Item 9A. Controls and Procedures
Item 9A. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
As of December 31, 2020, management, with the participation and supervision of our Chief Executive Officer and Chief Financial Officer,
have evaluated our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Our disclosure controls and procedures are
designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms, and that such
information is accumulated and communicated to our management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.
Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control
objective and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of
December 31, 2020, the design and operation of our disclosure controls and procedures were effective at a reasonable assurance level.
Managements Annual Report on Internal Control Over Financial Reporting
This report does not include a report of managements assessment regarding internal control over financial reporting due to a transition
period established by rules of the SEC for newly public companies.
Attestation Report of the Registered Public Accounting Firm
This Annual Report on Form 10-K does not include an attestation report of our registered public
accounting firm due to an exemption established by the JOBS Act for emerging growth companies.
Changes in Internal Control Over
Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the three months
ended December
31, 2020 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information.
None.
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PART III
Item 10. Directors, Executive Officers, and Corporate Governance.
The following table sets forth information regarding our executive officers and directors as of March 1, 2021:
Executive Officers
Age
Position
Steven D. Harr, M.D.
50
President, Chief Executive Officer, and Director
Richard Mulligan, Ph.D.
66
Head of SanaX and Executive Vice-Chairman
Christian Hordo
38
Executive Vice President, Chief Business Officer
Nathan Hardy
45
Executive Vice President, Chief Financial Officer
James J. MacDonald
46
Executive Vice President, General Counsel, and
Corporate Secretary
Sunil Agarwal, M.D.
51
Executive Vice President, Head of Development and Chief Medical Officer
Non-Employee Directors
Age
Position
Joshua H. Bilenker,
M.D. (3)
49
Director
Hans
Bishop (1)(2)
56
Chairman of the Board
Douglas Cole,
M.D. (2)
60
Director
Robert
Nelsen (2)
57
Director
Alise S. Reicin, M.D.
60
Director
Michelle Seitz,
CFA (1)
55
Director
Geoffrey von Maltzahn, Ph.D.
40
Director
Mary Agnes (Maggie) Wilderotter (1)(3)
65
Director
Patrick Yang,
Ph.D. (3)
72
Director
(1)
Member of the audit committee
(2)
Member of the compensation committee
(3)
Member of the nominating and corporate governance committee
Executive Officers
Steven
D. Harr, M.D. has served as our President and Chief Executive Officer since September 2018 and has served as a member of our board of directors (Board) since October 2018. Dr. Harr was Chief Financial Officer and Head of Corporate
Development at Juno Therapeutics, Inc. (Juno), a biopharmaceutical company developing cancer immunotherapies, from April 2014 until its acquisition by Celgene in March 2018. At Juno he was responsible for the overall financial and operational
strategy of the company. Prior to Juno, Dr. Harr was Managing Director and Head of Biotechnology Investment Banking at Morgan Stanley, a public multinational investment bank and financial services company, from May 2010 until April 2014, and
prior to his investment banking role was the Lead Biotech Research Analyst and Co-head of Global Healthcare Research. Dr. Harr was a member of the board of directors of Loxo Oncology, a biopharmaceutical
company, from November 2016 until its acquisition by Eli Lilly in February 2019. Dr. Harr was also a co-founder and member of the board of directors of JW Therapeutics, a cell therapy company in China,
from February 2016 to June 2018. Dr. Harr has served on the board of Repertoire Immune Medicines, a biotechnology company, since March 2020. Dr. Harr obtained a B.A. in Economics from the College of the Holy Cross in 1993 and an M.D. from
The Johns Hopkins University School of Medicine in 1998. Dr. Harr was a resident in internal medicine at the University of California, San Francisco from 1998 to 2000. We believe Dr. Harr is qualified to serve on our Board because of his
extensive management and leadership experience with biopharmaceutical and life sciences companies.
Richard Mulligan, Ph.D.
has served as the Head of SanaX and Executive Vice-Chairman of our Board of Directors since November 2018. Dr. Mulligan is currently the Mallinckrodt Professor of Genetics, Emeritus, at Harvard Medical School, and has been Visiting Scientist at
the Massachusetts Institute of Technology since March 2017. Dr. Mulligan currently serves on the board of directors of Biogen Inc., a public biotechnology company. From 1996-2013, Dr Mulligan served as the Mallinckrodt Professor of Genetics at
Harvard and Director of the Harvard Gene Therapy Initiative. Prior to that, he was Professor of Molecular Biology at the Massachusetts Institute of Technology, and a member of the Whitehead
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Institute for Biomedical Research. From May 2013 to December 2016, Dr. Mulligan was Founding Partner and Senior Managing Director of Sarissa Capital Management LP, a registered investment
advisor, and from March 2017 to October 2018 he served as Portfolio Manager at Icahn Capital LP. We believe Dr. Mulligan is qualified to serve on our Board because of his extensive experience in the biotechnology and life sciences industries
and his substantial academic experience.
Christian Hordo has served as our Executive Vice President, Chief Business Officer
since February 2021, and previously served as our Senior Vice President, Chief Business Officer from October 2018 to February 2021. Prior to Sana, Mr. Hordo served Juno as Vice President, Myeloma Program Lead from January 2017 to October 2018
and before that as Vice President, Head of Business Development from March 2015 to April 2018. At Juno Mr. Hordo built a team and led negotiations on multiple successfully executed transactions, including the broad strategic collaboration with
Celgene. Prior to Juno, Mr. Hordo served in various roles at Genentech, most recently as Project Team Leader from December 2013 to February 2015. Christian obtained his M.B.A. from Harvard Business School, graduating with high distinction as a
Baker Scholar, a M.Sc. in medical genetics and microbiology from the University of Toronto, and a B.S. in psychology at McGill University.
Sunil Agarwal, M.D. is a co-founder of Sana and has served as our Executive Vice
President and Head of Development and Chief Medical Officer since July 2018. Dr. Agarwal is responsible for the overall strategy and execution of our pipeline, building Sanas development capabilities and helping to define and execute the
overall corporate strategy. Prior to Sana, Dr. Agarwal was the President of Research and Development at Juno from April 2017 to May 2018, where he was responsible for the overall research and development strategy and execution. Prior to Juno,
Dr. Agarwal served as partner at Sofinnova Ventures from August 2016 to April 2017. Dr. Agarwal also worked as the Chief Medical Officer and Executive Vice President of Ultragenyx Pharmaceutical Inc., a public biopharmaceutical company,
from July 2014 to August 2016, where he was responsible for managing the companys clinical development and operations, regulatory affairs, biometrics, pharmacovigilance, medical affairs, pharmacology, and toxicology functions. Dr. Agarwal
also served in various leadership roles at Genentech, Inc. (acquired by Roche Holdings, Inc.) from 2003 to 2014, including Senior Vice President and Global Head of Clinical Development for ophthalmology, metabolism, neurosciences, immunology, and
infectious diseases. Dr. Agarwal currently serves on the board of directors for Calithera Biosciences, Inc., a public biotechnology company, and previously served on the board of MyoKardia, Inc., a public biopharmaceutical company.
Dr. Agarwal completed his residency at Childrens National Medical Center (CNMC), Washington, D.C., and practiced in the CNMC Pediatric Emergency Department. He obtained a B.S. in neurobiology from Cornell University and an M.D. from Tufts
University School of Medicine.
Nathan Hardy has served as our Executive Vice President, Chief Financial Officer since
February 2021, and previously served as our Senior Vice President, Chief Financial Officer from September 2018 to February 2021. From August 2017 to June 2018, Mr. Hardy served as the Vice President of Finance at Juno where he led the Business,
Financial Planning and Treasury organizations. Mr. Hardy worked at Amgen Inc., a biopharmaceutical company, from February 2007 to August 2017, and served in a variety of senior finance and operations leadership positions, culminating as the
Executive Director and Head of Corporate Finance. At Juno and Amgen, Mr. Hardy led resource allocation activities across the organizations, helped drive large-scale business transformation at Amgen, and was part of various acquisitions and
divestitures. Prior to Amgen, Mr. Hardy held various finance positions at General Electric Co. and Sprint Corporation, a public telecommunications company. Mr. Hardy obtained a B.S. in finance from the University of Utah and an M.B.A. from
the University of Notre Dame.
James J. MacDonald has served as our Executive Vice President, General Counsel, and Corporate
Secretary since September 2018. Prior to Sana, Mr. MacDonald was Senior Vice President and Chief Intellectual Property Officer at Juno from March 2014 to May 2018, where he was responsible for all worldwide intellectual property activities,
including strategy, development, transactions, litigation and counseling. From March 2009 to March 2014, Mr. MacDonald held both legal and business roles at Tessera, Inc. (a subsidiary of Xperi Corporation) and its affiliates, a technology
company, and most recently was Executive Vice President of Intellectual Property & Business Development, responsible for business development, licensing and litigation. Prior to Tessera, Mr. MacDonald held senior roles at BigBand
Networks, a provider of platforms for broadband multimedia services (acquired by ARRIS Group), and Tumbleweed Communications, a secure internet communication solutions company (acquired by Axway), practiced law at Wilson Sonsini Goodrich &
Rosati PC in Palo Alto, California, and was a research and development engineer at The Procter & Gamble Company. Mr. MacDonald obtained a J.D. from Vanderbilt University Law School and a B.S. in chemical engineering from Stanford
University.
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Non-Employee Directors
Joshua H. Bilenker, M.D. has served as a member of our Board since December 2020. He served as Chief Executive Officer of Loxo
Oncology at Lilly, a research and development group of Eli Lilly and Company, from December 2019 to January 2021 and served as founding Chief Executive Officer of Loxo Oncology, Inc. from July 2013 until the acquisition of Loxo Oncology by Eli Lilly
in February 2019. Prior to Loxo Oncology, Dr. Bilenker joined Aisling Capital LLC in April 2006, and has served as an Operating Partner since November 2013. Previously, Dr. Bilenker served as a medical officer in the Office of Oncology
Drug Products at the FDA from August 2004 to April 2006. Dr. Bilenker serves on the board of Gossamer Bio, Inc., a public biopharmaceutical company, and previously served on the board of directors of a number of public companies including Loxo
Oncology from July 2013 until the acquisition of Loxo Oncology by Eli Lilly, ViewRay, Inc. from January 2008 to June 2017, T2 Biosystems, Inc. from August 2011 to January 2017 and Roka Bioscience, Inc. from January 2012 to March 2015.
Dr. Bilenker formerly served as a board member of the NCCN Foundation and BioEnterprise. Dr. Bilenker obtained an M.D. from the Johns Hopkins School of Medicine and an A.B. in English from Princeton University. We believe Dr. Bilenker
is qualified to serve on our Board because of his extensive experience and service as a director or officer of, and as an investor in, public biopharmaceutical and life sciences companies.
Hans E. Bishop has served as a member of our Board since October 2018. Mr. Bishop has more than 30 years of experience in
the biotechnology industry and has served as the Chief Executive Officer of GRAIL, Inc., a healthcare company, since June 2019. Mr. Bishop founded Juno in July 2013 and served as President and Chief Executive Officer until the company was
acquired by Celgene in March 2018. Prior to Juno, Mr. Bishop served as Executive in Residence at Warburg Pincus, a multinational private equity firm. Earlier in his career, Mr. Bishop served as Executive Vice President and Chief Operating
Officer for Dendreon, Inc., a public biopharmaceutical company developing cancer immunotherapies. Prior to Dendreon Mr. Bishop served as President of Specialty Medicine at Bayer Healthcare, a multinational pharmaceutical and life sciences
company, and before that served as Senior Vice President of Global Commercial Operations at Chiron Corporation, a multinational biotechnology company, where he was also Vice President and General Manager of European Biopharmaceuticals. He currently
serves as a director of Agilent Technologies, a public instrumentation manufacturing company; Lyell Immunopharma, a cellular therapy company; and JW Therapeutics. Mr. Bishop obtained a B.A. in chemistry from Brunel University in London. We
believe Mr. Bishop is qualified to serve on our Board because of his extensive management experience with the pharmaceutical and biotechnology industries and his significant academic training.
Douglas Cole, M.D. has served as a member of our Board since April 2020. Dr. Cole joined Flagship Pioneering, which
conceives, creates, resources and develops first-in-category life sciences companies, in 2001, and is currently a Managing Partner focused on life science investments.
Dr. Cole currently serves on the board of directors of Denali Therapeutics, Foghorn Therapeutics, Sigilon Therapeutics and a number of private companies. In the past five years, Dr. Cole served on the boards of directors of Quanterix
Corporation and Editas Medicine. Dr. Cole received his M.D. from the University of Pennsylvania School of Medicine and his B.A. in English from Dartmouth College. We believe Dr. Cole is qualified to sit on our board of directors given his
substantial experience as an investor in emerging biopharmaceutical and life sciences companies as well as his experience serving on the boards of directors of multiple public and private biopharmaceutical companies.
Alise S. Reicin, M.D. has served as a member of our Board since December 2020. Dr. Reicin served has served as Chief
Executive Officer and President of Tectonic Therapeutic, Inc., a biotechnology company, since August 2020. Prior to Tectonic Therapeutic, she served as President, Global Clinical Development at Celgene Corporation, a public pharmaceutical company,
from November 2018 to December 2019. Prior to Celgene, she served as Head of Global Clinical Development at EMD Serono, a pharmaceutical company, from May 2015 to October 2018 and prior to that served as Vice President, Program and Pipeline
Leadership, Oncology at Merck and Co., a public pharmaceutical company. Prior to Merck, she was a faculty member at Columbia Medical School and a physician and researcher at Columbia Presbyterian Hospital. Dr. Reicin serves on the board of
directors of Homology Medicines, Inc., a public clinical stage biopharmaceutical company. Dr. Reicin obtained an M.D. from Harvard Medical School and a B.A. in Biochemistry from Barnard College of Columbia University. We believe Dr. Reicin
is qualified to serve on our Board because of her extensive clinical expertise and leadership experience with biopharmaceutical companies.
Michelle Seitz, CFA has served as a member of our Board since December 2020. Ms. Seitz has served as Chairman and Chief
Executive Officer of Russell Investments, a global investment solutions provider, since September 2017, and as
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Chairman since January 2018. Previously, Ms. Seitz worked in various positions at William Blair, a global investment banking and wealth management firm, from February 1996 to August 2017,
most recently serving as the Chief Executive Officer of William Blair Investment Management, Chairman and President of William Blair Funds, and as a Board Member from June 2001 to August 2017. Ms. Seitz currently serves on the board of
directors of the Washington Roundtable and on the Deans Council of Kelley School of Business at Indiana University, and a member of Challenge Seattle, an alliance of chief executive officers of multinational companies within the Seattle
region. Ms. Seitz is a past director of the Financial Accounting Foundation, providing oversight of FASB and GASB. Ms. Seitz obtained a B.S. in accounting from the Indiana University Kelley School of Business and her Chartered Financial
Analyst designation in 1990. We believe Ms. Seitz is qualified to serve on our Board because of her extensive finance and industry experience and her experience serving boards of directors.
Geoffrey von Maltzahn, Ph.D. is a co-founder of Sana Biotechnology and has served as a
member of our Board since February 2019. Dr. von Maltzahn is a General Partner at Flagship Pioneering focusing on innovation and company origination and has been with Flagship since November 2009. Dr. von Maltzahn led a Flagship Labs
innovation team at Flagship Pioneering in founding Cobalt Biomedicine, where he served as its CEO and a board member, until it merged with Sana Biotechnology in February 2019. Dr. von Maltzahn currently serves as CEO and director of Tessera
Therapeutics and co-CEO of Generate Biomedicines. Previously, Dr. von Maltzahn served as Kaleidos Chief Executive Officer from 2015 to 2017 and serves on the companys board of directors.
Dr. von Maltzahn also serves as the Chief Innovation Officer and a director of Indigo Agriculture, Inc., an agriculture biotechnology company he co-founded in 2013 as part of Flagship Pioneerings
Flagship Labs innovation foundry. Dr. von Maltzahn was a co-founder of Seres Therapeutics, Inc. in 2010, and he served as Chief Technology Officer at Seres until 2012. Dr. von Maltzahn was awarded a
Ph.D. in biomedical engineering and medical physics from MIT, a M.S. in bioengineering from the University of California, San Diego, and an S.B. in chemical engineering from MIT. We believe Dr. von Maltzahn is qualified to serve on our Board
due to his extensive experience co-founding and leading numerous biotechnology companies.
Robert Nelsen has served as a member of our Board since October 2018. Mr. Nelsen has served as co-founder and Managing Director of ARCH Venture Partners, a venture capital firm focused on early-stage technology companies, since 1994, and has played a significant role in the early sourcing, financing and
development of more than 30 biopharmaceutical companies. Mr. Nelsen currently serves on the board of directors of several public biotechnology and biopharmaceutical companies including Beam Therapeutics, Denali Therapeutics Inc., Hua Medicine,
Karuna Therapeutics, Unity Biotechnology, Inc., Vir Biotechnology and several private companies, including Apex Neuro, Brii Biosciences, Inc., Encoded Genomics, Gideon Health, GRAIL, Inc., Insitro, Lyell Immunopharma, Inc., Maze Therapeutics, Inc.,
Nutcracker Therapeutics, Inc., Prime Medicine, and SciNeuro Pharmaceuticals. Mr. Nelsen previously served on the board of directors of several public biotechnology and biopharmaceutical companies including Adolor Corporation, Agios
Pharmaceuticals, Bellerophon Therapeutics, Fate Therapeutics, Illumina, Inc., Juno, KYTHERA Biopharmaceuticals, Inc., NeurogesX, Inc., Sage Therapeutics, Sienna Biopharmaceuticals, Inc., and Syros Pharmaceuticals. He also previously served as
Trustee of the Fred Hutchinson Cancer Research Center, and as a director of the National Venture Capital Association. Mr. Nelsen obtained an M.B.A. from the University of Chicago Booth School of Business and a B.S. with majors in economics and
biology from the University of Puget Sound. We believe Mr. Nelsen is qualified to serve on our Board because of his venture capital and industry experience, his extensive experience serving boards of directors of public biotechnology companies
and his significant academic experience.
Mary Agnes (Maggie) Wilderotter has served as a member of our Board since May
2020. Ms. Wilderotter has served as the Chief Executive Officer and Chairman of the Grand Reserve Inn, a luxury resort and vineyard, since August 2016. From November 2004 to April 2016, Ms. Wilderotter served in a number of roles at
Frontier Communications Corporation, a public telecommunications company, including as Executive Chairman of the board of directors from April 2015 to April 2016, Chairman and Chief Executive Officer from January 2006 to April 2015, and President,
Chief Executive Officer and director from 2004 to 2006. Ms. Wilderotter currently serves on the board of directors of Lyft, Inc., a public multinational ridesharing company; Costco Wholesale Corporation, a public wholesale retailer; Hewlett
Packard Enterprise Company, a public enterprise information technology company; and DocuSign, Inc., a public digital transaction management services company where she serves as Chairman. Ms. Wilderotter has served on many public company boards
of directors, and in the past five years, was a director of Cadence Design Systems, Inc., an electronic design automation software and engineering services company; Xerox Corporation, a document management technology solutions company; DreamWorks
Animation SKG, Inc., an entertainment company; The Procter & Gamble Company, a consumer goods company; DXC Technology Company, an IT services company; and Juno. Ms. Wilderotter obtained a
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B.A. in Economics from the College of the Holy Cross and two honorary degrees from Stevens Institute of Technology and the University of Rochester. We believe Ms. Wilderotter is qualified to
serve on our Board because of her extensive leadership experience in technology and serving as a director of public companies.
Patrick Y. Yang, Ph.D. has served as a member of our Board since October 2018. Dr. Yang served as Executive Vice President
and Special Advisor of Juno from September 2017 to January 2019. Since 2013, Dr. Yang has been a biotechnology and biopharmaceutical industry consultant. From January 2010 to March 2013, Dr. Yang served as Executive Vice President and
Global Head of Technical Operations for F. Hoffmann-La Roche Ltd. (Roche), a healthcare company, where he was responsible for the companys pharmaceutical process development, engineering, quality,
technical regulatory, supply chain, and all manufacturing plants. Before joining Roche, Dr. Yang worked for Genentech Inc., a biotechnology company; Merck & Co., a public pharmaceutical company; General Electric Co., a public
industrial company; and Life Systems, Inc., a life science research and development company; during which time he developed significant experience with pharmaceuticals and biotechnology manufacturing, engineering, technology, and supply chain
management. Dr. Yang served on the board of directors of Tesoro Corporation, a public independent petroleum refining and marketing company, from December 2010 to October 2018. He currently serves on the board of Amyris, Inc., a public
biotechnology company; Codexis Inc., a public biotechnology company; Antheia, Inc., a synthetic biology company; National Resilience, Inc., a biomanufacturing company; and PharmaEssentia, a biopharmaceutical company, and serves as Chairman at
AltruBio, Inc., a biopharmaceutical company; Acepodia, a public biotechnology company; and Archigen Biotech, a biopharmaceutical company. Dr. Yang obtained a B.S. in Engineering from the National Chiaotung University in Taiwan, a M.Sc. in
Electrical Engineering from the University of Cincinnati and a Ph.D. in engineering from the Ohio State University. We believe Dr. Yang is qualified to serve on our Board because of his extensive background and expertise in the biotechnology
industry and his previous and current experience serving as a director of various public companies.
Family Relationships
There are no family relationships among any of our executive officers or directors.
Board Structure and Composition
Director
Independence
Our board of directors currently consists of eleven members. Our board of directors has determined that all of our
directors, other than Drs. Harr and Mulligan, qualify as independent directors in accordance with the Nasdaq Stock Market LLC (Nasdaq), Marketplace Rules, or the Nasdaq Listing Rules. Drs. Harr and Mulligan are not considered independent by virtue
of their positions as executive officers of the Company. Under the Nasdaq Listing Rules, the definition of independence includes a series of objective tests, such as that the director is not, and has not been for at least three years, one of our
employees and that neither the director nor any of his or her family members has engaged in various types of business dealings with us. In addition, as required by the Nasdaq Listing Rules, our board of directors has made a subjective determination
as to each independent director that no relationships exists that, in the opinion of our board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In making these
determinations, our board of directors reviewed and discussed information provided by the directors and us with regard to each directors relationships as they may relate to us and our management.
Classified Board of Directors
In
accordance with our amended and restated certificate of incorporation, effective February 8, 2021, our board of directors is divided into three classes with staggered three-year terms. At each annual general meeting of stockholders, the
successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the third annual meeting following election. Our directors will be divided among the three classes as follows:
The Class I directors will be Drs. Cole, Harr and Yang and Ms. Seitz, and their terms will expire at
the annual meeting of stockholders to be held in 2022;
The Class II directors will be Messrs. Bishop and Mr. Nelsen, Drs. Reicin and von Maltzahn, and their
terms will expire at the annual meeting of stockholders to be held in 2023; and
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The Class III directors will be Drs. Bilenker and Mulligan and Ms. Wilderotter, and their terms will
expire at the annual meeting of stockholders to be held in 2024.
We expect that any additional directorships resulting
from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. The division of our
board of directors into three classes with staggered three-year terms may delay or prevent a change of our management or a change in control.
Leadership Structure of the Board
Our
amended and restated bylaws and corporate governance guidelines provide our board of directors with flexibility to combine or separate the positions of Chairman of the board of directors and Chief Executive Officer. Mr. Bishop currently serves
as the Chairman of the Board.
Our board of directors has concluded that our current leadership structure is appropriate at this time. However, our board
of directors will continue to periodically review our leadership structure and may make such changes in the future as it deems appropriate.
Role of
Board in Risk Oversight Process
Risk assessment and oversight are an integral part of our governance and management processes. Our
board of directors encourages management to promote a culture that incorporates risk management into our corporate strategy and day-to-day business operations.
Management discusses strategic and operational risks at regular management meetings, and conducts specific strategic planning and review sessions during the year that include a focused discussion and analysis of the risks facing us. Throughout the
year, senior management reviews these risks with the board of directors at regular board meetings as part of management presentations that focus on particular business functions, operations or strategies, and presents the steps taken by management
to mitigate or eliminate such risks.
Our board of directors does not have a standing risk management committee, but rather administers
this oversight function directly through our board of directors as a whole, as well as through various standing committees of our board of directors that address risks inherent in their respective areas of oversight. While our board of directors is
responsible for monitoring and assessing strategic risk exposure, our audit committee is responsible for overseeing our major financial risk exposures and the steps our management has taken to monitor and control these exposures. The audit committee
also approves or disapproves any related person transactions. Our nominating and corporate governance committee monitors the effectiveness of our corporate governance guidelines. Our compensation committee assesses and monitors whether any of our
compensation policies and programs has the potential to encourage excessive risk-taking.
Board Committees
Our board of directors has three standing committees: the audit committee; the compensation committee; and the nominating and corporate
governance committee. Each committee is governed by a charter that is available on our website.
Audit Committee
The members of our audit committee consist of Mary Agnes (Maggie) Wilderotter, Hans Bishop, and Michelle Seitz. Mary Agnes (Maggie) Wilderotter
is the chairperson of our audit committee. The composition of our audit committee meets the requirements for independence under the current Nasdaq listing standards and Rule 10A-3 of the Exchange Act. Each
member of our audit committee is financially literate. In addition, our board of directors has determined that Mary Agnes (Maggie) Wilderotter is an audit committee financial expert within the meaning of the SEC rules. This designation
does not impose on such directors any duties, obligations, or liabilities that are greater than are generally imposed on members of our audit committee and our board of directors. Our audit committee is directly responsible for, among other things:
appointing, retaining, compensating, and overseeing the work of our independent registered public accounting
firm;
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discussing with our independent registered public accounting firm their objectivity and independence;
reviewing with our independent registered public accounting firm the scope and results of the firms annual
audit of our financial statements;
overseeing the financial reporting process and discussing with management and our independent registered public
accounting firm the financial statements that we will file with the SEC;
pre-approving all audit and permissible
non-audit services to be performed by our independent registered public accounting firm;
reviewing policies related to risk assessment and risk management;
reviewing our accounting and financial reporting policies;
reviewing, overseeing, approving, or disapproving any related-person transactions;
reviewing with our management the scope and results of managements evaluation of our disclosure controls
and procedures and managements assessment of our internal control over financial reporting, including the related certifications to be included in the periodic reports we will file with the SEC; and
establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting,
internal controls.
Compensation Committee
The members of our compensation committee consist of Hans Bishop, Douglas Cole, M.D., and Robert Nelsen. Hans Bishop is the chairperson of our
compensation committee. Each of Hans Bishop, Douglas Cole, M.D., and Robert Nelsen is a non-employee director, as defined by Rule 16b-3 promulgated under the Exchange
Act and meets the requirements for independence under the current Nasdaq listing standard. Our compensation committee is responsible for, among other things:
reviewing and making recommendations to our board of directors regarding the compensation of executive officers;
authority to act as an administrator of our equity incentive plans;
reviewing and making recommendations to our board of directors with respect to, incentive compensation and equity
plans;
reviewing and recommending that our board of directors approve the compensation for our non-employee board members; and
establishing and reviewing general policies relating to compensation and benefits of our employees.
Nominating and Corporate Governance Committee
The members of our nominating and corporate governance committee consist of Mary Agnes (Maggie) Wilderotter, Joshua Bilenker, and Patrick Yang.
Mary Agnes (Maggie Wilderotter) is the chairperson of our nominating and corporate governance committee. Mary Agnes (Maggie) Wilderotter, Joshua Bilenker, and Patrick Yang meet the requirements for independence under the current Nasdaq listing
standards. Our nominating and corporate governance committee is responsible for, among other things:
identifying and recommending candidates for membership on our board of directors;
developing and recommending our corporate governance guidelines and policies;
reviewing and recommending changes to the leadership structure of our board of directors;
overseeing periodic self-evaluations of our board of directors and its committees; and
making recommendations to our board of directors regarding corporate governance matters.
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Code of Business Conduct and Ethics
In connection with our IPO, our board of directors adopted a code of business conduct and ethics that applies to all of our employees,
officers, and directors, including our Chief Executive Officer, Chief Financial Officer, and other executive and senior financial officers. The full text of our code of business conduct and ethics is posted on the investor relations section of our
website. We intend to disclose future amendments to our code of business conduct and ethics, or any waivers of such code, on our website or in public filings.
Compensation Committee Interlocks and Insider Participation
None of our executive officers has served as a member of a compensation committee (or if no committee performs that function, the board of
directors) of any other entity that has an executive officer serving as a member of our board of directors.
Item 11.
Executive Compensation.
This section discusses the material components of the executive compensation program for our named executive
officers (NEOs) who are named in the subsection titled 2020 Summary Compensation Table. In 2020, our NEOs and their positions were as follows:
Steven D. Harr, M.D., President and Chief Executive Officer ;
Richard Mulligan, Ph.D., Executive Vice-Chairman and Head of SanaX ; and
Christian Hordo, Senior Vice President and Chief Business Officer .
This discussion may contain forward-looking statements that are based on our current plans, considerations, expectations and determinations
regarding future compensation programs. Actual compensation programs and policies that we implement may differ materially from the currently planned programs summarized in this discussion.
As an emerging growth company as defined in the JOBS Act, we are not required to include a Compensation Discussion and Analysis
section and have elected to comply with the scaled disclosure requirements applicable to emerging growth companies.
2020 Summary Compensation Table
The following table sets forth information concerning the compensation awarded to or earned by our NEOs during our fiscal year ended
December 31, 2020.
Name and Principal Position
Year
Salary
($)
Bonus
($)
Stock
Awards
($)
Option
Awards
($) (1)
Non- Equity
Incentive
Plan
Compensation
($) (2)
All Other
Compensation
($) (3)
Total
($)
Steven D. Harr, M.D.
2020
535,000
6,015,947
294,250
6,845,197
President and Chief Executive Officer
Richard Mulligan, Ph.D.
2020
418,674
1,144,357
198,000
337,780
2,098,811
Executive Vice-Chairman and Head of
SanaX (4)
Christian Hordo
2020
350,200
1,105,346
134,827
1,590,373
Executive Vice President and Chief Business Officer
(1)
The amounts shown represent the grant date fair values of option awards granted in 2020 as computed in
accordance with Financial Accounting Standards Board (FASB) Accounting Standard Codification (ASC) Topic 718. See Note 13, Stock-based compensation to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for a discussion of the assumptions used in the calculation of these amounts.
(2)
Represents payments earned by our named executive officers upon the achievement of certain corporate performance
objectives and individual performance approved by the Board of Directors. Please see the descriptions of the annual performance bonuses paid to our named executive officers under 2020 Bonuses below.
(3)
Amount comprised of $337,780 of principal and interest accrued on a promissory note we forgave in November 2020.
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(4)
Dr. Mulligan served as a consultant prior to becoming employed as Head of SanaX in April 2020. Amount
reported in the salary column for Dr. Mulligan includes $124,443 earned while providing consulting services, in 2020.
Narrative
to Summary Compensation Table
2020 Salaries
The named executive officers receive a base salary to compensate them for services rendered to our company. The base salary payable to each
named executive officer is intended to provide a fixed component of compensation reflecting the executives skill set, experience, role and responsibilities.
For 2020, Dr. Harrs annual base salary was $535,000 and Mr. Hordos annual base salary was $350,200. Until April 23,
2020, Dr. Mulligan served as a consultant and was paid a monthly retainer of $33,333. Our board of directors established Dr. Mulligans annual base salary at $450,000 in connection with his commencement of employment with us.
2020 Bonuses
We maintain an
annual performance-based cash bonus program in which each of our named executive officers participated in 2020. Each of our named executive officers target bonus is expressed as a percentage of base salary. The 2020 annual bonuses for
Dr. Harr, Dr. Mulligan and Mr. Hordo were targeted at 50%, 40% and 35% of their respective annual base salaries, pro-rated, in the case of Dr. Mulligan, for his partial year of employment.
For 2020, our named executive officers were eligible to earn annual cash bonuses based on the achievement of certain corporate
performance objectives approved by our board of directors and its compensation committee, as well as individual performance for Dr. Mulligan and Mr. Hordo. Dr. Harrs annual cash bonus is determined solely based on certain
corporate performance objectives. In February 2021, our board of directors and its compensation committee approved the achievement of our 2020 corporate goals at 110%. Based on this level of achievement, and adjustments for individual 2020
performance for Dr. Mulligan and Mr. Hordo, the actual bonus payouts for our named executive officers are set forth above in the Summary compensation table in the column titled Non-Equity
Incentive Plan Compensation.
Until April 23, 2020, Dr. Mulligan served as a consultant to us and was eligible to earn a
discretionary fee of up to 40% of his monthly retainer for services performed in 2019. In March 2020, we paid Dr. Mulligan $160,000 based on our board of directors assessment of Dr. Mulligans service as a consultant.
Equity Compensation
We have
granted stock options to our employees, including our named executive officers, in order to attract and retain them, as well as to align their interests with the interests of our stockholders. In order to provide a long-term incentive, these stock
options generally vest over four years subject to continued service to the company.
In January 2020, we granted to Dr. Harr and
Mr. Hordo an option to purchase 590,000 and 137,500 shares of our common stock, respectively, which vest as to 25% of the shares underlying the options on February 14, 2021 and as to 1/48th of the shares underlying the options monthly
thereafter, subject to continued service.
In April 2020, in connection with his commencement of employment with us, we granted to
Dr. Mulligan an option to purchase 112,500 shares of common stock, which vests as to 25% of the shares underlying the option on April 23, 2021 and as to 1/48th of the shares underlying the option monthly thereafter, subject to continued
service.
In November 2020, we granted to Dr. Harr, Dr. Mulligan and Mr. Hordo an option to purchase 1,118,723, 200,000 and
200,000 shares of our common stock, respectively. Dr. Mulligan and Mr. Hordos options vest as to 25% of the shares underlying the options on February 15, 2022 and as to 1/48th of the shares underlying the options monthly
thereafter, subject to continued service. Dr. Harrs stock option vests (a) with respect to 50% of the shares underlying the award over a four year period with 25% vesting on February 15, 2022 and as to the remaining portion on a
monthly basis thereafter, subject to continued service through the applicable vesting date and (b) with respect to the remaining 50% of the shares underlying the award over a four year period commencing with 25% vesting on the later of the
satisfaction of certain performance conditions or February 15, 2022 and as to the remaining portion on a monthly basis following the one-year anniversary of the vesting commencement date, subject to
continued service through the applicable vesting date.
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Upon the effectiveness of our IPO on February 3, 2021, we adopted the 2021 Incentive
Award Plan, in order to facilitate the grant of cash and equity incentives to directors, employees (including our named executive officers) and consultants of our company and certain of its affiliates and to enable us to obtain and retain services
of these individuals, which is essential to our long-term success.
Other Elements of Compensation
Retirement Plans
We
maintain a tax-qualified 401(k) retirement savings plan for our employees, including our named executive officers, who satisfy certain eligibility requirements. Our named executive officers are eligible to
participate in the 401(k) plan on the same terms generally as other eligible, full-time employees. U.S. Internal Revenue Code of 1986 allows eligible employees to defer a portion of their compensation, within prescribed limits, on a pre-tax basis through contributions to the 401(k) plan. We believe that providing a vehicle for tax-deferred retirement savings though our 401(k) plan adds to the overall
desirability of our executive compensation package and further incentivizes our employees, including our named executive officers, in accordance with our compensation policies. We have not made any employer contributions under our 401(k) plan since
inception.
Employee Benefits and Perquisites
Health and Welfare Plans and Perquisites . All of our current named executive officers are eligible to participate in our employee
benefit plans, including our medical, dental, vision, disability and life insurance plans, in each case on the same basis as all of our other employees. We generally do not provide perquisites or personal benefits to our named executive officers.
No Tax Gross-Ups
We do not make gross-up payments to cover our named executive officers personal income taxes that
may pertain to any of the compensation or perquisites paid or provided by our company.
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Outstanding Equity Awards at Fiscal Year End
The following table sets forth information concerning the number of shares of common stock underlying outstanding equity incentive awards for
each named executive officer as of December 31, 2020.
Name
Vesting
Commencement
Date (1)
Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)
Number
of
Securities
Underlying
Unexercised
Options
Unexercisable
(#)
Option
Exercise
Price
($)
Option
Expiration Date
Number of
Shares or Units
of Stock not yet
Vested
(#) (2)
Market Value of
Shares or Units
not yet Vested
($) (3)
Steven D. Harr, M.D.
9/4/2018 (4)
2,612,695
(5)
38,145,347
2/14/2020
590,000
1.48
1/29/2030
2/15/2021 (6)
1,118,723
7.80
11/9/2030
Richard Mulligan Ph. D.
12/1/2018
1,499,060
21,886,276
4/23/2020
112,500
2.40
4/22/2030
2/15/2021
200,000
7.80
11/8/2030
Christian Hordo
11/19/2018
467,187
6,820,930
2/14/2020
137,500
1.48
1/26/2030
2/15/2021
200,000
7.80
11/8/2030
(1)
Except as otherwise noted, each restricted stock award and option vests as to 25% of the shares initially
underlying the option on the first anniversary of the vesting commencement date and as to 1/48th of the shares initially underlying the option each month thereafter until fully vested on the fourth anniversary of the vesting commencement date,
subject to continued service to us through the applicable vesting date.
(2)
Constitute restricted common shares that are subject to repurchase at their original purchase price upon a
termination of service. The repurchase right lapses over the vesting schedule, subject to continued service to us through the applicable vesting date.
(3)
Amounts are calculated by multiplying the number of shares shown in the table by $14.60, the estimated fair
market value of our common stock as of December 31, 2020.
(4)
The restricted shares vest as to 12.5% of the shares initially underlying the shares on the vesting commencement
date and as to 87.5% of the shares initially underlying the shares each month in equal monthly installments thereafter until fully vested on the fourth anniversary of the vesting commencement date, subject to continued service to us through the
applicable vesting date.
(5)
Includes 261,269 unvested restricted shares of Harr Family Irrevocable Trust of 2015 dtd 12/28/2015.
(6)
The stock option vests (a) with respect to 50% of the shares underlying the award over a four year period
with 25% vesting on February 15, 2022 and as to the remaining portion on a monthly basis thereafter, subject to continued service through the applicable vesting date and (b) with respect to the remaining 50% of the shares underlying the
award over a four year period commencing with 25% vesting on the later of the satisfaction of certain performance conditions or February 15, 2022 and as to the remaining portion on a monthly basis following the
one-year anniversary of the vesting commencement date, subject to continued service through the applicable vesting date.
Executive Compensation Arrangements
Below is a description of the material terms of each employment contract, agreement, plan or arrangement that provides for the employment of
and payments to our NEOs (including such payments to be made at, following or in connection with the resignation, retirement or other termination of an NEO, or following a change in control).
Steven D. Harr, M.D.
In September 2018
we entered into an offer letter with Steven D. Harr, M.D., providing for at-will employment, an annual base salary, and eligibility to participate in our employee benefit plans. In addition, Dr. Harr is
eligible to earn an annual cash bonus targeted at 50% of his base salary.
Under Dr. Harrs offer letter, upon a termination
without cause or resignation for good reason (each such term as defined below), other than during the three months prior to a change in control and ending 12 months after the change in control, Dr. Harr is entitled to receive (i) 12 months
of his base salary and target bonus and (ii) reimbursement for continued health, vision, and dental coverage through COBRA for a period of twelve months, subject Dr. Harr providing us a general release of claims. On the day of any such
termination or resignation, we may enter into a consulting agreement with Dr. Harr for a period of twelve months that provides for (i) annual consulting fees equal to his annual base salary in effect at the time of the termination or
resignation, (ii) continued vesting of equity awards held by him for a
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period of 12 months, and (iii) the right to exercise any vested stock options held by him for a period of 90 days following the term of the consulting agreement.
In the event Dr. Harrs employment with us is terminated by us without cause or he resigns for good reason during the period
commencing 3 months prior to a change in control and ending 12 months after a change in control, Dr. Harr is entitled to receive (i) his base salary in effect at the time of termination for a period of 18 months and 1.5 times his
target annual bonus, (ii) reimbursement for COBRA coverage for a period of 18 months and (iii) accelerated vesting of all equity awards held by him, subject to Dr. Harr providing a general release of claims against us.
If Dr. Harr is terminated due to his death, his estate or beneficiary shall be entitled to any unpaid bonus for a year prior to the year
of termination and a pro rata annual bonus for the year of termination, in each case, to be paid as soon as administratively practicable following the date of such termination.
For purposes of Dr. Harrs offer letter, the following terms will have the following meanings:
cause means: (i) a willful act of dishonesty made by Dr. Harr in connection with his
responsibilities as an employee; (ii) Dr. Harrs conviction of, or plea of nolo contendere to, a felony or any crime involving fraud, embezzlement or a material violation of federal or state law by him, any of which that our
board of directors reasonably determines in good faith has had or will have a material detrimental effect on the Companys reputation or business; (iii) Dr. Harrs willful and material unauthorized use or disclosure of any
proprietary information or trade secrets of the Company or any other party to whom he owes an obligation of nondisclosure as a result of his relationship with the Company; (iv) Dr. Harrs willful material breach of any obligations
under any written agreement or covenant with the Company; or (v) Dr. Harrs continued substantial failure to perform his employment duties (other than as a result of his physical or mental incapacity). No termination for cause under
(iv) or (v) shall be effectuated until after Dr. Harr has received a written demand of performance from our board of directors that specifically sets forth the factual basis for our board of directors determination that Dr. Harr
has not substantially performed his duties and has failed to cure such non-performance to our board of directors reasonable satisfaction within thirty (30) business days after receiving such notice.
For purposes of this definition, no act or failure to act shall be considered willful unless it is done in bad faith and without reasonable intent that the act or failure to act was in the best interest of the Company. Any act, or failure to act,
based upon authority or instructions given to Dr. Harr pursuant to a resolution duly adopted by our board of directors or based on the advice of counsel for the Company will be conclusively presumed to be done or omitted to be done
Dr. Harr in good faith and in the best interest of the Company.
good reason means Dr. Harrs resignation within 30 days following expiration of any Cure
Period (as defined below) following the occurrence of one or more of the following, without his written consent: (i) a material reduction in Dr. Harrs base salary or target annual bonus; (ii) a material diminution of
Dr. Harrs title, duties, responsibilities or reporting lines; (iii) a change in the location of Dr. Harrs employment of more than 50 miles; (iv) failure by the Company to timely grant certain equity awards promised in
Dr. Harrs offer letter; or (v) Dr. Harr not being elected or re-elected as a member of our board of directors. No event will be considered good reason unless (a) Dr. Harr has
given written notice to the Company of his intention to terminate his employment for good reason, describing the grounds for such action, no later than 90 days after the first occurrence of such circumstances, (b) Dr. Harr has provided the
Company with at least 30 days in which to cure the circumstances (the Cure Period), and (c) if the Company is not successful in curing the circumstance, Dr. Harr ends his employment within 30 days after the end of the Cure
Period.
Richard Mulligan, Ph.D.
In April 2020, we entered into an offer letter with Richard Mulligan, Ph.D., providing for at-will
employment, an annual base salary, and eligibility to participate in our employee benefit plans. In addition, Dr. Mulligan is eligible to earn an annual cash bonus targeted at 40% of his base salary.
Under Dr. Mulligans offer letter, upon Dr. Mulligans termination of employment by us for other than cause or his
resignation for good reason (each such term as defined below), in each case outside of the period commencing 3 months prior to a change in control and ending 12 months after a change in control, he is entitled to receive (i) nine months of base
salary and 75% of his target bonus and (ii) reimbursement for COBRA coverage for a period of nine months, subject to Dr. Mulligan providing a general release of claims against us.
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Prior to his employment with us, Dr. Mulligan served as a consultant to us pursuant to
a consulting agreement. Under the consulting agreement, Dr. Mulligan was paid a monthly retainer of $33,333 and was eligible for a discretionary fee of up to 40% of the retainer paid to him based on our board of directors assessment of
his performance under the consulting agreement.
For purposes of Dr. Mulligans offer letter, the following terms will have the
following meanings:
cause means: (i) a willful act of dishonesty made by Dr. Mulligan in connection with his
responsibilities as an employee; (ii) Dr. Mulligans conviction of, or plea of nolo contendere to, a felony or any crime involving fraud, embezzlement or a material violation of federal or state law by him, any of which that
our board of directors reasonably determines in good faith has had or will have a material detrimental effect on the Companys reputation or business; (iii) Dr. Mulligans willful and material unauthorized use or disclosure of
any proprietary information or trade secrets of the Company or any other party to whom he owes an obligation of nondisclosure as a result of his relationship with the Company; (iv) Dr. Mulligans willful material breach of any
obligations under any written agreement or covenant with the Company; or (v) Dr. Mulligans continued substantial failure to perform his employment duties (other than as a result of his physical or mental incapacity). No termination
for cause under (iv) or (v) shall be effectuated until after Dr. Mulligan has received a written demand of performance from our chief executive officer that specifically sets forth the factual basis for our chief executive officers
determination that Dr. Mulligan has not substantially performed his duties and has failed to cure such non-performance to our chief executive officers reasonable satisfaction within thirty
(30) business days after receiving such notice. For purposes of this definition, no act or failure to act shall be considered willful unless it is done in bad faith and without reasonable intent that the act or failure to act was in the best
interest of the Company. Any act, or failure to act, based upon authority or instructions given to Dr. Mulligan pursuant to a resolution duly adopted by our chief executive officer or based on the advice of counsel for the Company will be
conclusively presumed to be done or omitted to be done Dr. Mulligan in good faith and in the best interest of the Company.
good reason means Dr. Mulligans resignation within 30 days following expiration of any
Cure Period (as defined below) following the occurrence of one or more of the following, without his written consent: (i) a material reduction in Dr. Mulligans base salary or target annual bonus; (ii) a material diminution of
Dr. Mulligans title, duties, responsibilities or reporting lines; or (iii) a change in the location of Dr. Mulligans employment of more than 50 miles. No event will be considered good reason unless
(a) Dr. Mulligan has given written notice to the Company of his intention to terminate his employment for good reason, describing the grounds for such action, no later than 90 days after the first occurrence of such circumstances,
(b) Dr. Mulligan has provided the Company with at least 30 days in which to cure the circumstances (the Cure Period), and (c) if the Company is not successful in curing the circumstance, Dr. Mulligan ends his
employment within 30 days after the end of the Cure Period.
Christian Hordo
On November 9, 2018, we entered into an offer letter with Christian Hordo, providing for at-will
employment, an annual base salary, and eligibility to participate in our employee benefit plans. In addition, Christian Hordo is eligible to earn an annual cash bonus targeted at 35% of his base salary.
Under Mr. Hordos offer letter, upon Mr. Hordos termination of employment by us for other than cause or his resignation
for good reason (each such term as defined below), in each case outside of the period commencing 3 months prior to a change in control and ending 12 months after a change in control, he is entitled to receive (i) nine months of base salary and
75% of his target bonus and (ii) reimbursement for COBRA coverage for a period of nine months, subject to Mr. Hordo providing a general release of claims against us.
For purposes of Mr. Hordos offer letter, the following terms will have the following meanings:
cause means: (i) a willful act of dishonesty made by Mr. Hordo in connection with his
responsibilities as an employee; (ii) Mr. Hordos conviction of, or plea of nolo contendere to, a felony or any crime involving fraud, embezzlement or a material violation of federal or state law by him, any of which that our
board of directors reasonably determines in good faith has had or will have a material detrimental effect on the Companys
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reputation or business; (iii) Mr. Hordos willful and material unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any other party to
whom he owes an obligation of nondisclosure as a result of his relationship with the Company; (iv) Mr. Hordos willful material breach of any obligations under any written agreement or covenant with the Company; or
(v) Mr. Hordos continued substantial failure to perform his employment duties (other than as a result of his physical or mental incapacity). No termination for cause under (iv) or (v) shall be effectuated until after
Mr. Hordo has received a written demand of performance from our chief executive officer that specifically sets forth the factual basis for our chief executive officers determination that Mr. Hordo has not substantially performed his
duties and has failed to cure such non-performance to our chief executive officers reasonable satisfaction within thirty (30) business days after receiving such notice. For purposes of this
definition, no act or failure to act shall be considered willful unless it is done in bad faith and without reasonable intent that the act or failure to act was in the best interest of the Company. Any act, or failure to act, based upon authority or
instructions given to Mr. Hordo pursuant to a resolution duly adopted by our chief executive officer or based on the advice of counsel for the Company will be conclusively presumed to be done or omitted to be done Mr. Hordo in good faith
and in the best interest of the Company.
good reason means Mr. Hordos resignation within 30 days following expiration of any Cure
Period (as defined below) following the occurrence of one or more of the following, without his written consent: (i) a material reduction in Mr. Hordos base salary or target annual bonus; (ii) a material diminution of
Mr. Hordos title, duties, responsibilities or reporting lines; or (iii) a change in the location of Mr. Hordos employment of more than 50 miles; or (iv) failure by the Company to timely grant certain equity awards
promised in Mr. Hordos offer letter. No event will be considered good reason unless (a) Mr. Hordo has given written notice to the Company of his intention to terminate his employment for good reason, describing the grounds for
such action, no later than 90 days after the first occurrence of such circumstances, (b) Mr. Hordo has provided the Company with at least 30 days in which to cure the circumstances (the Cure Period), and (c) if the Company
is not successful in curing the circumstance, Mr. Hordo ends his employment within 30 days after the end of the Cure Period.
Change in Control Severance Plan
Each of
Dr. Mulligan and Mr. Hordo are eligible to participate in our change in control severance plan. Under the change in control severance plan, in the event the executives employment with us is terminated by us without cause or he
resigns for good reason during the period commencing 3 months prior to a change in control and ending 12 months after a change in control, the executive is entitled to receive (i) his base salary in effect at the time of termination for a
period of 12 months and 1 times his target annual bonus, (ii) reimbursement for COBRA coverage for a period of 12 months and (iii) accelerated vesting of all equity awards held by him, subject to the executive providing a general release
of claims against us.
For purposes of our change in control severance plan the following terms have the following meanings:
cause means the occurrence of any of the following: (a) an act of dishonesty made by the
applicable executive in connection with such executives responsibilities as an employee; (b) the applicable executives conviction of, or plea of nolo contendere to, a felony or any crime involving fraud, embezzlement or any
other act of moral turpitude, or a material violation of federal or state law by such executive that our board of directors reasonably determines has had or will have a material detrimental effect on the Companys reputation or business;
(c) the applicable executives gross misconduct; (d) the applicable executives willful and material unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any other party to whom the
applicable executive owes an obligation of nondisclosure as a result of the applicable executives relationship with the Company; (e) the applicable executives willful breach of any material obligations under any written agreement or
covenant with the Company; or (f) the applicable executives continued substantial failure to perform such executives employment duties (other than as a result of such executives physical or mental incapacity) after such
executive has received a written demand of performance from our chief executive officer or such executives supervisor that specifically sets forth the factual basis for our chief executive officers or such executives
supervisors determination that the applicable executive has not substantially performed such executives duties and has failed to cure such non-performance to our chief executive officers or
such executives supervisors reasonable satisfaction within 30 business days after receiving such notice. No act or
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failure to act shall be considered willful unless it is done in bad faith and without reasonable intent that the act or failure to act was in the best interest of the Company or required by law.
Any act, or failure to act, based upon authority or instructions given to the applicable executive pursuant to a direct instruction from our chief executive officer or based on the advice of counsel for the Company will be conclusively presumed to
be done or omitted to be done by the applicable executive in good faith and in the best interest of the Company.
good reason means, the applicable executives resignation within 30 days following the end of
the Cure Period (as defined below), without the applicable executives express written consent, of one or more of the following: (a) a material reduction by the Company in the applicable executives then-current annual base salary;
(b) a material diminution of the applicable executives authority, duties, or responsibilities relative to the applicable executives authority, duties, or responsibilities in effect immediately prior to such reduction; (c) a
change in the location of the applicable executives employment of more than 50 miles; or (d) the Companys material breach of the terms of any material written agreement or covenant with the applicable executive related to the
applicable executives provision of services to the Company. In order for an event to qualify as good reason, the applicable executive must not terminate employment with the Company without first providing the Company with written notice of the
acts or omissions constituting the grounds for good reason within 90 days of the initial existence of the grounds for good reason and a reasonable cure period of 30 days following the date of written notice (the Cure
Period), and such grounds must not have been cured during such time.
Director Compensation
2020 Director Compensation Program
Historically, our directors have not received compensation for their service. The following table contains information concerning the
compensation of our non-employee directors in 2020:
Name (1)
Fees Earned
or Paid in
Cash
($)
Stock
Awards
($)
Option
Awards
($) (2)
All Other
Compensation
($)
Total
($)
Hans E. Bishop
Robert Nelsen
Mary Agnes (Maggie) Wilderotter
140,363
140,363
Michelle Seitz
456,766
456,766
Joshua H. Bilenker, M.D.
456,766
456,766
Alise S. Reicin, M.D.
456,766
456,766
Geoffrey von Maltzahn, Ph.D.
Patrick Y. Yang, Ph.D.
Douglas Cole, M.D.
(1)
Steven D. Harr, M.D., our President and Chief Executive Officer, and Richard Mulligan, Ph.D, our Executive
Vice-Chairman and Head of SanaX, are not included in this table as they are employees of the company. All compensation paid to Drs. Harr and Mulligan for the period they served as directors during 2020 is reflected in the section titled
2020 Summary Compensation Table.
(2)
The amounts shown represent the grant date fair values of option awards granted in 2020 as computed in
accordance with FASB ASC Topic 718. See Note 13, Stock-based compensation to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for a discussion of the assumptions used
in the calculation of these.
Our Director Compensation Program was effective upon the effectiveness of our IPO on
February 3, 2021. Pursuant to the Director Compensation Program, our non-employee directors will receive cash compensation as follows:
Each non-employee director will receive an annual cash retainer in the
amount of $40,000 per year.
Any Non-Executive Chairperson will receive an additional annual cash
retainer in the amount of $30,000 per year.
The chairperson of the audit committee will receive additional annual cash compensation in the amount of $20,000
per year for such chairpersons service on the audit committee. Each non-chairperson member of the audit committee will receive additional annual cash compensation in the amount of $10,000 per year for
such members service on the audit committee.
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The chairperson of the compensation committee will receive additional annual cash compensation in the amount of
$15,000 per year for such chairpersons service on the compensation committee. Each non-chairperson member of the compensation committee will receive additional annual cash compensation in the amount of
$7,500 per year for such members service on the compensation committee.
The chairperson of the nominating and corporate governance committee will receive additional annual cash
compensation in the amount of $10,000 per year for such chairpersons service on the nominating and corporate governance committee. Each non-chairperson member of the nominating and corporate governance
committee will receive additional annual cash compensation in the amount of $5,000 per year for such members service on the nominating and corporate governance committee.
Each non-employee director may also elect to receive all or part of his
or her annual cash retainer in the form of restricted stock units under our 2021 Incentive Award Plan. Elections to convert all or a portion of the annual cash retainer into restricted stock units must generally be made on or prior to
December 31 of the year prior to the year in which the annual cash retainer is scheduled to be paid, or such earlier deadline as established by our board of directors or compensation committee. Each individual who first becomes a non-employee director is permitted to elect to convert the annual cash retainer payments scheduled to be paid in the same calendar year into restricted stock units, provided that the election is made prior to the
date the individual becomes a non-employee director. Restricted stock units granted in lieu of all or a portion of the annual cash retainer are issued fully vested on the date of grant, and have a grant date
fair value equal to the amount of the applicable portion of the annual cash retainer.
Additionally, if permitted by our board of directors or the compensation committee, non-employee directors may elect to defer all or part of the settlement of their restricted stock units issuable in lieu of all or a portion of the annual cash retainer. Any such deferral election is subject to the
rules, conditions and procedures as determined by our board of directors or the compensation committee in its sole discretion, which are intended to comply with the requirements of Section 409A of the Internal Revenue Code. Timing of the
settlement of any deferred restricted stock units is made in accordance with the terms of the applicable deferral election.
Under the Director Compensation Program, each non-employee director will automatically be granted
(i) an option to purchase that number of shares of our common stock calculated by dividing (a) $700,000 by (b) the per share grant date fair value of the option, calculated based on the closing trading price of our common stock as of
the date of grant (or if the date of grant is not a trading day, the immediately preceding trading day) and using assumptions published in our most recent periodic report as of the date of grant, rounded down to the nearest whole share, upon the
directors initial appointment or election to our board of directors, referred to as the Initial Grant, and (ii) for each non-employee director who has served for at least four months as of the
date of each annual stockholders meeting, an option to purchase that number of shares of our common stock calculated by dividing (a) $350,000 by (b) the per share grant date fair value of the option, calculated based on the closing
trading price of our common stock as of the date of grant (or if the date of grant is not a trading day, the immediately preceding trading day) and using assumptions published in our most recent periodic report as of the date of grant, rounded down
to the nearest whole share, automatically on the date of each annual stockholders meeting thereafter, referred to as the Annual Grant. The Initial Grant will vest and become exercisable as to 1/36th of the underlying shares on a monthly basis
over three years, subject to continued service through each applicable vesting date. The Annual Grant will vest and become exercisable on the first anniversary of the date of grant, provided, that if our annual stockholders meeting immediately
following the date of grant takes place prior to the first anniversary of the date of grant, the Annual Grant will vest and become exercisable immediately prior to our annual stockholders meeting following the date of grant, subject to
continued service through each applicable vesting date.
In the event of a change in control (as defined in the Director Compensation
Policy), each Initial Option and Annual Option, along with any other stock options or equity-based awards held by any non-employee director, will vest and become exercisable immediately prior to such change in
control.
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Item 12. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters.
The following table provides information on our equity compensation plans as of December 31,
2020. Information is included for equity compensation plans approved by our stockholders.
Name
Number of Securities
to be Issued upon
Exercise of
Outstanding Options
Weighted-Average
Exercise Price of
Outstanding Options
Number of Securities
Remaining Available for
Future Issuance under
Equity Compensation Plans
Equity compensation plans approved by security holders (1)
15,667,001
$
4.52
234,065
(1)
Consists of options outstanding and available for issuance under our 2018 Equity Incentive Plan.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information regarding beneficial ownership of our common stock as of March 1, 2021 by:
each person whom we know to beneficially own more than 5% of our common stock;
each of our directors;
each of our named executive officers; and
all directors and executive officers as a group.
In accordance with the rules of the SEC, beneficial ownership includes voting or investment power with respect to securities and includes the
shares issuable pursuant to stock options that are exercisable within 60 days of March 1, 2021. Shares issuable pursuant to stock options are deemed outstanding for computing the percentage of the person holding such options but are not
outstanding for computing the percentage of any other person.
We based our calculation of the percentage of beneficial ownership on
187,459,905 shares of our common stock outstanding as of March 1, 2021. Unless otherwise indicated, the address for each listed stockholder is: c/o Sana Biotechnology, Inc., 188 East Blaine Street, Suite 400, Seattle, Washington
98102. To our knowledge, except as indicated in the footnotes to this table and pursuant to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares of common stock.
Name of Beneficial Owner
Number of
Shares
Beneficially
Owned
Percentage of
Shares
Beneficially
Owned
(%)
Greater than 5% Owner:
Entities affiliated with ARCH Venture
Partners (1)
44,042,500
23.5
Entities affiliated with Flagship Pioneering
Funds (2)
34,239,018
18.3
CPP Investment Board PMI-1 Inc. (3)
9,375,000
5.0
Named Executive Officers and Directors:
Robert Nelsen (4)
44,042,500
23.5
Steven D. Harr, M.D. (5)
9,028,333
4.8
Hans E. Bishop (6)
5,736,250
3.1
Richard Mulligan, Ph.D. (7)
3,026,246
1.6
Geoffrey von Maltzahn, Ph.D. (8)
1,830,610
1.0
Christian Hordo (9)
1,015,104
*
Patrick Y. Yang, Ph.D. (10)
146,250
*
Douglas Cole, M.D.
*
Mary Agnes (Maggie) Wilderotter
*
Michelle Seitz
*
Joshua H. Bilenker, M.D.
*
Alise S. Reicin, M.D
*
All executive officers and directors as a group (15 persons)
67,771,645
36.2
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*
Less than 1%.
(1)
Consists of (i) 10,303,750 shares of common stock held by ARCH Venture Fund IX, L.P. (ARCH IX); (ii) 10,301,250
shares of common stock held by ARCH Venture Fund IX, Overage L.P. (ARCH IX Overage); (iii) 11,718,750 shares of common stock held by ARCH Venture Fund X, L.P. (ARCH X); (iv) 11,718,750 shares of common stock held by ARCH Venture Fund X Overage, L.P.
(ARCH X Overage). ARCH Venture Partners IX, L.P. (AVP IX LP) is the sole general partner of ARCH IX. ARCH Venture Partners IX Overage, L.P. (AVP IX Overage LP) is the sole general partner of ARCH IX Overage. ARCH Venture Partners IX, LLC (AVP IX
LLC) is the sole general partner of each of AVP IX LP and AVP IX Overage LP. Keith Crandell, Clinton Bybee, and Robert Nelsen are managing directors of AVP IX LLC (the AVP IX MDs). AVP IX LP and AVP IX Overage LP may be deemed to beneficially own
the shares held by ARCH IX and ARCH IX Overage, respectively, AVP IX LLC may be deemed to beneficially own the shares held by ARCH IX and ARCH IX Overage, and each of the AVP IX MDs may be deemed to share the power to direct the disposition and vote
of the shares held by ARCH IX and ARCH IX Overage. AVP IX LP, AVP IX Overage LP, AVP IX LLC, and the AVP IX MDs each disclaim beneficial ownership except to any pecuniary interest therein. ARCH Venture Partners X, L.P. (AVP X LP) is the sole general
partner of ARCH X. ARCH Venture Partners X Overage, L.P. (AVP X Overage LP) is the sole general partner of ARCH X Overage. ARCH Venture Partners X, LLC (AVP X LLC) is the sole general partner of each of AVP X LP and AVP X Overage LP. Keith Crandell,
Kristina Burow, Steven Gilles and Robert Nelsen comprise the investment committee of AVP X LLC (the AVP X Committee Members). AVP X LP and AVP X Overage LP may be deemed to beneficially own the shares held by ARCH X and ARCH X Overage, respectively,
AVP X LLC may be deemed to beneficially own the shares held by ARCH X and ARCH X Overage, and each of the AVP X Committee Members may be deemed to share the power to direct the disposition and vote of the shares held by ARCH X and ARCH X Overage.
AVP X LP, AVP X Overage LP, AVP X LLC, and the AVP X Committee Members each disclaim beneficial ownership except to any pecuniary interest therein.
(2)
Consists of (i) 11,585,199 shares of common held by Flagship Ventures Fund V, L.P. (Flagship Fund V), (ii)
11,441,326 shares of common held by Flagship VentureLabs V LLC (VentureLabs V), (iii) 9,725,122 shares of common stock held by Flagship Pioneering Fund VI, L.P. (Flagship Pioneering VI), and (iv) 1,487,371 shares of common stock held by Flagship V
VentureLabs Rx Fund, L.P. (Flagship Fund V Rx and, together with Flagship Pioneering VI, Flagship Fund V and VentureLabs V, the Flagship Pioneering Funds). Flagship Fund V is a member of VentureLabs V. VentureLabs V Manager LLC (VentureLabs V
Manager) is the manager of VentureLabs V. Flagship Pioneering, Inc. (Flagship Pioneering) is the manager of VentureLabs V Manager. The General Partner of Flagship Pioneering VI is Flagship Pioneering Fund VI General Partner LLC (Flagship Pioneering
VI GP). The manager of Flagship Pioneering VI GP is Flagship Pioneering. The General Partner of Flagship Fund V and Flagship Fund V Rx is Flagship Ventures Fund V General Partner LLC (Flagship V GP and, together with VentureLabs V Manager, Flagship
Pioneering, and Flagship Pioneering VI GP, the Flagship General Partners). Noubar B. Afeyan, Ph.D. is the sole Director of Flagship Pioneering and may be deemed to have sole voting and investment control over all the shares held by VentureLabs V and
Flagship Fund VI. In addition, Noubar B. Afeyan, Ph.D. serves as the sole manager of Flagship V GP and may be deemed to possess sole voting and investment control over all the shares held by Flagship Fund V and Flagship Fund V Rx. None of the
Flagship General Partners nor Noubar B. Afeyan, Ph.D. directly own any of the shares held by the Flagship Pioneering Funds, and each of the Flagship General Partners and Dr. Noubar Afeyan, Ph.D. disclaims beneficial ownership of such shares
except to the extent of its or his pecuniary interest therein. The mailing address of the Flagship Funds is 55 Cambridge Parkway, Suite 800E, Cambridge, MA 02142.
(3)
Consists of 9,375,000 shares of common stock. CPP Investment Board PMI-1
Inc. (CPPIB) is a wholly owned subsidiary of Canada Pension Plan Investment Board. Canada Pension Plan Investment Board is overseen by a board of directors. None of the directors of that board of directors has sole voting or dispositive power with
respect to the shares of the common stock owned by CPPIB. The mailing address of each of CPPIB and Canada Pension Plan Investment Board is c/o Canada Pension Plan Investment Board, One Queen Street East, Suite 2500, Toronto, ON, M5C 2W5.
(4)
Mr. Nelsen is an AVP IX MD and an AVP X Committee Member and may be deemed to beneficially own the shares
held by, ARCH IX, ARCH IX Overage, ARCH X, and ARCH X Overage as discussed in footnote (1). Mr. Nelsen disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein, if any.
(5)
Consists of (i) 2,031,250 shares of common stock; (ii) 6,142,500 shares of restricted common stock of which
4,015,019 had vested as of March 1, 2021 and which remaining unvested portion remains subject to repurchase; (iii) 682,500 shares of restricted common stock held by the Harr Family Irrevocable Trust of 2015 dtd 12/28/2015, of which 446,113 had
vested as of March 1, 2021 and which remaining unvested portion remains subject to repurchase; and (iv) 172,083 shares of common stock issuable upon exercise of stock options held by Dr. Harr that are exercisable within 60 days of
March 1, 2021.
(6)
Consists of (i) 2,031,250 shares of common stock; (ii) 3,705,000 shares of restricted common stock of which
2,701,562 had vested as of March 1, 2021 and which remaining unvested portion remains subject to repurchase.
(7)
Consists of 2,998,121 shares of restricted common stock of which 1,686,443 had vested as of March 1, 2021
and which remaining unvested portion remains subject to repurchase; and (ii) 28,125 shares of common stock issuable upon exercise of stock options held by Dr. Mulligan that are exercisable within 60 days of March 1, 2021.
(8)
Consists of 1,830,610 shares of common stock of which 732,244 are held by Maxine Sharkey Giammo and 366,122 are
held by Geoffrey A. von Maltzahn 2020 GRAT.
(9)
Consists of (i) 975,000 shares of restricted common stock of which 548,437 had vested as of March 1, 2021
and which remaining unvested portion remains subject to repurchase; (ii) 40,104 shares of common stock issuable upon exercise of stock options held by Mr. Hordo that are exercisable within 60 days of March 1, 2021.
(10)
Consists of 146,250 shares of restricted common stock of which 94,453 had vested as of March 1, 2021 and
which remaining unvested portion remains subject to repurchase.
Item 13. Certain Relationships and
Related Transactions, and Director Independence.
The following includes a summary of transactions since January 1, 2020) and any
currently proposed transactions, to which we were or are to be a participant, in which (i) the amount involved exceeded or will exceed $120,000; and (ii) any of our directors, executive officers or holders of more than 5% of our capital
stock, or any affiliate or member of the
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Index to Financial Statements
immediate family of the foregoing persons, had or will have a direct or indirect material interest, other than compensation and other arrangements that are described under the section titled
Executive and Director Compensation above.
We believe the terms obtained or consideration that we paid or received, as
applicable, in connection with the transactions described below were comparable to terms available or the amounts that we would pay or receive, as applicable, in arms-length transactions.
Series B Convertible Preferred Stock Financing
In June 2020, we issued an aggregate of 27,223,170 shares of Series B convertible preferred stock at $16.00 per share for gross proceeds of
$435.6 million pursuant to our Series A-2 and Series B convertible preferred stock purchase agreement we originally entered into in February 2019.
The table below sets forth the number of shares of our Series A-1, Series A-2 and Series B convertible preferred stock purchased by our executive officers, directors, holders of more than 5% of our capital stock and their affiliated entities or immediate family members. Each share of
Series A-1, Series A2 and Series B convertible preferred stock in the table below converted into one share of our common stock upon the completion of our IPO.
Name
Series A-1
Convertible
Preferred
Stock
Series A-2
Convertible
Preferred
Stock
Series B
Convertible
Preferred
Stock
Aggregate
Purchase Price
(in thousands)
Entities affiliated with ARCH Venture
Partners (1)
7,375,000
30,125,000
6,250,000
$
250,000
Entities affiliated with Flagship Pioneering
Funds (2)
34,239,018
CPP Investment Board PMI-1 Inc.
4,166,667
5,208,333
100,000
F-Prime Fund VI (3)
1,750,000
5,750,000
625,000
40,000
Steven D. Harr, M.D.
1,075,000
800,000
156,250
10,000
Hans E. Bishop
1,075,000
800,000
156,250
10,000
Geoffrey von Maltzahn, Ph.D. (2)
1,830,610
James J. MacDonald (4)
93,750
7,812
500
(1)
Robert Nelsen, a member of our board of directors, was designated to our board by ARCH Venture Partners. For
further details, see the information provided in footnote (1) to the table in the section titled Security Ownership of Certain Beneficial Qwners and Management and Related Stockholder Matters.
(2)
Series A-2 convertible preferred stock issued in connection with the
acquisition of Cobalt. Douglas Cole, M.D. and Geoffrey von Maltzahn, Ph.D., members of our board of directors, were designated to our board by the Flagship Pioneering Funds.
(3)
F-Prime Advisors is the general partner of F-Prime Fund VI. F-Prime Advisors is solely managed by Impresa Management LLC, the managing member of its general partner and its investment manager. Impresa Management LLC is
owned, directly or indirectly, by various shareholders and employees of FMR LLC. Stephen Knight, M.D., a former member of our board of directors affiliated with these entities, resigned in October 2020.
(4)
The 7,812 shares of Series B convertible preferred stock are held by the The James J. MacDonald and Rena Chng
Trust, dated January 15, 2010, which are deemed beneficially owned by Mr. MacDonald.
Relationship with Richard Mulligan, Ph.D.
In December 2018, Dr. Mulligan became a member of our board of directors and we entered into a consulting agreement pursuant to
which Dr. Mulligan provided general advisory services to us in exchange for an annual fee of $400,000, paid monthly and was eligible to receive a bonus of $160,000 paid annually.
Dr. Mulligan received 2,998,121 restricted shares of common stock, vesting 25% at the one-year
anniversary and monthly thereafter, subject to Dr. Mulligan remaining a service provider. Additionally, we issued a promissory note to Dr. Mulligan, for a principal amount of $0.3 million, with an interest rate of 3.0% per annum. In
April 2020, Dr. Mulligan became an employee and his consulting relationship ended. In November 2020, the promissory note and accrued interest of $0.3 million was forgiven by the board of directors and the promissory note was extinguished.
For further description of Dr. Mulligans compensation, see the subsection titled Executive CompensationExecutive Compensation Arrangements.
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Index to Financial Statements
Other Transactions
We have entered into offer letter agreements with our executive officers that, among other things, provide for certain compensatory and change
in control benefits, as well as severance benefits. For a description of these agreements with our named executive officers, see the subsection titled Executive CompensationExecutive Compensation Arrangements.
We have also granted stock options and restricted stock to our executive officers and certain of our directors. For a description of these
equity awards, see the subsection titled Executive CompensationEquity Compensation.
Director and Officer Indemnification
We have entered into indemnification agreements with certain of our current directors and executive officers.
Our amended and restated certificate of incorporation also provides that, to the fullest extent permitted by law, we will indemnify any
officer or director of our company against all damages, claims, and liabilities arising out of the fact that the person is or was our director or officer, or served any other enterprise at our request as a director or officer. Amending this
provision will not reduce our indemnification obligations relating to actions taken before an amendment.
Related Person Transaction Policy
We have a written related-person transaction policy that applies to our executive officers, directors, director nominees, holders of more than
five percent of any class of our voting securities, and any member of the immediate family of, and any entity affiliated with, any of the foregoing persons. Such persons will not be permitted to enter into a related person transaction with us
without the prior consent of our audit committee, or other independent members of our board of directors in the event it is inappropriate for our audit committee to review such transaction due to a conflict of interest. Any request for us to enter
into a transaction with an executive officer, director, director nominee, principal stockholder, or any of their immediate family members or affiliates, in which the amount involved exceeds $120,000 must first be presented to our audit committee for
review, consideration, and approval. In approving or rejecting any such proposal, our audit committee will consider the relevant facts and circumstances available and deemed relevant to our audit committee, including, but not limited to, the
commercial reasonableness of the terms of the transaction and the materiality and character of the related persons direct or indirect interest in the transaction. All of the transactions described in this section occurred prior to the adoption
of this policy.
Item 14. Principal Accounting Fees and Services.
The following table sets forth all fees billed for professional audit services and other services rendered by Ernst & Young LLP for
the years ended December 31, 2020 and 2019.
Twelve Months Ended December 31,
2020
2019
(in thousands)
Audit fees (1)
$
1,728
$
302
Audit-related fees (2)
-
-
Tax fees (3)
169
31
All other fees (2)
-
-
Total
$
1,897
$
333
(1)
Audit fees consist of fees billed for professional services by Ernst & Young LLP for the audit of our
annual financial statements, the review of interim financial statements, the review of our registration statement on Form S-1 for our initial public offering, and related services that are normally provided
with statutory and regulatory filings or engagements.
(2)
There were no audit-related fees or other fees incurred in 2020 or 2019.
(3)
Tax fees consist of fees for professional services, including tax, consulting, and compliance.
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Index to Financial Statements
Pre-Approval Policies and Procedures
Before an independent registered public accounting firm is engaged to render audit or non-audit
services, our audit committee must review the terms of the proposed engagement and pre-approve the engagement. The audit committee may delegate authority to one or more of the members of the audit committee to
provide such pre-approvals for audit or non-audit services, provided that such person or persons report such pre-approvals to the
full audit committee at its next scheduled meeting. During our 2020 and 2019 fiscal years, all services provided by Ernst & Young LLP were pre-approved by our audit committee.
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PART IV
Item 15. Exhibits, Financial Statement Schedules.
Exhibit Index
Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Date
Number
Filed
Herewith
3.1
Amended and Restated Certificate of Incorporation
8-K
02/09/2021
3.1
3.2
Amended and Restated Bylaws
8-K
02/09/2021
3.2
3.3
Compensatory Arrangements of Certain Officers
8-K
03/02/2021
4.1
Reference is made to Exhibits 3.1 through 3.2
4.2
Form of Common Stock Certificate
S-1/A
01/28/2021
4.2
4.3
Description of Securities Registered Pursuant to Section 12 of the Securities and Exchange Act of 1934, as amended
X
10.1
Amended and Restated Investors Rights Agreement, dated February
13, 2019, by and among the Registrant and the investors listed therein
S-1
01/13/2021
10.1
10.2
Form of Indemnification Agreement for directors and officers
S-1/A
01/28/2021
10.2
10.3(a)#
2018 Equity Incentive Plan, as amended
S-1
01/13/2021
10.3(a)
10.3(b)#
First Amendment to 2018 Equity Incentive Plan, dated November 9, 2020
S-1
01/13/2021
10.3(b)
10.3(c)#
Second Amendment to 2018 Equity Incentive Plan, dated December 4, 2020
S-1
01/13/2021
10.3(c)
10.3(d)#
Form of Stock Option Agreement under 2018 Equity Incentive Plan
S-1
01/13/2021
10.3(d)
10.4(a)#
2021 Incentive Award Plan
S-1/A
01/28/2021
10.4(a)
10.4(b)#
Form of Stock Option Grant Notice and Stock Option Agreement under the 2021 Incentive Award Plan
S-1/A
01/28/2021
10.4(b)
10.4(c)#
Form of Restricted Stock Award Grant Notice and Restricted Stock Award Agreement under the 2021 Incentive Award Plan
S-1/A
01/28/2021
10.4(c)
10.4(d)#
Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the 2021 Incentive Award Plan
S-1/A
01/28/2021
10.4(d)
10.5#
Employee Stock Purchase Plan
S-1/A
01/28/2021
10.5
10.6#
Offer Letter and Employment Agreement by and between the Registrant and Steven D. Harr, M.D., dated as of September 27,
2018
S-1
01/13/2021
10.6
10.7#
Offer Letter and Employment Agreement by and between the Registrant and Richard Mulligan, Ph.D., dated as of April 23,
2020
S-1
01/13/2021
10.7
10.8#
Offer Letter and Employment Agreement by and between the Registrant and Christian Hordo, dated as of November 10, 2018
S-1
01/13/2021
10.8
10.9#
Offer Letter and Employment Agreement by and between the Registrant and Nathan Hardy, dated as of October 8, 2018
S-1
01/13/2021
10.9
10.10#
Offer Letter and Employment Agreement by and between the Registrant and James J. MacDonald, dated as of October 2,
2018
S-1
01/13/2021
10.10
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Index to Financial Statements
Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Date
Number
Filed
Herewith
10.11#
Non-Employee Director Compensation Program
S-1/A
01/28/2021
10.11
10.12(a)
License Agreement, effective as of February
17, 2016, by and between Flagship Pioneering Innovations V, Inc. (Flagship Innovations V) and Cobalt Biomedicine, Inc. (Cobalt)
S-1
01/13/2021
10.12(a)
10.12(b)
First Amendment to License Agreement, dated as of February 14, 2019, by and between Flagship Innovations V and Cobalt
S-1
01/13/2021
10.12(b)
10.13(a)
Patents Sub-License Agreement, dated August
16, 2018, by and between La Societe Pulsalys (Pulsalys) and Cobalt
S-1
01/13/2021
10.13(a)
10.13(b)
Amendment No. 1 to Patents Sub-License Agreement, dated May
26, 2020, by and between Pulsalys and Cobalt
S-1
01/13/2021
10.13(b)
10.14
Exclusive License Agreement, dated March
22, 2019, by and between the Registrant and the Regents of the University of California (The Regents) acting through the Technology Development Group of the University of California, Los Angeles (UCLA)
S-1
01/13/2021
10.14
10.15(a)
License Agreement, dated as of March
19, 2019, by and between the Registrant and President and Fellows of Harvard College (Harvard)
S-1
01/13/2021
10.15(a)
10.15(b)
Amendment No. 1 to License Agreement, dated as of June 10, 2019, by and between the Registrant and Harvard
S-1
01/13/2021
10.15(b)
10.15(c)
Amendment No. 2 to License Agreement, dated as of December 15, 2020, by and between the Registrant and Harvard
S-1
01/13/2021
10.15(c)
10.16(a)
Exclusive License Agreement, effective on January
2, 2019, by and between the Registrant and The Regents, acting through its Office of Technology Management, University of California San Francisco (UCSF)
S-1
01/13/2021
10.16(a)
10.16(b)
Amendment No. 1 to Exclusive License Agreement, effective on December 3, 2020, by and between the Registrant and
UCSF
S-1
01/13/2021
10.16(b)
10.17
Exclusive License Agreement, effective on November 14, 2019, by and between the Registrant and Washington University
S-1
01/13/2021
10.17
10.18
Exclusive License Agreement, effective on September 1, 2020, by and between the Registrant and Washington University
S-1
01/13/2021
10.18
10.19
Amended and Restated Exclusive Patent License Agreement, dated September
10, 2020, by and among the Registrant, Oscine Corp., and University of Rochester
S-1
01/13/2021
10.19
10.20(a)
Seed Bank Supply Agreement, dated as of July
9, 2018, by and between Oscine Therapeutics (U.S.) Inc. (Oscine Affiliate) and Hadasit Medical Research Services and Development Ltd. (Hadasit)
S-1
01/13/2021
10.20(a)
10.20(b)
Amendment No. 1 to Seed Bank Supply Agreement, dated as of July
9, 2018, by and among the Registrant, Oscine Affiliate, and Hadasit
S-1
01/13/2021
10.20(b)
10.20(c)
Amendment No. 2 to Seed Bank Supply Agreement, dated as of January
6, 2021, by and among the Registrant, Oscine Affiliate, and Hadasit
S-1
01/13/2021
10.20(c)
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Index to Financial Statements
Incorporated by Reference
Exhibit
Number
Exhibit Description
Form
Date
Number
Filed
Herewith
10.21(a)
Exclusive Start-Up License Agreement, effective on October
9, 2018, by and between Cytocardia, Inc. (Cytocardia) and the University of Washington, acting through UW CoMotion (UW)
S-1
01/13/2021
10.21(a)
10.21(b)
Amendment No. 1 to Exclusive Start-Up
License Agreement, effective on November 6, 2019, by and between Cytocardia and UW
S-1
01/13/2021
10.21(b)
10.21(c)
Amendment No. 2 to Exclusive Start-Up License Agreement, effective on July
16, 2020, by and between Cytocardia and UW
S-1/a
01/28/2021
10.21(c)
10.21(d)
Assignment of Exclusive Start-Up License Agreement, effective on November
11, 2020, by and among UW, Cytocardia and the Registrant
S-1
01/13/2021
10.21(c)
10.21(e)
Amendment No. 4 to Exclusive Start-Up License Agreement, effective on January
21, 2021 by and between the Registrant and UW
S-1/a
01/28/2021
10.21(e)
10.22#
Offer Letter and Employment Agreement by and between the Registrant and Sunil Agarwal, M.D., dated as of May 20, 2019
S-1
01/13/2021
10.22
10.23
Non-Exclusive License and Development Agreement by and between the Registrant and Fujifilm Cellular
Dynamics, Inc., effective on February 1, 2021
S-1/a
02/02/2021
10.23
21.1
List of Subsidiaries
X
23.1
Consent of Independent Registered Public Accounting Firm
X
24.1
Power of Attorney (reference is made to the signature page)
X
31.1
Certificate of Principle Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
31.2
Certificate of Principle Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
X
32.1*
Certificate of Principle Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
32.2*
Certificate of Principle Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
X
#
Indicates management contract or compensatory plan.
Certain portions of this document that constitute confidential information have been redacted in accordance with
Regulation S-K, Item 601(b)(10).
*
The certification attached as Exhibit 32.1 and Exhibit 32.2 that accompany this Annual Report on Form 10-K is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange
Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing.
Item 16. Form 10-K Summary
None.
216
Table of Contents
Index to Financial Statements
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused
this Report to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Seattle, State of Washington on the 25 th day of March 2021 .
SANA BIOTECHNOLOGY, INC.
/s/ Steven D. Harr, M.D.
Name:
Steven D. Harr, M.D.
Title:
President and Chief Executive Officer
(Principal Executive Officer)
/s/ Nathan Hardy
Name:
Nathan Hardy
Title:
Chief Financial Officer
(Principal Financial and
Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been
signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Steven D. Harr, M.D.
Chief Executive Officer and Director (Principal Executive Officer)
March 24, 2021
Steven D. Harr, M.D.
/s/ Nathan Hardy
Chief Financial Officer (Principal Financial and Accounting Officer)
March 24, 2021
Nathan Hardy
/s/ Hans E. Bishop
Chairman of the Board
March 24, 2021
Hans E. Bishop
/s/ Joshua H. Bilenker, M.D.
Director
March 24, 2021
Joshua H. Bilenker, M.D.
/s/ Douglas Cole, M.D.
Director
March 24, 2021
Douglas Cole, M.D.
/s/ Richard Mulligan, Ph.D.
Director
March 24, 2021
Richard Mulligan, Ph.D.
/s/ Robert Nelsen
Director
March 24, 2021
Robert Nelsen
/s/ Alise S. Reicin, M.D.
Director
March 24, 2021
Alise S. Reicin, M.D.
/s/ Michelle Seitz
Director
March 24, 2021
Michelle Seitz
/s/ Geoffrey von Maltzahn, Ph.D.
Director
March 24, 2021
Geoffrey von Maltzahn, Ph.D.
217
Table of Contents
Index to Financial Statements
Signature
Title
Date
/s/ Mary Agnes (Maggie) Wilderotter
Director
March 24, 2021
Mary Agnes (Maggie) Wilderotter
/s/ Patrick Y. Yang, Ph.D.
Director
March 24, 2021
Patrick Y. Yang, Ph.D.
218