Rockwell Medical (RMTI) DEF 14ADefinitive proxy

Only stockholders of record of our common stock, par value $0.0001 per share, which we refer to as our common stock, at the close of business on April 8, 2020, the record date for the Annual Meeting, will be entitled to notice of, and to vote at, the Annual Meeting or any adjournment or postponement thereof. As of the close of business on the record date, we had 69,049,102 shares of common stock outstanding, the only class of stock outstanding and entitled to vote. Each share of common stock is entitled to one vote on each matter submitted for a vote at the Annual Meeting. The presence, in person or by proxy, of the holders of record of a majority of the outstanding shares of common stock entitled to vote is necessary to constitute a quorum for the transaction of business at the Annual Meeting or any adjournment or postponement thereof. Abstentions and broker non-votes will be treated as shares present at the meeting for purposes of determining the presence of a quorum.

If you hold your shares in street name as of the record date, the notice of meeting, the Proxy Statement, the 2019 Annual Report and a voting instruction form have been forwarded to you by your broker, bank or nominee. As the beneficial or “street name” owner, you have the right to direct your broker, bank or nominee how to vote your shares by using the voting instruction form included in the mailing. In accordance with applicable regulations, unless you provide your broker, bank or nominee with instructions on how to vote your shares, your shares will not be voted by the broker, bank or nominee on any matter listed in this Proxy Statement other than the proposal to ratify the Company’s independent auditors for 2020. Therefore, if you want the shares you beneficially own to be voted, you should return your voting instruction form or otherwise vote your shares as set forth below.

If you wish to attend and vote at the Annual Meeting and you are a street name holder, you must request and obtain a legal proxy or power of attorney from your bank, broker or nominee, bring it to the Annual Meeting with you and attach it to the ballot you vote at the Annual Meeting. Please follow the instructions from your bank, broker or nominee, or contact your bank, broker or nominee to request a power of attorney or other proxy authority. Ballots of street name holders that are not accompanied by a legal proxy or power of attorney from the record holder of their shares will not be counted. If you follow the procedures and vote online at the Annual Meeting, you will revoke any prior proxy you may have submitted.

If you are a street name holder and wish to attend the Annual Meeting but do not wish to vote at the Annual Meeting, you must present a legal proxy or power of attorney from your bank, broker or nominee or other reasonably acceptable proof that you beneficially owned your shares on the record date for the Annual Meeting.

You are considered a stockholder of record if your shares are registered directly in your name with our transfer agent. If you are a stockholder of record, you may vote your shares in either of the following ways:

Votes will be counted by the Inspector of Elections appointed for the Annual Meeting.

The affirmative vote of the holders of shares of common stock representing a majority of the votes cast on the matter is required for the advisory approval of executive compensation. Broker non-votes and abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of this proposal.

The affirmative vote of the holders of shares of common stock representing a majority of the votes cast on the matter is required for the ratification of the selection of our independent registered public accounting firm for the year ended December 31, 2020. Abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of this proposal.

The affirmative vote of the holders of shares of common stock representing a majority of the votes cast on the matter is required for the approval of the amendment and restatement of the 2018 Plan. Broker non-votes and abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of this proposal.

A stockholder who has submitted a completed proxy may revoke it at any time before it is voted at the Annual Meeting by giving written notice of such revocation to our Secretary or by executing and delivering to the Secretary a later dated proxy. Attendance at the Annual Meeting by a stockholder who has submitted a proxy will not have the effect of revoking it unless such stockholder votes at the Annual Meeting or submits written notice of revocation to the Company’s Secretary before the proxy is voted.

Any written notice revoking a proxy, and any later dated proxy, must be received by the Company prior to the date of the Annual Meeting (unless delivered directly to the Company’s Secretary at the Annual Meeting) and should be sent to Rockwell Medical, Inc., 411 Hackensack Ave., Suite 501, Hackensack, NJ 07601, Attention: David J. Kull, Secretary.

As of the date of filing this Proxy Statement, the Board knows of no other matters that will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the Annual Meeting, it is the intention of the persons named as proxies in the accompanying proxy card to vote on such matters in accordance with their best judgment.

We will pay the costs associated with the solicitation of proxies, including the preparation, assembly, printing and mailing of the proxy materials. We may also reimburse brokers, fiduciaries or custodians for the cost of forwarding proxy materials to beneficial owners of shares of common stock held in “street name.”

Our employees, officers and directors may solicit proxies in person or via telephone or the Internet. We will not pay additional compensation for any of these services.

We expect to announce preliminary voting results at the Annual Meeting. Final voting results will be published in a Current Report on Form 8-K to be filed with the U.S. Securities and Exchange Commission (the “SEC”) within 4 business days after the Annual Meeting.

Our Board is divided into three classes, designated Class I, Class II and Class III. Each year, on a rotating basis and until their successor has been elected and qualified, the terms of office of the directors in one of the three classes expire. Successors to the class of directors whose terms have expired will be elected for a three-year term. The terms of each of the Class II Directors expire at the Annual Meeting, the terms of each of the Class III Directors will expire at the 2021 annual meeting of stockholders and the terms of each of the Class I Directors will expire at the 2023 annual meeting of stockholders, in each case upon the election and qualification of the applicable successors. Lisa N. Colleran, who joined our Board in 2018, will leave the Board when her term expires at the Annual Meeting. The Board does not plan to appoint a new director in Ms. Colleran’s place and will reduce the size of the Board to six members.

Set forth below are the names and certain information for each continuing member of the Board, including the nominees for election as Class II directors, as of April 20, 2020. The information presented includes each director’s and nominee’s principal occupation and business experience for the past five years, and the names of other public companies of which he or she has served as a director during the past five years. The information presented below regarding the specific experience, qualifications, attributes and skills of each director and nominee led our Governance and Nominating Committee and our Board to conclude that he or she should serve as a director. In addition, we believe that all of our directors and nominees possess the attributes or characteristics described in “Corporate Governance-Governance and Nominating Committee” that the Governance and Nominating Committee expects of each director. There are no family relationships among any of our directors, nominees for director, or executive officers.

Class II Director Nominees (Terms Expiring 2023)

Unless contrary instructions are given, the shares represented by a properly executed proxy will be voted FOR the election of each nominee. Should any of the nominees become unavailable to accept election as a director, the persons named in the enclosed proxy will vote the shares as they represent for the election of such other person as the Board may recommend or the Board may decrease the size of the Board. Management has no reason to believe that any nominee is unavailable or will not serve if elected.

Information regarding the remainder of our Board, along with corporate governance information, can be found starting on Page 7 of this Proxy Statement.

Under our Principles of Corporate Governance, any nominee who receive a greater number of votes “AGAINST” their election than votes “FOR” their election must tender their resignation to the Governance and Nominating Committee. The Governance and Nominating Committee will then recommend to the Board whether to accept or reject the resignation offer, or whether other action should be taken. In determining whether to recommend that the Board accept any resignation offer, the Governance and Nominating Committee may consider all factors that the committee’s members believe are relevant. The Company will promptly disclose the Board’s decision-making process and decision regarding whether to accept a resignation offer in a Current Report on Form 8-K filed with the SEC. Nominees generally will not participate in the Governance and Nominating Committee’s or the Board’s considerations of the appropriateness of their continued service, but may otherwise remain active and engaged in all other Board-related activities, deliberations and decisions while consideration of such director’s resignation is ongoing.

Broker non-votes and abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of this proposal.

We believe that Mr. McLaughlin’s extensive legal, financial, strategic planning, capital raising and executive experience in the life sciences industry, as well as his public company board experience, qualify him for service as a director of our Company.

We believe that Mr. Radie’s prior executive management, finance, commercialization, capital raising, investor relations and public company experience in the life sciences industry qualifies him for service as a director of our Company.

Based on the absence of any material relationship between each such director and the Company, other than in their capacities as directors and stockholders, the Board has determined that each of Messrs. Cooper, McLaughlin, Radie and Ravich, and Ms. Colleran (representing all current directors other than Dr. Ellison, who also serves as the Company’s President and Chief Executive Officer) are independent, as independence is defined in the applicable Nasdaq Stock Market and SEC rules.

Our Principles of Corporate Governance provide that the Board will elect a Chairman of the Board, who is not the CEO of the Company. In the event that there is a need for a lead independent director, the Board will appoint a lead independent director. Our Board believes that it is in the best interests of the Company and our stockholders to separate the role of Chairman of the Board from the role of Chief Executive Officer. Our Board believes that this separate leadership structure enhances the accountability of our Chief Executive Officer to our Board, strengthens our Board’s independence from management and ensures a greater role for the independent directors in the oversight of the Company. In addition, our Board believes that separating these roles allows the Chief Executive Officer to focus his efforts on operating our business and managing our Company in the best interests of our stockholders, while the Chairman provides guidance to the Chief Executive Officer and, in consultation with management, helps to set the agenda for Board meetings and establishes priorities and procedures for the work of the full Board. The Chairman presides over meetings of the full Board. Mr. McLaughlin serves as Chairman of the Board and Dr. Ellison serves as the Company’s President and CEO, as well as a Class III Director.

Our Board believes that the current Board leadership structure is in the best interests of the Company and its stockholders at this time. Our Board recognizes that no single leadership model is right for all companies and at all times and that, depending on the circumstances, other leadership models, such as combining the Chairperson and CEO roles, might be appropriate. Accordingly, our Board periodically reviews its leadership structure. Our Principles of Corporate Governance provide the flexibility for our Board to modify or continue its leadership structure in the future, as it deems appropriate.

During 2019, the Board held 16 meetings. Each current director attended at least 75% of the total number of meetings of the Board and committees of which they were a member in 2019. It is the Board’s policy that, absent any unusual circumstances, all director nominees standing for election will attend the Annual Meeting. Our 2019 annual meeting of stockholders was conducted virtually, with a majority of the then-sitting directors attending the meeting. In addition to formal Board meetings, the Board members have frequent informal discussions and conferences with management throughout the year.

The functions of the Audit Committee include, among other things, (1) monitoring the adequacy of the Company’s internal controls; (2) engaging and overseeing the work of the registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit, review or attest services for us, including the conduct of the annual audit and overseeing the independence of such firm; (3) overseeing our independent accountants’ relationship with the Company; (4) reviewing the audited financial statements and the matters required to be discussed by Auditing Standard No. 1301 with management and the independent accountants, including their judgments about the quality of our accounting principles, applications and practices; (5) recommending to the Board whether our current audited financial statements should be included in our Annual Report on Form 10-K; (6) reviewing with management and our independent accountants our quarterly financial information before we file our Forms 10-Q; (7) reviewing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or auditing matters, and the confidential, anonymous submission by our employees of concerns regarding questionable accounting and compliance matters; (8) reviewing related party transactions required to be disclosed in our proxy statement for potential conflict of interest situations and, where appropriate, approving such transactions; and (9) monitoring with management the status of pending litigation and investigations.

Based on its review and discussions described above, our Audit Committee recommended to our Board that our audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2019 as filed with the SEC.

Management is responsible for our financial reporting process, including its system of internal control, and for the preparation of consolidated financial statements in accordance with generally accepted accounting principles. Our independent accountants are responsible for auditing those financial statements. Our Audit Committee’s responsibility is to monitor and review these processes. Our Audit Committee has relied, without independent verification, on management’s representation that our financial statements have been prepared with integrity and objectivity and in conformity with accounting principles generally accepted in the United States of America and on the representations of our independent accountants included in their report on our financial statements.

In identifying candidates for director, our Governance and Nominating Committee will consider suggestions from incumbent directors, management or others, including stockholders. Our Governance and Nominating Committee may retain the services of a consultant from time to time to identify qualified candidates for director. Our Governance and Nominating Committee reviews all candidates in the same manner without regard to who suggested the candidate. In selecting candidates, our Governance and Nominating Committee will consider all factors it believes appropriate, which may include (1) ensuring that the Board, as a whole, is diverse and consists of individuals with various and relevant career experience, technical skill, industry knowledge and experience, financial expertise, local or community ties, and (2) individual qualifications, including strength of character, mature judgment, familiarity with our business and industry, especially the life sciences industry, independence of thought and an ability to work collegially. Although it has no formal policy with regard to diversity, the charter states that our Governance and Nominating Committee should, with respect to diversity, consider such factors as differences of viewpoint, education, skill and other individual qualities and attributes that contribute to board heterogeneity, including characteristics such as race, gender and national origin. Our Governance and Nominating Committee is committed to seeking highly qualified candidates inclusive of all national origins, races and genders to include in the pool from which director nominees are chosen.

Nominees for director that are proposed by stockholders must be proposed pursuant to timely notice in writing to our Secretary, at Rockwell Medical, Inc., 411 Hackensack Ave., Suite 501, Hackensack, NJ 07601, as provided in our bylaws. The requirements for proposing director candidates, as set forth in our bylaws, are described below.

Stockholders proposing director nominees for election at the 2021 annual meeting of stockholders must provide written notice of such intention, along with the other information required by our bylaws, to our Secretary at our principal executive offices no earlier than the close of business on January 18, 2021 and no later than February 18, 2021. If the 2021 annual meeting of stockholders date is significantly advanced or delayed from the first anniversary of the date of the Annual Meeting, then the notice and information must be given not later than the 90th day before the meeting or, if later, the 10th day after the first public disclosure of the date of the 2021 annual meeting of stockholders. With respect to an election to be held at a special meeting of stockholders, such notice must be given in accordance with the procedures set forth in our bylaws no earlier than the close of business on the 120th day before and not later than the close of business on the 90th day before the date of such special meeting or, if later, the 10th day after the first public disclosure of the date of such special meeting. A proponent must also update the information provided in or with the notice at the times specified by our bylaws. Nominees for director pursuant to a notice which is not timely given or does not contain the information required by our bylaws or which is not delivered in compliance with the procedure set forth in our bylaws will not be considered at the stockholders meeting.

Only persons who are stockholders both as of the giving of notice and the date of the stockholders meeting and who are eligible to vote at the stockholders meeting are eligible to nominate directors. The nominating stockholder (or his qualified representative) must attend the stockholders meeting in person and present the proposed nominee in order for the proposed nominee to be considered.

The Board has not established specific, minimum qualifications for recommended nominees or specific qualities or skills for one or more of our directors to possess. The Board uses a subjective process for identifying and evaluating candidates for nomination as a director, based on the information available to, and the subjective judgments of, the members of the Board and our then current needs. The Board does not believe there would be any difference in the manner in which it evaluates candidates based on whether the candidate is recommended by a stockholder.

Our Board has an active role, as a whole and also at the committee level, in overseeing management of the Company’s enterprise risks. While our Board oversees the Company’s enterprise risk management and establishes policies, Company management is responsible for day-to-day enterprise risk management processes. The Board and its committees provide enterprise

Our Board has adopted a Code of Business Conduct and Ethics that applies to all of our employees, officers and directors, including our principal executive officer, principal financial officer and principal accounting officer or controller. Our Code of Business Conduct and Ethics contains written standards that we believe are reasonably designed to deter wrongdoing and to promote:

Our Board has a process for our stockholders to send communications to our Board or Audit Committee, including complaints regarding accounting, internal accounting controls or auditing matters. Communications may be sent to our Board, our Audit Committee or specific directors by regular mail to the attention of our Board, our Audit Committee or specific directors, at our principal executive offices at 411 Hackensack Ave., Suite 501, Hackensack, NJ 07601. All of these communications will be initially reviewed by our Secretary (1) to filter out communications that the Secretary deems are not appropriate for the directors, such as communications offering to buy or sell products or services, and (2) to sort and relay the remainder (unedited) to the appropriate directors.

On July 31, 2018, the Company entered into an employment agreement with Mr. Paul (the “Paul Agreement”), pursuant to which he commenced employment on September 4, 2018. The Paul Agreement provides that he will serve as an at-will employee and he is entitled to an annualized base salary of $600,000, a year-end performance bonus with a target bonus of 60% of his base salary (commencing 2019 and to be paid in cash or stock), and eligibility to receive annual long-term incentive grants in cash or equity. In addition, the Paul Agreement provided Mr. Paul a sign-on bonus of $100,000 (Mr. Paul would have been required to repay a pro-rated portion of his sign-on bonus if the Company terminated his employment for Cause or if he resigned without Good Reason within 12 months of his commencement date), eligibility to receive a 2018 performance bonus in a target amount of $200,000 (the 2018 performance bonus could be no less than $100,000) and an initial equity award representing the right to acquire a total of up to 2,070,000 shares of Company common stock, compromised of 388,125 time-based options, 388,125 performance-based options, 388,125 time-based restricted stock units and 905,625 performance-based restricted stock units (the “Inducement Awards”). The Inducement Awards were issued outside of the Company’s stockholder-approved 2018 Long-Term Incentive Plan, in accordance with Nasdaq Listing Rule 5635(c)(4). For discussion regarding certain payments triggered upon a termination of employment, see “Payments Upon Termination or Change in Control.” Mr. Paul ceased serving as our President and Chief Executive Officer on April 17, 2020. As disclosed on the Company’s Form 8-K filed on April 20, 2020, the Company entered into an employment agreement with its new President and Chief Executive Officer, Dr. Ellison.

On October 26, 2018, the Company entered into an employment agreement with Angus Smith, pursuant to which he commenced serving as the Company's Chief Financial Officer effective November 25, 2018 (the "Smith Agreement"). The Smith Agreement provides that he will serve as an at-will employee and he is entitled to an annualized base salary of $400,000, a year-end performance bonus with a target bonus of 50% of his base salary (commencing 2019 and to be paid in cash or stock), and eligibility to receive annual long-term incentive grants in cash or equity commencing in 2020. In addition, the Smith Agreement provided Mr. Smith with a sign-on bonus of $125,000 (Mr. Smith would have been required to repay a pro-rated portion of his sign-on bonus if the Company terminated his employment for Cause or if Mr. Smith resigned without Good Reason within 12 months of his commencement date) and an initial equity grant on his commencement of employment representing the right to acquire a total of up to 500,000 shares of Company common stock, compromised of 333,333 time-based options, 83,334 time-based restricted stock units and 83,333 performance-based restricted stock units. For discussion regarding certain payments triggered upon a termination of employment, see "Payments Upon Termination or Change in Control."

Dr. Gupta commenced employment with the Company in 2009. On October 7, 2018, in conjunction with the Master Services and IP Agreement that we entered into with Charak, LLC and Dr. Gupta, the Company entered into an employment agreement with Dr. Gupta, pursuant to which he continues to serve as the Company's Senior Vice President and Chief Scientific Officer (the "Gupta Agreement"). The Gupta Agreement provides for a term of 36 months, ending on October 8, 2021 (subject to certain termination provisions), after which Dr. Gupta shall continue to be employed as an at-will employee.

Dr. Gupta receives an annualized base salary of $510,000 and is eligible to earn year-end performance bonuses (to be paid in either cash or equity or both) with a target bonus of 50% of his base salary. Dr. Gupta is eligible to receive annual long-term incentive grants in cash or equity or both. Dr. Gupta also received a grant of 100,000 restricted stock units in 2018 connection with entering into the Gupta Agreement, which vested in full on the first anniversary of the date of the Gupta Agreement. For discussion regarding certain payments triggered upon a termination of employment, see "Payments Upon Termination or Change in Control.”

For purposes of determining 2019 Non-Equity Incentive compensation for Mr. Paul, Mr. Smith and Dr. Gupta, the Board, upon recommendation of the Compensation Committee, approved a set of corporate and individual goals for each executive that would determine their respective payout, subject to Board discretion.

Corporate goals for 2019 consisted of a variety of financial, commercial, pipeline advancement (development / regulatory) and business development objectives for the Company, including consolidated net sales for the year, the launch of Dialysate Triferic, Dialysate Triferic shipped volume, acceptance for filing of the I.V. Triferic New Drug Application (“NDA”), international partnerships and certain objectives related to the Company’s dialysis concentrates business. In determining each executive’s bonus, the Board considered the progress that was made during 2019 in achieving these goals, including the buildout of the Company’s infrastructure to support the Dialysate Triferic launch, the successful submission of the NDA for I.V. Triferic, and the Company’s progress in remediating internal controls deficiencies that were identified during fiscal 2018 following the resignation of the Company’s previous auditor and included in the 2018 audit report from Marcum LLP.

Mr. Paul’s individual goals for 2019 were based on various factors that the Board believed would enhance stockholder value, including goals tied to year-end total enterprise value, strategic plans, net sales of Dialysate Triferic, strategic plans for I.V. Triferic including the NDA submission, and international partnership activity. Based on a review of the 2019 corporate goals and individual goals for Mr. Paul, the performance of the overall enterprise value of the Company and in light of the Board’s ultimate discretion over Mr. Paul’s bonus for 2019, the Board determined that a bonus award to Mr. Paul for 2019 was not appropriate.

Dr. Gupta’s individual goals were based on various factors that the Board believed would enhance shareholder value, including goals tied to strategic goals for the Company’s scientific platform, including the development of a strategy and plan to position Triferic for the potential launch of HIF-PHIs in 2021, researching potential new indications for Triferic, and participation in the process of building a leading Medical Advisory Board for the purpose of advising the Company’s strategy for Triferic in both ESRD and potential new indications. Based on a review of the 2019 corporate goals and individual goals for Dr. Gupta, and in light of the Board’s ultimate discretion over Dr. Gupta’s bonus for 2019, the Board awarded a bonus of $61,090 to Dr. Gupta, representing 24% of his bonus target for the year.

In 2019, after consideration of internal equity and the fact that Dr. Gupta had not received an equity award since 2017, upon the recommendation of the Compensation Committee, the Board awarded Dr. Gupta 28,000 stock options and 17,000 restricted stock units. The stock options and the restricted stock units vest in three equal installments on the first, second and third anniversaries of April 25, 2019.

Our Board has established an anti-hedging and anti-pledging policy as part of our Principles of Corporate Governance and Insider Trading Policy. This policy prohibits any of our directors or executive officers and certain of our employees from (a) pledging shares of common stock or derivative securities as collateral for a loan, (b) engaging in hedging transactions and other transactions involving derivative securities, and (c) placing standing and limit orders that will remain in place for longer than one trading day other than in compliance with Rule 10b5-1(c) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Under the Paul Agreement, upon a termination of Mr. Paul’s employment by the Company without Cause or by Mr. Paul with Good Reason (each as defined therein), Mr. Paul is entitled to receive (i) his base salary then in effect plus 100% of the target bonus payable for such one-year period, (ii) a pro-rated annual bonus based on actual performance for the year in which Mr. Paul was terminated, (iii) COBRA coverage for one year, and (iv) the continued vesting for one year of that portion of the Inducement Awards that has time-based vesting conditions (but not those awards with performance-based vesting conditions). Additionally, all vested stock options shall continue to be exercisable for one year following the date of termination or until such options expire, in each case subject to Mr. Paul’s execution of a separation agreement and compliance with the Paul Agreement. Upon a termination of Mr. Paul’s employment due to death or Disability (as defined in the Paul Agreement), Mr. Paul would have been entitled to receive full acceleration of all outstanding equity awards and all stock options would have remained exercisable for the remainder of their stated terms. Mr. Paul would have also been eligible to receive certain benefits following a Change of Control and following termination by the Company other than for Cause or by Mr. Paul for Good Reason or upon death in connection with a Change of Control as discussed below.

During his employment and for one year following his termination, Mr. Paul is subject to certain non-competition and non-solicitation provisions set forth in the Paul Agreement. In connection with his entry into the Paul Agreement, Mr. Paul also entered into the Company’s form of Employee Confidentiality, Assignment of Inventions, Non-Interference and Non-Competition Agreement.

Upon a change in control, Mr. Paul would have been entitled to receive a minimum annual bonus equivalent to the bonus he received for the fiscal year preceding the year in which the change in control occurred (not to exceed the target bonus) subject to continued employment through the last day of the fiscal year in which the change in control occurred. If Mr. Paul’s employment had been terminated by the Company without Cause or by Mr. Paul with Good Reason or due to Mr. Paul’s death within 18 months following a change in control (or preceding a change in control if such termination had been in connection with or in anticipation of such change in control) (the “Effective Period”), Mr. Paul would have been entitled to receive a pro-rated target bonus for the year of termination, an amount equal to 1.5 times the sum of his base salary and 100% of his target bonus, COBRA coverage for 12 months and acceleration of all unvested equity and extension of the exercise period for all stock options for the remainder of their stated terms.

Under the Smith Agreement, upon a termination of Mr. Smith's employment by the Company without Cause or by Mr. Smith with Good Reason (each as defined therein), subject to Mr. Smith’s execution of a separation agreement and compliance with the Smith Agreement, Mr. Smith will be entitled to receive: (i) his base salary then in effect plus 100% of the target bonus payable for such one-year period, and (ii) COBRA coverage for one year. Mr. Smith will also be eligible to receive certain benefits following a Change of Control discussed below.

In connection with his entry into the Smith Agreement, Mr. Smith also entered into the Company's form of Employee Confidentiality, Assignment of Inventions, Non-Interference and Non-Competition Agreement.

Upon a change in control, if Mr. Smith’s employment is terminated by the Company without Cause or by Mr. Smith with Good Reason during the Effective Period, Mr. Smith is entitled to receive a pro-rated target bonus for the year of termination, an amount equal to 1.25 times the sum of his base salary and 100% of his target bonus, COBRA coverage for 12 months and acceleration of all unvested equity and extension of the exercise period for all stock options for the remainder of their stated terms.

Under the Gupta Agreement, upon a termination of Dr. Gupta's employment by the Company without Cause or by Dr. Gupta with Good Reason (each as defined therein), subject to Dr. Gupta’s execution of a separation agreement and compliance with the Gupta Agreement, Dr. Gupta will be entitled to receive: (i) his base salary then in effect from the date of termination through September 7, 2021, and (ii) COBRA coverage through September 7, 2021.

Additionally, all stock options held by Dr. Gupta shall immediately vest upon the date of termination, all vested stock options shall continue to be exercisable for two years following the date of termination (or until such options expire, if sooner), and the performance-based restricted stock award granted in 2017 shall continue to be eligible to vest for two years following the date of termination or until such award expires, in each case subject to Dr. Gupta's execution of a separation agreement and compliance with the Gupta Agreement. Upon a termination of Dr. Gupta’s employment due to death or Disability (as defined in the Gupta Agreement), Dr. Gupta will be entitled to full acceleration of all outstanding equity awards and all stock options will continue to be exercisable for the remainder of their stated terms. Dr. Gupta will also be eligible to receive certain benefits following a Change of Control discussed below.

In connection with his entry into the Gupta Agreement, Dr. Gupta also entered into the Company's form of Employee Confidentiality, Assignment of Inventions, Non-Interference and Non-Competition Agreement.

Upon a change in control, Dr. Gupta is entitled to receive an annual bonus for each fiscal year ending during the 18 months following such change in control up to his target bonus subject to continued employment through the last day of each such fiscal year. If Dr. Gupta’s employment is terminated by the Company without Cause or by Dr. Gupta with Good Reason during the Effective Period, Dr. Gupta is entitled to receive a pro-rated target bonus for the year of termination, an amount equal to his base salary plus 50% of his target bonus, COBRA coverage for 18 months and acceleration of all unvested equity and extension of the exercise period for all stock options for the remainder of their stated terms.

In addition to the severance benefits discussed above, the NEOs would receive certain benefits upon termination of employment that are provided to all salaried employees on a nondiscriminatory basis-accrued salary, unused paid-time off as permitted by the Company's policy and 401(k) plan distributions-and accelerated vesting of options granted pursuant to our 2007 Long Term Incentive Plan (the “2007 Plan”) if the NEO’s termination is due to death or permanent disability.

In the event of a change in control, all unvested options granted pursuant to the 2007 Plan become fully exercisable and all restricted stock awards will be deemed fully vested. In the event of a change of control, all unvested awards under the 2018 Plan do not accelerate automatically. However, if a participant’s employment terminates under certain qualifying circumstances (as described above for each NEO) after a change in control or if the surviving corporation does not assume our unvested awards, then the vesting of unvested awards will accelerate and be considered fully vested, provided that performance awards will only vest either to the extent the performance is met or assuming target performance, but pro-rated to reflect only the portion of the performance period that has lapsed, whichever is greater.

In 2018, the Compensation Committee decided that it needed to perform a review of its non-employee director compensation program to ensure the compensation was competitive in order to attract pharmaceutical industry experienced directors to our Board. The Compensation Committee engaged Cannae HR Solutions to review our existing compensation program for directors. Cannae HR Solutions recommended certain modifications to our non-employee compensation structure and amounts following a review of standard practices for director compensation and benchmarking analysis of peer group companies.

As a result, the Compensation Committee modified our non-employee director compensation program in 2018 to attract and retain pharmaceutical industry experienced directors. Also, the Compensation Committee recommended changes to compensation in view of the fact the Board had decided to separate the Chairman of the Board and Chief Executive Officer roles and functions. Based upon the recommendation of Cannae HR Solutions, the Compensation Committee recommended, and the Board approved, effective in 2018, the following director compensation changes: (1) increase in the director annual retainer from $150,000 to $175,000 per year, consisting of $60,000 in cash and $115,000 payable in stock options; (2) the Chairman of the Board would be paid an annual retainer of $50,000 payable in stock options; (3) directors serving as Chairpersons of a committee would be paid an annual retainer of $20,000, $15,000 and $10,000 for leading the Audit Committee, Compensation Committee and Governance and Nominating Committee, respectively, payable in stock options; and (4) each director serving on a committee (who is not the chair) would be paid an annual retainer of $12,000, $7,500 and $5,000 for service on the Audit Committee, Compensation Committee and Governance and Nominating Committee, respectively, payable in stock options. No fees are to be paid for attendance at any Board or committee meetings, but the independent directors will be reimbursed for their expenses incurred in attending such

For 2019, the Compensation Committee engaged Cannae HR Solutions to again review the existing compensation program for directors. Based upon the recommendation of Cannae HR Solutions, which was based in part on their review of grant practices for peer group companies, the Compensation Committee recommended, and the Board approved, that the value of compensation for the non-employee directors remain the same and the following changes to the director compensation described above: (1) the $115,000 payable in stock would be paid 50% in stock options and 50% in restricted stock units; (2) the annual retainer for the Chairman of the Board would be paid in restricted stock units; (3) the retainer for Chairperson of a committee would be paid in restricted stock units; (4) the retainer for directors service on a committee would be paid in restricted stock units and (5) a $10,000 retainer would be provided for the Chairperson of the Science Committee, payable in restricted stock units; and (6) a $5,000 retainer would be provided for a member of the Science Committee, payable in restricted stock units.

We have an anti-hedging and anti-pledging policy that applies to our directors. See “Compensation of Executive Officers-Anti-Hedging and Anti-Pledging Policy” for more information.

In accordance with Section 14A of the Exchange Act and related rules of the SEC, we are providing stockholders with an opportunity to vote on an advisory or non-binding resolution to approve the 2019 compensation of our NEOs as described in this Proxy Statement (sometimes referred to as “say on pay”). Consistent with the advisory vote of the stockholders in 2017, the Board has determined that the opportunity for such a vote will occur at every annual meeting of stockholders.

The Compensation Committee, comprised solely of independent directors, is responsible for our compensation policies and practices and has established a process for the review and approval of compensation programs and amounts awarded to our executive officers without encouraging excessive risk-taking. One of the key principles underlying our Compensation Committee’s compensation philosophy is pay for performance. We will continue to emphasize compensation arrangements that align the financial interests of our executives with the interests of long-term stockholders. We urge you to read the section of this Proxy Statement entitled “Compensation of Executive Officers and Directors” for a detailed discussion of our executive compensation practices and philosophy.

The Compensation Committee believes that the policies and procedures described in that section are effective in implementing our compensation philosophy. Therefore, we ask that you indicate your support for our executive compensation policies and practices as described in the tables and related narrative contained in this Proxy Statement by voting FOR the following resolution:

Approval of the compensation of our named executive officers in an advisory vote requires the affirmative vote of a majority of the votes cast by the holders of common stock entitled to vote on the matter. Your vote is advisory and so will not be binding on the Board. However, the Board and the Compensation Committee value the opinion of stockholders and expect to take into account the outcome of the vote when considering future executive compensation decisions to the extent they can determine the cause or causes of a negative vote.

Broker non-votes and abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of this proposal.

Approval of the proposal to ratify the selection of Marcum LLP as our independent registered public accounting firm requires the affirmative vote of a majority of the votes cast by the holders of common stock entitled to vote on the matter. We are not required to have stockholders ratify the selection of our independent registered public accounting firm. However, the Audit Committee is submitting its selection of Marcum LLP to our stockholders for ratification as a matter of good corporate practice and to help ensure that we will have the necessary quorum at our Annual Meeting. If our stockholders fail to ratify the selection, the Audit Committee will reconsider whether or not to retain Marcum LLP. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if they determine that such a change would be in the best interests of the Company and our stockholders.

Abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of this proposal.

We are asking our stockholders at the Annual Meeting to approve the amendment and restatement of the 2018 Plan to increase the number of shares of common stock issuable thereunder by 2,900,000. The share increase and corresponding increase in the incentive stock option limit under the 2018 Plan are the only changes to the 2018 Plan contemplated by the proposed amendment and restatement. In addition, as disclosed in our Form 8-K filed on April 20, 2020, in connection with the appointment of our new Chief Executive Officer, in order to provide him with a competitive compensation package, we granted him an equity award, including time-based stock options and 600,000 performance-based stock options, half of which will only vest if the net sales run rate for Triferic meets or exceeds $20,000,000 by no later than December 31, 2021 (provided that a portion of such performance-based options will be pro-rated to the extent the net annualized sales run rate meets or exceeds $14,500,000 by December 31, 2021) and half of which will only vest if the Company commences a Phase II Study for Triferic in a second indication of Triferic within one year of Dr. Ellison’s commencement of employment. The performance-based stock options are contingent upon the receipt of stockholder approval of this Proposal 4 (the “Contingent Options”). If stockholder approval is not obtained, then the Contingent Options will be forfeited in their entirety.

The purpose of the 2018 Plan is to enable us to grant equity and equity-linked long-term incentive compensation awards and performance-based cash incentive awards to recruit and retain prospective and current employees and directors. Our Board believes that the effective use of equity and equity-linked long-term incentive compensation awards and performance-based cash incentive awards is vital to our ability to attract, reward, and motivate our new employees and directors. Our Board believes that this, in turn, will help us achieve our growth objectives and enhance stockholder value.

The initial number of shares reserved for issuance under the 2018 Plan approved by stockholders at the 2018 annual meeting of stockholders was 3,300,000. Of this amount, approximately 967,000 shares remain available for issuance. The shares approved at the 2018 annual meeting of stockholders, as further described in the definitive proxy statement filed on April 30, 2018, were expected to last for approximately two to three award grant cycles, which have now passed. Accordingly, the Company is seeking an increase in the shares available for issuance and expects that such shares, when combined with the existing shares that remain available for issuance, will be sufficient to accommodate equity grants for approximately two annual award grant cycles from the date of this Proxy Statement.

In determining the number of shares to add to the plan, the Board considered factors such as the Company’s historical burn rate and the dilutive effect of all outstanding awards and awards eligible for issuance under the 2018 Plan, as well as the anticipated number of award grant cycles for which the amended 2018 Plan would last. The Board also considered certain other factors related to the dilutive effect of currently outstanding awards and awards eligible for issuance, including that approximately 4.0 million stock options, granted primarily to certain former officers and directors of the Company under the 2007 Plan, are scheduled to expire in 2020 and that 1.3 million performance-based stock options and performance-based RSUs granted as inducement awards outside of the 2018 Plan were forfeited upon the resignation of former CEO, Stuart Paul, in April 2020 and, thus, will not become available under the 2018 Plan. In addition, the Board considered the importance of granting equity awards, including the Contingent Options, to our new CEO in order to motivate and retain him given the competitive market for executive talent. The Contingent Options will be forfeited, however, unless the increase in the share reserve is approved by stockholders.

The following discussion of certain U.S. federal income tax consequences of the 2018 Plan is intended to be a summary of applicable federal law as currently in effect. Tax consequences for any particular individual or under state or non-U.S. tax laws may be different. This summary should not be taken as tax advice by participants, who are urged to consult their individual tax advisors.

Incentive stock options and non-qualified stock options are treated differently for federal income tax purposes. Incentive stock options are intended to comply with the requirements of Section 422 of the Code. Non-qualified stock options do not comply with such requirements. An optionee is not taxed on the grant or exercise of an incentive stock option. The difference between the exercise price and the fair market value of the shares on the exercise date will, however, be a preference item for purposes of the alternative minimum tax. If an optionee holds the shares acquired on exercise of an incentive stock option for more than two years following the option grant date and more than one year following exercise, the optionee’s gain, if any, on a subsequent disposition of such shares is long-term capital gain. The measure of the gain is the difference between the proceeds received on disposition and the optionee’s basis in the shares (which generally equals the exercise price). If an optionee disposes of stock acquired pursuant to the exercise of an incentive stock option before satisfying these holding periods, the optionee will generally recognize both ordinary income and capital gain in the year of disposition. The Company is not entitled to an income tax deduction on the grant or exercise of an incentive stock option or on the optionee’s disposition of the shares after satisfying the holding period requirement described above. If the holding periods are not satisfied, subject to Section 162(m) of the Code and the Company satisfying applicable reporting requirements, the Company will be entitled to an income tax deduction in the year the optionee disposes of the shares in an amount equal to the ordinary income recognized by the optionee.

In order for an option to qualify for incentive stock option tax treatment, the grant of the option must satisfy various other conditions more fully described in the Code. The Company does not guarantee that any option will qualify for incentive stock option tax treatment even if the option is intended to qualify for such treatment. In the event an option intended to be an incentive stock option fails to so qualify, it will be taxed as a non-qualified stock option as described below.

An optionee is not taxed on the grant of a non-qualified stock option. On exercise of the option, the optionee recognizes ordinary income equal to the difference between the exercise price and the fair market value of the shares acquired on the date of exercise. Subject to Section 162(m) of the Code and the Company satisfying applicable reporting requirements, the Company is entitled to an income tax deduction in the year of exercise in the amount recognized by the optionee as ordinary income. The optionee’s gain (or loss) on a subsequent disposition of the shares is long-term capital gain (or loss) if the shares are held for more than one year following exercise. The Company does not receive an income tax deduction for this gain.

If the participant files an election under Section 83(b) of the Code within thirty days after the grant date, the participant will recognize ordinary income as of the grant date equal to the fair market value of the restricted stock as of that date, less any amount paid for the restricted stock, and we will be allowed a corresponding tax deduction at that time, subject to any applicable limitations under Section 162(m) of the Code. Any future appreciation in the restricted stock will be taxable to the participant at capital gains rates upon disposition of the shares. However, if the restricted stock is later forfeited, such participant will not be able to recover the tax previously paid pursuant to the Section 83(b) election.

A participant will not recognize income, and we will not be allowed a tax deduction, at the time a restricted stock unit award, performance award or incentive award is granted. When a participant receives payment under any such award, the amount of cash received and the fair market value of any common stock received will be ordinary income to the participant, and we will be allowed a corresponding tax deduction at that time, subject to any applicable limitations under Section 162(m) of the Code.

Section 409A of the Code provides specific rules regarding the payment of “deferred compensation,” which includes payment under traditional deferred compensation plans, as well as payment pursuant to certain equity-based awards.  If the requirements of Section 409A are not complied with, holders of equity awards may be taxed earlier than would otherwise be the case (e.g., at the time of vesting instead of the time of payment or exercise) and may be subject to an additional 20% income tax and, potentially, interest and other penalties. The Company has sought to structure the 2018 Plan, and it expects to seek to structure awards granted thereunder, to either comply with Section 409A or to be exempt from Section 409A.

Section 162(m) of the Code establishes a $1 million deduction limit on compensation the Company pays to each of its “covered employees” during any year. “Covered employees” are the Company’s chief executive officer, chief financial officer, three other highest paid officers for the year, and any individual who was a “covered employee” for any prior year starting with 2017.

The Company will generally be required to withhold applicable taxes with respect to any ordinary income recognized by a participant in connection with the issuance, vesting and exercise of, or payments under, awards made under the 2018 Plan. Whether or not such withholding is required, the Company will make such information reports to the Internal Revenue Service as may be required with respect to any income (whether or not that of an employee) attributable to transactions involving awards.

The Compensation Committee and the Board have full discretion to determine the value and number of awards to be granted to employees, officers, directors and consultants under the 2018 Plan, subject to the terms of the 2018 Plan. Therefore, the future benefits or amounts that would be received by our executive officers, directors and employees under the 2018 Plan are not determinable as of the date of this Proxy Statement, except with respect to the time-based and performance-based stock options awarded to Dr. Ellison on April 17, 2020. As of April 8, 2020, the closing price of a share of the Company’s common stock was $2.12. The following table sets forth the stock options and restricted stock units outstanding under the 2018 Plan as of April 8, 2020 for the following persons or groups: (i) each of our NEOs; (ii) all current executive officers as a group; (iii) all current non-employee directors as a group; and (iv) all employees, including all current officers who are not executive officers, as a group; provided, however, that the value and number of the time-based and performance-based stock options awarded to Dr. Ellison on April 17, 2020 are included in the all current non-employee directors as a group total since Dr. Ellison was a non-employee director as of April 8, 2020.

As of December 31, 2019, we had an aggregate of 10,050,893 stock options and RSUs outstanding, of which 5,875,501 stock options were granted under the 2007 Plan, 1,696,398 stock options and 354,036 RSUs were granted under the 2018 Plan and 1,026,250 stock options and 1,098,708 RSUs were granted outside of our equity incentive plans as inducement awards. Of the outstanding stock options under the 2007 Plan, approximately 4,000,000 (which were granted primarily to certain former officers and directors of the Company) will expire in 2020. In addition, approximately 388,125 stock options and 905,625 RSUs that were granted outside of our equity incentive plans as inducement awards were forfeited upon the resignation of our former CEO in April 2020.

The following table summarizes our compensation plans, including individual compensation arrangements, under which our equity securities are authorized for issuance as of December 31, 2019:

Approval of the proposal to amend the 2018 Plan to increase the number of shares of common stock issuable thereunder by 2,900,000 shares requires the affirmative vote of a majority of the votes cast by the holders of common stock entitled to vote on the matter.

Broker non-votes and abstentions will not be counted as votes cast on the matter and will have no effect on the outcome of this proposal.

Section 16(a) of the Exchange Act requires our officers and directors, and persons who own more than ten percent of a registered class of our equity securities (collectively, the “Reporting Persons”) to file reports of ownership and changes in ownership with the SEC. Based solely on our review of the copies of the Forms 3, 4 and 5 and any amendments thereto filed electronically with the SEC by the Reporting Persons with respect to the fiscal year ended December 31, 2019, we believe that the Reporting Persons have timely complied with all filing requirements under Section 16(a) of the Exchange Act, with the exception of: Dr. Ajay Gupta, our Senior Vice President and Chief Scientific Officer, filed two late Forms 4 disclosing three late transactions; David J. Kull, our Secretary and former Principal Accounting Officer, filed a late Form 4 disclosing two late transactions; Stuart M. Paul, our former Chief Executive Officer, filed a late Form 4 disclosing one late transaction; and Raymond Pratt, our Chief Medical Officer, filed a late Form 4 disclosing two late transactions.

The following table sets forth information regarding the ownership of shares of common stock as of April 8, 2020 (unless otherwise indicated) with respect to:

The number of shares beneficially owned is determined under rules of the SEC and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rules, beneficial ownership includes any shares as to which the individual has sole or shared voting power or investment power and also any shares which the individual has the right to acquire on the April 8, 2020 or within sixty days thereafter through the exercise of any stock option or other right. The persons named in the table have sole voting power and sole dispositive power with respect to the shares of common stock beneficially owned, except as otherwise noted below.

We have described below each transaction or series of similar transactions since January 1, 2018, or any currently proposed transaction, to which we were or are a party in which:

Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to such securities.

We are party to a license agreement, dated January 7, 2002, with Charak LLC (“Charak”) and its owner, Dr. Ajay Gupta, for our Triferic® product that covers issued patents in the United States, the European Union and Japan, as well as patent and pending patent applications in other foreign jurisdictions. Dr. Gupta joined us as our Chief Scientific Officer in 2009. The license agreement, which was negotiated on an arm’s length basis before Dr. Gupta had any employment relationship with us, continues for the duration of the underlying patents in each country. We are obligated under the license agreement to make certain milestone payments and to pay ongoing royalties upon successful introduction of the product. No royalties were accrued and payable pursuant to the

In October 2018, we entered into a Master Services and IP Agreement (the “MSA”) with Charak and Dr. Gupta. Pursuant to the MSA, we entered into three additional agreements related to the license of certain soluble ferric pyrophosphate intellectual property owned by Charak. The MSA provides for a payment of $1,000,000 to Dr. Gupta, of which $250,000 was paid in 2018 and the remainder was paid in installments over 2019, as well as the reimbursement for certain legal fees incurred in connection with the MSA. Pursuant to the MSA, we entered into an amendment to the 2002 license agreement and entered into new license agreements providing for additional rights relating to Triferic. No royalties were accrued and payable pursuant to these agreements for 2018. We paid $28,306 in royalties pursuant to these agreements in 2019.

Pursuant to its charter, our Audit Committee is charged with monitoring and reviewing transactions and relationships involving independence and potential conflicts of interest with respect to our directors and executive officers. To the extent any such transactions are proposed, they would be subject to approval by our Audit Committee in accordance with applicable law and the Nasdaq Stock Market rules, which require that any such transactions required to be disclosed in our proxy statement be approved by a committee of independent directors of our Board. In addition, our Code of Business Conduct and Ethics generally requires directors and employees to avoid conflicts of interest.

The cost of soliciting proxies will be borne by the Company. In addition to soliciting proxies by mail, proxies may be solicited personally and by telephone by certain officers and regular associates of the Company. Such individuals will not be paid any additional compensation for such solicitation. The Company will reimburse brokers and other nominees for their reasonable expenses in communicating with the persons for whom they hold shares of the Company.

Any proposal by a stockholder of the Company to be considered for inclusion in the proxy statement for the 2021 annual meeting of stockholders must be received by David J. Kull, our Secretary, by the close of business on December 21, 2020. Such proposals should be addressed to him at our principal executive offices and should satisfy the informational requirements applicable to stockholder proposals contained in the relevant SEC rules. If the date for the 2021 annual meeting of stockholders is significantly different than the first anniversary of the Annual Meeting, Rule 14a-8 of the SEC provides for an adjustment to the notice period described above.

For stockholder proposals not sought to be included in our proxy statement, our bylaws provide that, in order to be properly brought before the 2021 annual meeting of stockholders, written notice of such proposal, along with the information required by our bylaws, must be received by our Secretary at our principal executive offices no earlier than the close of business on January 18, 2021 and no later than February 18, 2021. If the 2021 annual meeting of stockholders date has been significantly advanced or delayed from the first anniversary of the date of the Annual Meeting, then notice of such proposal must be given not later than the 90th day before the meeting or, if later, the 10th day after the first public disclosure of the date of the Annual Meeting. A proponent must also update the information provided in or with the notice at the times specified in our bylaws.

Only persons who are stockholders both as of the giving of notice and the date of the stockholders meeting and who are eligible to vote at the stockholders meeting are eligible to propose business to be brought before a stockholders meeting. The proposing stockholder (or the stockholder’s qualified representative) must attend the stockholders meeting in person and present the proposed business in order for the proposed business to be considered.

We have adopted a procedure approved by the SEC called “householding.” Under this procedure, certain stockholders of record who have the same address and last name will receive only one copy of our notice of annual meeting of stockholders, proxy

Stockholders who participate in householding will continue to receive separate proxy cards. Also, householding will not in any way affect other mailings.

If you are eligible for householding, but you and other stockholders of record with whom you share an address currently receive multiple copies of the notice of annual meeting of stockholders, proxy statement and accompanying documents, or if you hold shares of common stock in more than one account, and in either case you wish to receive only a single copy of each of these documents for your household, please contact the Company’s Secretary at 411 Hackensack Ave., Suite 501, Hackensack, NJ 07601, or by telephone at (248) 960-9009.

If you participate in householding and wish to receive a separate copy of the notice of annual meeting of stockholders, proxy statement and the accompanying documents, or if you do not wish to participate in householding and prefer to receive separate copies of these documents in the future, please contact the Company’s Secretary as indicated above.

Beneficial owners can request information about householding from their banks, brokers or other holders of record.

Neither we nor the members of our Board intend to bring before the Annual Meeting any matters other than those set forth in the notice of Annual Meeting, and we and they have no present knowledge that any other matters will be presented for action at the Annual Meeting by others. If any other matters properly come before such Annual Meeting in accordance with our Bylaws, however, it is the intention of the persons named in the enclosed form of proxy to vote in accordance with their best judgment.