,700) | $855,890 | | Addition of change in fair value at vesting date versus prior FY end for awards granted in prior FY that vested during the FY | $421,850 | $(1,870,000) | $1,951,850 | $38,350 | — | $339,433 | | Compensation Actually Paid | $4,266,103 | $259,400 | $25,756,400 | $542,478 | $(44,360) | $2,512,063 |
Pay Versus Performance Table
“Compensation Actually Paid” reflects the exclusions and inclusions of equity awards for the PEO and the Non-PEO named executive officer and calculated in accordance with FASB ASC Topic 718 using the valuation methodologies and assumptions set forth in the calculation of the grant date fair value of these awards as disclosed in the Company’s audited financial statements for the fiscal year in which equity awards were granted.
Compensation Actually Paid Versus Company Performance
Compensation Actually Paid Versus Company Performance
Compensation of Directors
Compensation of Directors The table below shows the compensation of our directors who were not our named executive officers for the fiscal year ended September 30, 2023:
Compensation of Directors
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($) | Option Awards ($) (1) | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | | Athanasios Skarpelos | 25,000 | — | 316,540 | — | — | — | 341,540 | | Claus van der Velden | 41,000 | — | 316,540 | — | — | — | 357,540 | | Steffen Thomas | 25,000 | — | 316,540 | — | — | — | 341,540 | | Peter Donhauser | 25,000 | — | 316,540 | — | — | — | 341,540 | | Jiong Ma | 33,000 | — | 316,540 | — | — | — | 349,540 |
Compensation of Directors
(1) Includes stock option awards valued based on the aggregate grant date fair value of the award computed in accordance with FASB ASC Topic 718. The amounts shown in the table above do not necessarily reflect the actual value that may be realized by the non-employee director upon vesting. On September 30, 2023, the aggregate number of outstanding vested and unvested stock option awards held by each director was as follows: Mr. Skarpelos possessed options to purchase 355,500 shares, Dr. van der Velden possessed options to purchase 305,500 shares, Dr. Thomas possessed options to purchase 405,500 shares, Dr. Donhauser possessed options to purchase 305,500 shares and Dr. Ma possessed options to purchase 160,000 shares. We currently compensate non-employee directors $25,000 per year, paid quarterly. We compensate Dr. Ma an additional $4,000 per quarter for performing the functions of Chairman of the Board. We compensate Claus van der Velden an additional $4,000 per quarter for performing the functions of Chairman of our Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee. We regularly grant members of the Board awards of options. Each Board member is granted options initially when they join the Board, which options typically vest over a three-year period. Additionally, we grant awards on an annual basis. Annual awards of options typically vest in full on the first anniversary of grant date. In 2023, the annual grant was 50,000 options to each director. In addition, directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our Board. Our Board may award further special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director.
Potential Payments Upon Termination
Potential Payments Upon Termination The Company is a party to employment contracts with our Chief Executive Officer and Principal Financial Officer that contain provisions for payment of severance upon termination either by the Company without cause or by the employee for good reason. General terms of these arrangements are described below. Our CEO Employment Agreement with Dr. Missling contains provisions regarding our obligations upon his termination and upon a Change in Control. Any capitalized term not defined herein is used as defined in the CEO Employment Agreement. If Dr. Missling’s employment is terminated by us without Cause, he is entitled to receive payments by us consisting of (i) reimbursement of any unpaid business expenses to which he is entitled to reimbursement that were incurred prior to the effective date of his termination, (ii) all vested compensation and benefits to which he is entitled as of the Termination Date, (iii) a severance payment consisting of the three times the sum of (a) his annual salary in effect at the time of termination and (b) the average of the annual Bonuses payable to him for the last three completed calendar years prior to the Termination Date, (iv) all outstanding and unvested stock options and all options previously vested will become and remain exercisable for no less than three years from the Termination Date; (v) all of his unvested and outstanding restricted stock, restricted stock units or other equity awards that are unvested and outstanding as of the Termination Date shall vest and be settled within ten business days after the Termination Date, (vi) life insurance coverage until the end of the term of the CEO Employment Agreement; and (vii) continued participation in all medical, dental and hospitalization benefits plans or programs for Dr. Missling and his eligible dependents for 36 months or until he receives similar benefits at a new employer, at his sole cost. If Dr. Missling’s employment is terminated by him for Good Reason, he is entitled to receive the same as the above, however the severance payment will consist of three times his annual salary in effect at the time of termination and two times the average annual Bonuses payable to him for the last three completed calendar years prior to the Termination Date. If Dr. Missling was terminated by the Company without cause on September 30, 2023, he would have been entitled to a severance payment of $2,444,750. If Dr. Missling terminated his employment for Good Reason on September 30, 2023, he would have been entitled to a severance payment of $2,329,800. Our CFO Employment Agreement with Ms. Boenisch contains provisions regarding our obligations upon her termination. Any capitalized term not defined herein is used as defined in the CFO Employment Agreement. Under the CFO Employment Agreement, if Ms. Boenisch is terminated without Cause, the Company shall pay Ms. Boenisch severance compensation equal to six months base salary payable by the Company for the six-month period following the Termination. In addition, the Company must provide Ms. Boenisch thirty (30) day notice of her Termination. If the Company opts to have Ms. Boenisch cease providing services to the Company prior to the expiration of the thirty (30) day notice-period (the “Notice Period”), Ms. Boenisch shall receive the Compensation and Benefits for the full length of the Notice Period as if such period was not waived. In addition, any unvested stock options or stock awards vesting in the contract year of Termination held by Ms. Boenisch as of the Date of Termination shall immediately vest. If Ms. Boenisch was terminated by the Company without cause on September 30, 2023, she would have been entitled to continued salary payments equal to $97,890 in total. The following table presents accelerated vesting for certain equity awards outstanding at the time of the executive’s termination for each named executive officer, if employment were terminated by either the Company without cause or by Dr. Missling for good reason on September 30, 2023:
Potential Payments Upon Termination
| | Vesting Upon Termination | | | Named Executive Officer | Unvested Stock Options (#) | Stock Option Awards Estimated Benefit ($)(1) | | Dr. Christopher Missling | 2,000,000 | — | | Sandra Boenisch | —(2) | — |
Potential Payments Upon Termination
(1) Estimated benefit based on the closing stock price of $6.55 at September 30, 2023. (2) Ms. Boenisch’s unvested stock options at September 30, 2023 all contained performance based vesting conditions, therefore such options would not automatically vest upon Termination.
Potential Payments Upon Change in Control
Potential Payments Upon Change in Control If the Company is subject to a Change in Control, then the CEO Employment Agreement and the CFO Employment Agreement provide that all previously granted but unvested stock options held by Dr. Missling and Ms. Boenisch shall vest. The following table presents accelerated vesting for certain equity awards outstanding to the Named Executive Officer, if a change in control had occurred at September 30, 2023:
Potential Payments Upon Change in Control
| | Vesting Due to Change in Control | | | Named Executive Officer | Unvested Stock Options (#) | Stock Option Awards Estimated Benefit ($)(1) | | Dr. Christopher Missling | 2,000,000 | — | | Sandra Boenisch | 130,000 | — |
Potential Payments Upon Change in Control
(1) Estimated benefit based on the closing stock price of $6.55 at September 30, 2023. For a complete description of these terms and conditions please refer to the CEO Employment Agreement and CFO Employment Agreement (and their amendments) filed as exhibits to the Company’s most recent Annual Report on Form 10-K.