UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
Amendment No. 1
(Mark One)
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 2022
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to________________
Commission file number: 001-37606
ANAVEX LIFE SCIENCES CORP.
(Exact name of registrant as specified in its charter)
| Nevada | | 98-0608404 |
| (State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
| | | |
| 630 5th Avenue, 20th Floor, New York, NY USA | | 10111 |
| (Address of principal executive offices) | | (Zip Code) |
Registrant’s telephone number, including area code 1-844-689-3939
Securities registered under Section 12(b) of the Act:
| Common Stock, $0.001 par value | AVXL | NASDAQ Stock Market LLC |
| Title of each class | Trading Symbol | Name of each exchange on which registered |
Securities registered pursuant to Section 12(g) of the Act:
None
(Title of class)
| Indicate by checkmark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. |
| | Yes ☒ No ☐ |
| | |
| Indicate by checkmark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. |
| | Yes ☐ No ☒ |
| | |
| Indicate by checkmark whether the registrant has (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. |
| | Yes ☒ No ☐ |
| | |
| Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). |
| | Yes ☒ No ☐ |
Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. |
| Large accelerated filer ☒ | | Accelerated filer ☐ |
| Non-accelerated filer ☐ | | Smaller reporting company ☐ |
| | | Emerging growth company ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐ |
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal controls over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. |
| Yes ☒ No ☐ |
| Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). |
| | Yes ☐ No ☒ |
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter: $921 million based on a price of $12.31 per share, being the closing price of the registrant’s common stock on March 31, 2022.
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date: 78,032,135 issued and outstanding as of January 27, 2023.
DOCUMENTS INCORPORATED BY REFERENCE
None.
EXPLANATORY NOTE
This Amendment No. 1 to the Annual Report on Form 10-K (this “Amendment No. 1”) of Anavex Life Sciences Corp. (“Anavex” or the “Company”) amends the Company’s Annual Report on Form 10-K for the year ended September 30, 2022, which was filed with the Securities and Exchange Commission (“SEC”) on November 28, 2022 (the “Original Filing”). The Company is filing this Amendment No. 1 solely to file Part III (Items 10 through 14). This additional disclosure does not revise or alter the Company’s financial statements and any forward-looking statements contained in the Original Filing. As required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), this Amendment No. 1 contains new certifications by our principal executive officer and principal financial officer, which are being filed or furnished as exhibits to this Amendment No. 1.
PART III
ITEM 10 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Directors and Executive Officers
Our directors are to be elected at our annual meeting and each director elected is to hold office until his or her successor is elected and qualified. Our Board of Directors may remove our officers at any time.
Our directors and executive officers, their ages, positions held, and duration of such, are as follows:
| Name | Position | Age | Date first appointed |
| Christopher Missling, PhD | Director, President, Chief Executive Officer, Secretary | 57 | July 5, 2013 |
| Athanasios Skarpelos | Director | 55 | January 9, 2013 |
| Claus van der Velden, PhD | Director | 50 | March 2, 2018 |
| Steffen Thomas, PhD | Director | 56 | June 15, 2015 |
| Peter Donhauser, D.O. | Director | 57 | February 8, 2017 |
| Jiong Ma, PhD | Director | 58 | May 25, 2021 |
| Sandra Boenisch, CPA, CGA | Principal Financial Officer, Treasurer | 41 | October 1, 2015 |
Board Leadership Structure
The Board of Directors is composed of a majority of independent directors and the Chief Executive Officer of the Company, who holds the position of Chairman of the Board of Directors. The Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee each have oversight over specific areas of responsibility, as discussed further below. The Company believes that this structure is appropriate and allows for efficient and effective oversight, given the Company’s relatively small size (in terms of number of employees and in scope of operational activities), its corporate strategy, including the outsourcing of certain key activities, and its sole focus on biotechnology research and development.
Roles of Lead Independent Director and Chairman of the Board
We have a Lead Independent Director role with broad authority and responsibility, as described further below. The Lead Independent Director is Claus van der Velden.
Christopher Missling is the Chairman of the Board of Directors and President and Chief Executive Officer. As President and Chief Executive Officer, Dr. Missling is also involved in the day-to-day operations and is thus able to elevate the most critical business issues for consideration by the Board of Directors. The independent directors bring experience, oversight and expertise from outside of the Company, while Dr. Missling brings company-specific experience and expertise. The Board of Directors believes that Dr. Missling’s combined role enables strong leadership, creates clear accountability, and enhances the Company’s ability to communicate its message and strategy clearly and consistently to stockholders. Accordingly, the Board of Directors has determined that the combined role of Chairman and Chief Executive Officer with a strong lead independent director provides balance and is the best leadership structure for the Company at the current time and is in the best interests of the Company and its stockholders.
Board of Directors’ Role in Risk Oversight
The Board of Directors is responsible for oversight of the Company’s risk management process. The Board administers this oversight function directly through the Board of Directors as a whole, as well as through the committees of the board. Areas of focus include economic risk, operational risk, financial risk (accounting, investment or liquidity, and tax), competitive risk, legal and regulatory risk, cybersecurity risk and compliance and reputational risks. The Board of Directors is supported by regular reporting by management, which is designed to give the Board of Directors visibility over the Company’s operations and activities to adequately identify key risks and understand management’s risk mitigation strategies.
Business Experience
The following is a brief account of the education and business experience of directors and executive officers during at least the past five years, indicating their principal occupations during the period, and the names and principal businesses of the organizations by which they were employed.
Christopher Missling, PhD. Christopher Missling 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.
Athanasios Skarpelos. Athanasios (Tom) Skarpelos is a self-employed investor with 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.
Claus van der Velden, PhD. Claus van der Velden, PhD, 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. 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.
Steffen Thomas, PhD. Steffen Thomas, 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.
Peter Donhauser, D.O. Peter Donhauser, 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.
Jiong Ma, PhD. Jiong Ma has over 25 years of experience in the investing, building and scaling of companies with a 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.
Sandra Boenisch, CPA, CGA. Ms. Boenisch is a Chartered Professional Accountant (CPA, CGA) with over 15 years of accounting, audit and financial reporting experience in a variety of industries, both in the United States and Canada. Ms. Boenisch was an independent consultant, providing financial reporting services to a range of public companies in the United States and Canada since January 2012. From 2008 until 2012, Ms. Boenisch was employed at BDO Canada LLP (Vancouver, BC) where she was hired as a Senior Accountant and was later promoted to Manager, Audit Assurance. Ms. Boenisch specialized in managing assurance engagements for public companies in the United States and Canada. Prior to that, Ms. Boenisch worked for another public accounting firm from 2001 to 2008. As an independent consultant, Ms. Boenisch has acquired considerable experience in finance, governance, and regulatory compliance. She holds a BComm from Laurentian University.
Family Relationships
There are no family relationships between any director or executive officer.
Involvement in Certain Legal Proceedings
There are no material proceedings to which any director or executive officer or any associate of any such director or officer is a party adverse to our Company or has a material interest adverse to our Company.
Delinquent Section 16(a) Reports
None.
Business Code of Conduct & Ethics
We have adopted a code of conduct and ethics that applies to our directors, principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, and to all employees. We have posted our policy on our website at www.anavex.com/code-of-conduct.
Insider Trading Policy
Our Insider Trading Policy prohibits our directors, officers, employees and consultants from engaging in short sales, transactions in publicly traded options such as put, calls or other derivative securities, hedging transactions and other inherently speculative transactions with respect to our stock at any time. Our policy further prohibits such persons from engaging in transactions involving any loan, pledge or other transfer of beneficial ownership of the Company’s securities without obtaining advance clearance of the proposed transaction from our Insider Trading Compliance Officer.
Information Regarding Committees of the Board of Directors
The Board has an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee. The following table provides membership and meeting information for 2022:
| Name | | Audit Committee | | Compensation Committee | | Nominating and Corporate Governance Committee |
| Christopher Missling, PhD | | | | | | | | | | | | |
| Athanasios Skarpelos | | | X | | | | | | | | | |
| Claus van der Velden, PhD | | | X* | | | | X* | | | | X* | |
| Steffen Thomas, PhD | | | X | | | | X | | | | X | |
| Peter Donhauser, D.O. | | | | | | | X | | | | X | |
| Jiong Ma, PhD | | | X | | | | | | | | | |
| Meetings in 2022 | | | 5 | | | | 1 | | | | — | |
*Committee Chair
Audit Committee and Audit Committee Financial Experts
The Audit Committee is composed of four directors, each of whom is independent. The Audit Committee operates under a charter that was adopted by our Board of Directors. The Audit Committee oversees and reports to our Board of Directors on various auditing and accounting-related matters, including, among other things, the maintenance of the integrity of our financial statements, reporting process and internal controls; the selection, evaluation, compensation and retention of our independent registered public accounting firm; legal and regulatory compliance, including our disclosure controls and procedures; and oversight over our risk management policies and procedures.
Our Board of Directors has determined that Claus van der Velden is an “audit committee financial expert” as defined by applicable SEC and NASDAQ rules.
The Audit Committee has reviewed and discussed the audited consolidated financial statements with management. The Audit Committee has discussed with the Company’s independent registered public accounting firm the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the Securities and Exchange Commission (the “SEC”). In addition, the Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the firm’s communications with the Audit Committee concerning independence and has discussed with the independent registered accounting firm its independence from the Company and management. Based on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited consolidated financial statements for the Company for the fiscal year ended September 30, 2022 be included in the Annual Report on Form 10-K for the year ended September 30, 2022 filed with the SEC on November 28, 2022.
The foregoing report has been furnished by the Audit Committee.
Claus van der Velden (Chairman)
Athanasios Skarpelos
Steffen Thomas
Jiong Ma
Compensation Committee
The Compensation Committee is composed of three directors, each of whom is independent. The Compensation Committee operates under a charter that was adopted by our Board of Directors. The Compensation Committee assists our Board of Directors in discharging its responsibilities relating to compensation of our directors and executive officers. Its responsibilities include, among other things: reviewing, approving and recommending compensation programs and arrangements applicable to our officers; determining the objectives of our executive officer compensation programs; overseeing the evaluation of our senior executives; administering our incentive compensation plans and equity-based plans, including reviewing and granting equity awards to our executive officers; and reviewing and approving director compensation and benefits. The Compensation Committee can delegate to other members of our Board of Directors, or an officer or officers of the Company, the authority to review and grant stock-based compensation for employees who are not executive officers.
The Compensation Committee has the responsibilities and authority designated by NASDAQ rules. Specifically, the Compensation Committee has the sole discretion to select and receive advice from a compensation consultant, legal counsel or other adviser and is directly responsible for oversight of their work. The Compensation Committee must also determine reasonable compensation to be paid to such advisors by us.
The Compensation Committee met once during fiscal 2022 and also acted by written consent as required.
Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee (the “NCG Committee”) is appointed by the board to oversee and evaluate the Board’s performance and the Company’s compliance with corporate governance regulations, guidelines and principles, to identify individuals qualified to become Board members, to recommend to the Board proposed nominees for board membership, and to recommend to the Board directors to serve on each standing committee. The NCG Committee seeks to assemble a Board that possesses the appropriate balance of professional and industry knowledge, financial expertise and management experience that is necessary to oversee the Company’s business. The NCG also recognizes the importance of diversity in board composition, including diversity of experience, gender and ethnicity and seeks to continually strive towards optimal diversity. The NCG Committee operates under a charter that was adopted by our Board of Directors.
The NCG Committee did not meet during fiscal 2022 but acted by written consent as required.
ITEM 11. EXECUTIVE COMPENSATION
The Company’s compensation objectives are to offer our executive officers’ compensation and benefits that are competitive and meet our goals of attracting, retaining and motivating highly skilled, talented management, which is necessary for the Company to achieve its financial and strategic objectives and create long-term value for our stockholders.
A significant portion of the Company’s executive compensation opportunity is related to factors that directly and indirectly influence shareholder value, including long-term stock performance and operational performance. We believe the levels of compensation we provide should be competitive, reasonable and appropriate for our business needs and circumstances.
Our Executive Compensation Program and Philosophy
The intent of the Company’s compensation program is to attract and retain talent, to create incentives for and to reward excellent performance. We seek to compensate our executives in a manner that is competitive, rewards performance that creates shareholder value, recognizes individual contributions, and encourages long-term value creation.
The Compensation Committee meets at least once per year to review and evaluate executive compensation and each executive officer’s performance. The Compensation Committee utilizes quantitative and qualitative factors, including the accomplishment of initiatives, attitude, and leadership and applies overall judgment to assess performance, taking into account the financial condition of the Company. Ultimately, the Compensation Committee seeks to evaluate, based on the achievement of financial and nonfinancial objectives, the variable compensation, including special awards, of executive officers of the Company and decide on the base salary and target discretionary bonus for such persons taking into account relevant benchmark data.
The Compensation Committee believes that a significant portion of each executive’s compensation opportunity should be tied to variable compensation and value creation for shareholders. The Compensation Committee believes this mix provides an appropriate balance between the financial security required to attract and retain qualified individuals, and the Compensation Committee’s goal of ensuring that executive compensation rewards performance that benefits shareholders over the long term.
Compensation Risk Oversight
In administering our compensation program, the Compensation Committee strives to achieve a balance among the elements of compensation to accomplish the objectives of the program. The Compensation Committee reviews the Company’s overall compensation program in the context of the risks that may be presented by the structure of our compensation program and the metrics used to determine compensation under that program. Based upon this review, the Compensation Committee believes that our compensation program does not create a reasonable likelihood of a material adverse effect on the Company.
Compensation Consultants
The Compensation Committee makes recommendations to the Board for all compensation for executives, 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 2022, the Compensation Committee did not engage any compensation consultants.
Elements of Executive Compensation
We focus our executive compensation program on three related but distinct elements: base salary, cash bonuses and stock-related compensation.
Base Salary
Base salaries take into consideration a number of factors, including the executive’s job performance, our corporate performance, and compensation practices observed in the market.
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, or Board of Directors, works with the Chief Executive Officer to evaluate the Company’s financial performance and overall financial condition to determine if discretionary bonuses are to be paid.
Equity Compensation
Equity compensation includes stock option grants within the terms of our 2019 Omnibus Incentive Plan and our 2022 Omnibus Incentive Plan. Each executive officer is eligible for stock option grants under the Omnibus Incentive Plans which may vest over a required service period, “Time Based Awards”, or that vest 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 executive compensation with stockholder value over time. Subsequent awards are granted as Performance Awards, which are intended to align executive 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 executives, as well as all employees, are rewarded for the successful and timely accomplishment of these objectives. Generally, these performance criteria include milestones in connection with the successful execution, enrollment and completion of the Company’s clinical trials. Only our Board of Directors, acting in its sole discretion, or the Compensation Committee grants options or Performance Awards to our executive officers.
We view stock options as one of the more important components of our long-term, performance-based compensation philosophy.
We provide options through initial grants at or near the date of hire and subsequent periodic/annual grants. Generally, initial 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 an executive’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 executives in coordination with the release of material nonpublic information. We have not re-priced any of our options and do not intend to re-price or otherwise adjust outstanding options at any time in the future.
Other Compensation
Other components of compensation include employee medical benefit plans and 401(k) benefit plan contributions.
Employee Medical Benefit Plans. Our employee medical and welfare benefit plans include medical, dental, life, disability and accidental death and dismemberment insurance.
401(k) Plan. We have a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code. The plan covers all United States based employees. United States based employees eligible to participate in the plan may contribute up to the current statutory limits under the Internal Revenue Service regulations. The 401(k) plan permits the Company to make additional matching contributions on behalf of contributing employees.
Compensation Committee Interlocks and Insider Participation
No member of the Compensation Committee has ever been an officer or employee of the Company. None of the executive officers currently serves or has served on the Compensation Committee or board of directors of any other entity that has one or more executive officers serving as a member of the Board of Directors or Compensation Committee of the Company.
Compensation Committee Report
The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis contained in this Annual Report on Form 10-K/A. Based on this review and discussion, the Compensation Committee has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Annual Report on Form 10-K/A for the fiscal year ended September 30, 2022.
The foregoing report has been furnished by the Compensation Committee.
Claus van der Velden, Committee Chair
Steffen Thomas
Peter Donhauser
Summary Compensation
The particulars of compensation paid to our named executive officers for the last two completed fiscal years:
Name and Principal
Position | | Year | | Salary
($) | | Bonus
($) | | Option
Awards
($) | | All other
Compensation
($)(1) | | Total
($) |
Christopher Missling, PhD
| | | 2022 | | | | 586,400 | | | | 110,000 | | | | 6,045,043 | | | | 12,200 | | | | 6,753,643 | |
| President, Chief Executive Officer, | | | 2021 | | | | 550,000 | | | | 110,000 | | | | 8,745,457 | | | | 11,600 | | | | 9,417,057 | |
| and Director | | | 2020 | | | | 550,000 | | | | 55,000 | | | | 1,224,648 | | | | 11,400 | | | | 1,841,048 | |
| Sandra Boenisch(2) | | | 2022 | | | | 174,900 | | | | — | | | | 277,603 | | | | — | | | | 452,503 | |
| Principal Financial Officer and | | | 2021 | | | | 158,300 | | | | — | | | | 724,314 | | | | — | | | | 882,614 | |
| Treasurer | | | 2020 | | | | 117,041 | | | | 22,313 | | | | 155,864 | | | | — | | | | 295,218 | |
| (1) | Includes employer matching of defined contribution savings plan under Section 401(k) of the Internal Revenue Code. |
| (2) | Compensation to Ms. Boenisch denominated in Canadian Dollars and has been translated to US dollars at an exchange rate of 0.7831 during the year ended September 30, 2022 (2021: 0.7915; 2020: 0.7438). |
Employment Agreements
Christopher Missling
We and Dr. Missling entered into an employment agreement dated July 5, 2013, as amended and extended most recently by the third amendment effective April 7, 2022 (the “CEO Employment Agreement”), whereby we currently pay Dr. Missling an annual base salary of $700,000. In addition, Dr. Missling is eligible to earn an annual cash bonus for each whole or partial calendar year of up to twenty percent of his base salary, and to participate in our employee benefit plans. We have agreed to indemnify Dr. Missling in connection with his provision of services to us.
Sandra Boenisch
We and Ms. Boenisch entered into an amended and restated employment agreement dated October 4, 2017, as amended and extended, whereby we currently pay Ms. Boenisch an annual base salary of $240,000 Canadian dollars. Ms. Boenisch is eligible for discretionary salary increases.
Grants of Plan Based Awards
The following table sets forth the awards granted for each named executive officer during the year ended September 30, 2022 under our 2022 Omnibus Incentive Plan:
| | | | | All other option awards |
| Name | | Grant Date | | Number of securities underlying options (#)(1) | | Exercise or base price of option award ($/sh) | | Grant date fair value of option awards ($) (2) |
| Christopher Missling, PhD | | June 14, 2022 | | 500,000 | | $ | 7.54 | | | $ | 2,575,000 | |
| | | June 27, 2022 | | 500,000 | | $ | 10.09 | | | $ | 3,470,043 | |
| Sandra Boenisch | | June 27, 2022 | | 40,000 | | $ | 10.09 | | | $ | 277,603 | |
(1) Represents shares of our common stock underlying options awarded, each of which vest over time.
(2) 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
The following table sets forth for each named executive officer and director certain information concerning the outstanding equity awards as of September 30, 2022.
| 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 | | | 500,000 | | | | — | | | | — | | | | 1.60 | | | July 5, 2023
|
| Missling | | | 73,380 | | | | — | | | | — | | | | 1.32 | | | May 8, 2024
|
| | | | 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 |
| 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 |
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, 2022:
| | | Option Awards |
| Name | | Number of shares acquired on exercise (#) | | Value realized on exercise ($) |
| Christopher Missling | | | — | | | | — | |
| Sandra Boenisch | | | — | | | | — | |
Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans
There was no nonqualified deferred compensation for our named executive officers in fiscal 2022.
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 2022, we reasonably estimate that the ratio of our CEO’s annual total compensation to the annual total compensation of our median employee was 10.2:1. 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 2022 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, 2022. 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 2022. 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 2022 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, resulting in that employee’s annual total compensation of $674,500. The median employee’s annual total compensation includes annualized base salary, annualized bonus, annualized 401(k) matching contributions, and the fair value of awards granted during the fiscal year ended September 30, 2022 under our 2019 Omnibus Incentive Plan and 2022 Omnibus Incentive Plan.
With respect to the CEO, we used the amount reported as total compensation in the Summary Compensation Table included in this annual report on Form 10-K/A. Any estimates and assumptions used to calculate total annual compensation are described in footnotes to the Summary Compensation Table.
Compensation of Directors
The table below shows the compensation of our directors who were not our named executive officers for the fiscal year ended September 30, 2022:
| Name | | Fees Earned or Paid in Cash
($) | | Stock
Awards
($) | | Option
Awards
($) (1) | | Non-Equity Incentive Plan Compensation ($) | | Nonqualified Deferred Compensation Earnings ($) | | All Other Compensation ($) | | Total
($) |
| Athanasios Skarpelos | | | 25,000 | | | | — | | | | 382,120 | | | | — | | | | — | | | | — | | | | 407,120 | |
| Claus van der Velden | | | 41,000 | | | | — | | | | 382,120 | | | | — | | | | — | | | | — | | | | 423,120 | |
| Steffen Thomas | | | 25,000 | | | | — | | | | 382,120 | | | | — | | | | — | | | | — | | | | 407,120 | |
| Peter Donhauser | | | 25,000 | | | | — | | | | 382,120 | | | | — | | | | — | | | | — | | | | 407,120 | |
| Jiong Ma | | | 25,000 | | | | — | | | | 382,120 | | | | — | | | | — | | | | — | | | | 407,120 | |
(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, 2022, the aggregate number of outstanding vested and unvested stock option awards held by each director was as follows: Mr. Skarpelos possessed options to purchase 305,500 shares, Dr. van der Velden possessed options to purchase 255,500 shares, Dr. Thomas possessed options to purchase 355,500 shares, Dr. Donhauser possessed options to purchase 255,500 shares and Dr. Ma possessed options to purchase 110,000 shares.
We currently compensate non-employee directors $25,000 per year, paid quarterly. We compensate Claus van der Velden an additional $4,000 per quarter for performing the functions of Chairman of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee.
We regularly grant members of the Board of Directors awards of options. Each board member is granted options initially when they join the Board of Directors, which 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 2022, 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 of Directors. Our Board of Directors may award further special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director.
Retirement or Similar Benefit Plans
There are no arrangements or plans in which we provide retirement or similar benefits for our directors or executive officers.
Resignation, Retirement, Other Termination, or Change in Control Arrangements
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 by either 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, 2022, he would have been entitled to a severance payment of $2,375,000. If Dr. Missling terminated his employment for Good Reason on September 30, 2022, he would have been entitled to a severance payment of $2,283,300.
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, 2022, she would have been entitled to continued salary payments equal to $93,972 in total.
The following table presents accelerated vesting for certain equity awards outstanding at the time of the executive’s termination for each Named Executive Officer, if employment were terminated by either the Company without cause or by Dr. Missling for good reason on September 30, 2022:
| | | Vesting Upon Termination |
| Named Executive Officer | | Unvested Stock Options (#) | | Stock Option Awards Estimated Benefit ($)(1) |
| Dr. Christopher Missling | | | 2,050,000 | | | | 4,161,500 | |
| Sandra Boenisch | | | — | (2) | | | — | |
(1) Estimated benefit based on the closing stock price of $10.32 at September 30, 2022.
(2) Ms. Boenisch’s unvested stock options at September 30, 2022 all contained performance based vesting conditions, therefore such options would not automatically vest upon Termination.
Potential Payments Upon Change in Control
If the Company is subject to a Change in Control, then the CEO Employment Agreement and the CFO Employment Agreement provide that all previously granted but unvested stock options held by Dr. Missling and Ms. Boenisch shall vest.
The following table presents accelerated vesting for certain equity awards outstanding to the Named Executive Officer, if a change in control had occurred at September 30, 2022:
| | | Vesting Due to Change in Control |
| Named Executive Officer | | Unvested Stock Options (#) | | Stock Option Awards Estimated Benefit ($)(1) |
| Dr. Christopher Missling | | | 2,050,000 | | | | 4,161,500 | |
| Sandra Boenisch | | | 130,000 | | | | 250,700 | |
(1) Estimated benefit based on the closing stock price of $10.32 at September 30, 2022.
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 this Annual Report on Form 10-K.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The following table sets forth, as of January 27, 2023, certain information with respect to the beneficial ownership of our common stock by each stockholder known by us to be the beneficial owner of more than 5% of our common stock and by each of our current directors and our named executive officers and by our current directors and executive officers as a group. We have determined the number and percentage of shares beneficially owned by such person in accordance with Rule 13d-3 under the Securities Exchange Act of 1934. This information does not necessarily indicate beneficial ownership for any other purpose.
| Title of class | | Name and address of
beneficial owner | | Amount and nature of
beneficial ownership | | Percent of
class (1) |
| Directors and Named Executive Officers | | | | | | | | |
| Common Stock | | Christopher Missling (CEO/Director) | | | 7,029,644 | (2) | | | 8.4 | % |
| Common Stock | | Athanasios Skarpelos (Director) | | | 1,586,958 | (3) | | | 2.0 | % |
| Common Stock | | Claus van der Velden (Director) | | | 205,500 | (4) | | | * | |
| Common Stock | | Steffen Thomas (Director) | | | 305,500 | (5) | | | * | |
| Common Stock | | Peter Donhauser (Director) | | | 207,665 | (6) | | | * | |
| Common Stock | | Jiong Ma (Director) | | | 36,666 | (7) | | | | |
| Common Stock | | Sandra Boenisch (Principal Financial Officer) | | | 215,263 | (8) | | | * | |
| Common Stock | | Directors & Executive Officers as a group (7 persons) | | | 9,562,195 | | | | 11.2 | % |
| 5% Holders | | | | | | | | | | |
| Common Stock | | BlackRock, Inc.(9)
55 East 52nd Street
New York, NY 10055 | | | 5,262,666 | | | | 6.74 | % |
*Less than 1%
| (1) | Percentage of ownership is based on 78,032,135 of our common stock issued and outstanding as of January 27, 2023. Except as otherwise indicated, we believe that the beneficial owners of the common stock listed above, based on information furnished by such owners, have sole investment and voting power with respect to such shares, subject to community property laws where applicable. Beneficial ownership is determined in accordance with the rules of the Commission and generally includes voting or investment power with respect to securities. Shares of common stock subject to options or warrants currently exercisable or exercisable within 60 days, are deemed outstanding for purposes of computing the percentage ownership of the person holding such option or warrants but are not deemed outstanding for purposes of computing the percentage ownership of any other person. |
| (2) | Includes options to purchase 500,000 shares of our common stock at $1.60 per share, options to purchase 73,380 shares of our common stock at $1.32 per share, options to purchase 500,000 shares of our common stock at $0.92 per share, options to purchase 187,500 shares of our common stock at $5.04 per share, options to purchase 379,625 shares of our common stock at $6.26 per share, options to purchase 861,429 shares of our common stock at $7.06 per share, options to purchase 500,000 shares of our common stock at $3.28 per share, options to purchase 450,000 shares of our common stock at $5.92 per share, options to purchase 400,000 shares of our common stock at $3.30 per share, options to purchase 450,000 shares of our common stock at $2.30 per share, options to purchase 409,500 shares of our common stock at $2.58 per share, options to purchase 750,000 shares of our common stock at $3.15 per share, and options to purchase 550,000 shares of our common stock at $2.96 per share that are vested or are vesting within 60 days. Excludes options to purchase 550,000 shares of our common stock at $5.49 per share, options to purchase 500,000 shares of our common stock at $18.11 per share, options to purchase 500,000 shares of our common stock at $7.54 per share, and options to purchase 500,000 shares of our common stock at $10.09 per share that do not vest within 60 days. |
| (3) | Includes options to purchase 100,000 shares of our common stock at $3.28 per share, options to purchase 45,500 shares of our common stock at $2.58 per share, options to purchase 50,000 shares of our common stock at $2.96 per share, options to purchase 35,000 shares of our common stock at $5.49 per share, and options to purchase 25,000 shares of our common stock at $18.11 per share that have vested or are vesting within 60 days. Excludes options to purchase 50,000 shares of our common stock at $10.09 per share that do not vest within 60 days. |
| | (4) | Includes options to purchase 50,000 shares of our common stock at $2.60 per share, options to purchase 45,500 shares of our common stock at $2.58 per share, options to purchase 50,000 shares of our common stock at $2.96 per share, options to purchase 35,000 shares of our common stock at $5.49 per share, and options to purchase 25,000 shares of our common stock at $18.11 per share that have vested or are vesting within 60 days. Excludes options to purchase 50,000 shares of our common stock at $10.09 per share that are not vesting within 60 days. |
| (5) | Includes options to purchase 50,000 shares of our common stock at $1.76 per share, options to purchase 100,000 shares of our common stock at $3.28 per share, options to purchase 45,500 shares of our common stock at $2.58 per share, options to purchase 50,000 shares of our common stock at $2.96 per share, options to purchase 35,000 shares of our common stock at $5.49 per share, and options to purchase 25,000 shares of our common stock at $18.11 per share that have vested or are vesting within 60 days. Excludes options to purchase 50,000 shares of our common stock at $10.09 per share that are not vesting within 60 days. |
| (6) | Includes options to purchase 50,000 shares of our common stock at $5.39 per share, options to purchase 45,500 shares of our common stock at $2.58 per share, options to purchase 50,000 shares of our common stock at $2.96 per share, options to purchase 35,000 shares of our common stock at $5.49 per share, and options to purchase 25,000 shares of our common stock at $18.11 per share that have vested or are vesting within 60 days. Excludes options to purchase 50,000 shares of our common stock at $10.09 per share that are not vesting within 60 days. |
| (7) | Includes options to purchase 11,666 shares of our common stock at $13.01 per share and options to purchase 25,000 shares of our common stock at $18.11 per share that have vested or are vesting within 60 days. Excludes options to purchase 23,334 shares of common stock at $13.01 per share and options to purchase 50,000 shares of our common stock at $10.09 per share that do not vest within 60 days. |
| (8) | Includes options to purchase 30,000 shares of our common stock at $3.30 per share, options to purchase 30,000 shares of our common stock at $2.30 per share, options to purchase 27,300 shares of our common stock at $2.58 per share, options to purchase 35,000 shares of our common stock at $2.93 per share, and options to purchase 70,000 shares of our common stock at $2.96 per share that have vested or are vesting within 60 days. Excludes options to purchase 50,000 shares of our common stock at $5.49 per share, options to purchase 40,000 shares of our common stock at $18.11 per share, and options to purchase 40,000 shares of our common stock at $10.09 per share that do not vest within 60 days. |
| (9) | Based on Schedule 13G as filed with the SEC and dated on February 9, 2022 |
Change in Control
We are unaware of any contract or other arrangement, the operation of which may at a subsequent date result in a change of control of our Company.
Securities Authorized for Issuance under Equity Compensation Plans or Individual Compensation Arrangements
The following table summarizes certain information regarding our equity compensation plan or individual compensation arrangements at September 30, 2022:
| Equity Compensation Plan Information |
| Plan Category | | Number of securities to be issued upon exercise of outstanding options, warrants and rights
(a) | | Weighted-average exercise price of outstanding options, warrants and rights
(b) | | Number of securities remaining available for future issuances under equity compensation plans (excluding securities reflected in column (a))
(c) |
| Equity compensation plans approved by security holders | | | 22,050,553 | | | | 6.61 | | | | 8,363,453 | |
| Equity compensation plans not approved by security holders | | | — | | | | — | | | | — | |
| Total | | | 22,050,553 | | | | 6.61 | | | | 8,363,453 | |
2022 Stock Option Plan
On March 25, 2022, the Board approved the 2022 Omnibus Incentive Plan (the “2022 Plan”). The 2022 Plan was approved by stockholders on May 24, 2022. Under the terms of the 2022 Plan, 10,000,000 shares of Common Stock were made available for issuance under the 2022 Plan, in addition to the shares available under the 2019 Omnibus Incentive Plan (the “2019 Plan”) and the 2015 Omnibus Incentive Plan (the “2015 Plan”). Any awards outstanding under a previous stock option plan will remain subject to and be paid under such plan, and any shares subject to outstanding awards under a previous plan that subsequently cease to be subject to such awards (other than by reason of settlement of the awards in shares) will automatically become available for issuance under the 2022 Plan.
The 2022 Plan provides that it may be administered by the Board, or the Board may delegate such responsibility to a committee. The exercise price will be determined by the Board at the time of grant shall be at least equal to the fair market value on such date. If the grantee is a 10% stockholder on the grant date, then the exercise price shall not be less than 110% of fair market value of the Company’s shares of common stock on the grant date. Stock options may be granted under the 2022 Plan for an exercise period of up to ten years from the date of grant of the option or such lesser periods as may be determined by the Board, subject to earlier termination in accordance with the terms of the 2022 Plan.
The purpose of the 2022 Plan is to retain the services of valued key employees and consultants of our Company and such other persons, and to encourage such persons to acquire a greater proprietary interest in our Company, thereby strengthening their incentive to achieve the objectives of the shareholders of our Company. The purpose is also to serve as an aid and inducement in the hiring of new employees and to provide an equity incentive to consultants.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Transactions with related persons
There have been no transactions, since October 1, 2021, or currently proposed transactions, in which we were or are to be a participant and the amount involved exceeds the lesser of $120,000 or one percent of the average of the smaller reporting company’s total assets at year end for the last two completed fiscal years, and in which any of the following persons had or will have a direct or indirect material interest.
| i. | any director or executive officer of our Company; |
| | |
| ii. | any beneficial owner of shares carrying more than 5% of the voting rights attached to our outstanding shares of common stock; and |
| | |
| iii. | any member of the immediate family (including spouse, parents, children, siblings and in-laws) of any of the foregoing persons. |
Compensation of Named Executive Officers and Directors
For information regarding compensation of named executive officers and directors, please see “Item 11. Executive Compensation.”
Director Independence
Under the NASDAQ Stock Market Rules, the Board has a responsibility to make an affirmative determination that those members of its Board that serve as independent directors do not have any relationships with the Company and its businesses that would impair their independence. The Board has determined that that Christopher Missling, PhD is not independent, as that term is defined by NASDAQ 5605(a)(2), because Mr. Missling serves as our President, Chief Executive Officer, and Secretary.
The Board has determined that that Claus van der Velden, Athanasios Skarpelos, Steffen Thomas, Peter Donhauser and Jiong Ma are independent, as that term is defined by NASDAQ 5605(a)(2) and the applicable rules of the Commission.
Board Meetings
During fiscal 2022, each member of the Board of Directors attended at least 75% of the aggregate of all meetings of the Board of Directors and all meetings of committees of the Board of Directors on which such director served that were held during the period in which such director served.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Fees Paid to Our Independent Registered Public Accounting Firm
The following table sets forth the aggregate fees billed or expected to be billed to our Company for professional services rendered by our independent registered public accounting firm, Grant Thornton, LLP for the fiscal years ended September 30, 2022 and 2021:
| | | 2022 | | 2021 |
| Audit Fees | | $ | 398,900 | | | $ | — | |
| Audit Related Fees | | | — | | | | — | |
| Tax Fees | | | — | | | | — | |
| All Other Fees | | | — | | | | — | |
| Total Fees | | $ | 398,900 | | | $ | — | |
The following table sets forth the aggregate fees billed to our Company for professional services rendered by BDO USA, LLP, our former independent registered public accounting firm, for the fiscal years ended September 30, 2022 and 2021:
| | | 2022 | | 2021 |
| Audit Fees | | $ | 210,895 | | | $ | 392,676 | |
| Audit Related Fees | | | — | | | | — | |
| Tax Fees | | | — | | | | — | |
| All Other Fees | | | — | | | | — | |
| Total Fees | | $ | 210,895 | | | $ | 392,676 | |
Audit Fees. Consist of fees billed for professional services rendered for the audits of our financial statements, reviews of our interim financial statements included in quarterly reports, services performed in connection with regular filings with the Commission for the fiscal years ended September 30, 2022 and 2021 in connection with statutory and regulatory filings or engagements.
Policy on Pre-Approval by Audit Committee of Services Performed by Independent Registered Public Accounting Firm
Our Audit Committee pre-approves all services provided by our independent registered public accounting firm. All of the above services and fees were reviewed and approved by our Audit Committee before the respective services were rendered.
Our Audit Committee has considered the nature and amount of fees billed or expected to be billed by Grant Thornton LLP and believes that the provision of services for activities unrelated to the audit was compatible with maintaining Grant Thornton LLP’s independence.
| Exhibit | |
| Number | Description |
| (3) | Articles of Incorporation and Bylaws |
| 3.1 | Articles of Incorporation, as amended (incorporated by reference to our Annual Report on Form 10-K filed on November 24, 2021) |
| 3.3 | Bylaws (incorporated by reference to our Current Report on Form 8-K filed on September 28, 2007) |
| (4) | Instruments Defining the Rights of Security Holders |
| 4.1 | Description of Registrant’s Securities (incorporated by reference to our Annual Report on Form 10-K filed on November 28, 2022) |
| (10) | Material Contracts |
| 10.1^ | 2015 Omnibus Incentive Plan (incorporated by reference to our Annual Report on Form 10- K filed on December 29, 2015) |
| 10.2^ | 2019 Omnibus Incentive Plan (incorporated by reference to our Proxy Statement, dated February 11, 2019, as filed on February 11, 2019) |
| 10.3^ | 2022 Omnibus Incentive Plan (incorporated by reference to our Registration Statement on Form S-8, as filed on June 10, 2022) |
| 10.4^ | Employment Agreement, dated as of July 5, 2013, by and between the Company and Christopher Missling, PhD (incorporated by reference to our Quarterly Report on Form 10-Q filed on August 14, 2013) |
| 10.5^ | First Amendment to Employment Agreement, dated as of July 5, 2016, by and between the Company and Christopher Missling, PhD (incorporated by reference to our Current Report on Form 8-K filed on July 7, 2016) |
| 10.6^ | Amended and Restated First Amendment to Employment Agreement, dated as of July 18,2016, by and between the Company and Christopher Missling, PhD (incorporated by reference to our Current Report on Form 8-K filed on July 22, 2016) |
| 10.7^ | Second Amendment to Employment Agreement, dated as of May 3, 2019 by and between the Company and Christopher Missling, PhD (incorporated by reference to our Quarterly Report on Form 10-Q filed on May 9, 2019) |
| 10.8^ | Third Amendment to Employment Agreement, dated April 7, 2022 by and between the Company and Christopher Missling, PhD (incorporated by reference to our Current Report on Form 8-K filed on April 8, 2022) |
| 10.9^ | Amended and Restated Employment Agreement by and between the Company and with Sandra Boenisch (incorporated by reference to our Annual Report on Form 10-K filed on December 11, 2017) |
| 10.10^ | Amendment No. 1 to Amended and Restated Employment Agreement between the Company and Sandra Boenisch, dated February 4, 2020 (incorporated by reference to our Quarterly Report on Form 10-Q filed on February 6, 2020) |
| 10.11^ | Amendment No. 2 to Amended and Restated Employment Agreement between the Company and Sandra Boenisch, dated February 28, 2022 (incorporated by reference to our Current Report on Form 8-K filed on March 4, 2022) |
| 10.12 | Amended and Restated Sales Agreement, dated May 1, 2020, by and among the Company, Cantor Fitzgerald & Co. and SVB Leerink LLC (incorporated by reference to our Current Report on Form 8-K filed on May 1, 2020) |
| (14) | Code of Ethics |
| 14.1 | Code of Ethics Adopted on September 13, 2016 (incorporated by reference to our Annual Report on Form 10-K filed on December 14, 2016) |
| (21) | Subsidiaries |
| 21.1 | Subsidiaries of the Registrant (incorporated by reference to our Annual Report on Form 10-K filed on November 28, 2022) |
| (31) | Section 302 Certifications |
| 31.1* | Section 302 Certification of Christopher Missling, PhD. |
| 31.2* | Section 302 Certification of Sandra Boenisch |
| (32) | Section 906 Certifications |
| 32.1* | Section 906 Certification of Christopher Missling, PhD and Sandra Boenisch |
| (101) | XBRL |
| 101.INS* | XBRL INSTANCE DOCUMENT |
| 101.SCH* | XBRL TAXONOMY EXTENSION SCHEMA |
| 101.CAL* | XBRL TAXONOMY EXTENSION CALCULATION LINKBASE |
| 101.DEF* | XBRL TAXONOMY EXTENSION DEFINITION LINKBASE |
| 101.LAB* | XBRL TAXONOMY EXTENSION LABEL LINKBASE |
| 101.PRE* | XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* Filed herewith.
^ Denotes a management contract or compensatory plan or arrangement.
