17 unchanged sentences
Other Information.
+Added: With respect to our “at-the-market” program, on March 11, 2021, we entered into a new sales agreement with Cantor relating to sales, from time to time, of the Company’s common stock up to an aggregate of $75.0 million.
+Added: We will also file a new universal shelf registration statement on Form S-3, including an “at the market” prospectus relating to the foregoing, with the SEC after the filing of this Annual Report on Form 10-K.
+Added: Prior to the effectiveness of our new universal shelf registration statement on Form S-3, we intend to file an Amendment to this Annual Report on Form 10-K to present the information required by Part III of Form 10-K.
+Added: Our existing sales agreement with Cantor, dated December 3, 2018, will terminate automatically at such time as the SEC declares effective our new universal shelf registration statement on Form S-3.
Directors, Executive Officers and Corporate Governance.
−Removed: Set forth below are the names of our directors, their ages, their offices in the Company, if any, their principal occupations or employment for at least the past five years, the length of their tenure as directors and the names of other public companies in which such persons hold or have held directorships during the past five years.
−Removed: Additionally, information about the specific experience, qualifications, attributes or skills that led to our Board of Directors’ conclusion that each person listed below should serve as a director is set forth below:
−Removed: Position with the Company
−Removed: Milind Deshpande, Ph.D.
−Removed: Chairman of the Board of Directors
−Removed: Jean-François Formela, M.D.
−Removed: Ankit Mahadevia, M.D.
−Removed: Chief Executive Officer, President and Director
−Removed: Pottage, Jr., M.D.
−Removed: Cynthia Smith
−Removed: Patrick Vink, M.D.
−Removed: Our Board of Directors has reviewed the materiality of any relationship that each of our directors has with Spero Therapeutics, Inc., either directly or indirectly.
−Removed: Based upon this review, our Board of Directors has determined that the following members of the Board of Directors are “independent directors” as defined by The Nasdaq Stock Market:
−Removed: Milind Deshpande, Ph.D., Jean-François Formela, M.D., John C.
−Removed: Pottage, Jr., M.D., Cynthia Smith, Frank E.
−Removed: Thomas, and Patrick Vink, M.D.
−Removed: See “Item 13.
−Removed: Certain Relationships and Related Transactions, and Director Independence.”
−Removed: Milind Deshpande, Ph.D.
−Removed: has served on our Board of Directors since January 2014 and currently serves as chairman of our Board of Directors.
−Removed: Deshpande is the President and Chief Executive Officer at Nayan Therapeutics since February 2019, and President & CEO of Avilar Therapeutics since January 2020.
−Removed: He is also a Venture Partner at RA Capital, where he has served since October 2018.
−Removed: Deshpande joined Achillion Pharmaceuticals, Inc.
−Removed: in September 2001 as Vice President of Chemistry, was named Head of Drug Discovery in April 2002, Senior Vice President of Drug Discovery in December 2002, Senior Vice President and Chief Scientific Officer in December 2004 and Executive Vice President of Research and Chief Scientific Officer in June 2007.
−Removed: He was promoted to President of Research and Development in October 2010.
−Removed: In May 2013, Dr.
−Removed: Deshpande was appointed President and Chief Executive Officer of Achillion and joined its board of directors on which he served until May 2018.
−Removed: Prior to joining Achillion, Dr.
−Removed: Deshpande was Associate Director of Lead Discovery and Early Discovery Chemistry at the Pharmaceutical Research Institute at Bristol-Myers Squibb Co.
−Removed: from 1991 to 2001, where he managed the identification of new clinical candidates to treat infectious and neurological diseases.
−Removed: From 1988 to 1991, he held a faculty position at Boston University Medical School.
−Removed: Deshpande received his Ph.D.
−Removed: in Organic Chemistry from Ohio University, following his undergraduate education in India.
−Removed: We believe that Dr.
−Removed: Deshpande is qualified to serve on our Board of Directors due to his extensive experience in the life sciences industry.
−Removed: Jean-François Formela, M.D.
−Removed: has served on our Board of Directors since March 2013.
−Removed: Formela is currently a partner at Atlas Venture and focuses on novel drug discovery approaches and therapeutics.
−Removed: He joined Atlas Venture in 1993 to build the U.S.
−Removed: life sciences franchise.
−Removed: He is a director and co-founder of IFM Therapeutics, Intellia Therapeutics (Nasdaq:
−Removed: NTLA), Korro Bio, Triplet Therapeutics and Translate Bio (Nasdaq:
−Removed: Jean-François also serves on the boards of F-star and Ikena Oncology.
−Removed: His prior investments include Adnexus, ArQule (Nasdaq:
−Removed: ARQL), Arteaus Therapeutics (acquired by Eli Lilly), CoStim Pharmaceuticals (acquired by Novartis), deCODE (Nasdaq:
−Removed: DCGN), Exelixis (Nasdaq:
−Removed: EXEL) and NxStage (Nasdaq:
−Removed: Formela is a member of the Partners Healthcare Innovation Advisory Board and a former trustee of the Boston Institute of Contemporary Art.
−Removed: He received his M.D.
−Removed: from Paris University School of Medicine and his M.B.A.
−Removed: from Columbia University.
−Removed: We believe Dr.
−Removed: Formela’s experience in the life sciences industry, as well as his practice of medicine, provides him with the qualifications and skills to serve as a director of our Company.
−Removed: Ankit Mahadevia, M.D.
−Removed: has served as our Chief Executive Officer and President since March 2015 and has been a member of our Board of Directors since September 2013.
−Removed: He was formerly a Venture Partner in the life sciences group at Atlas Venture, located in Cambridge, Massachusetts.
−Removed: In that capacity he supported the formation of eight companies focused on novel drug discovery platforms and therapeutic products, including Nimbus Therapeutics, Arteaus Therapeutics (acquired by Lilly), and Translate Bio (Nasdaq:
−Removed: He led three of these companies as acting CEO, including Synlogic (Nasdaq:
−Removed: Prior to joining Atlas Venture in 2008, Dr.
−Removed: Mahadevia worked on product and business development with the founding team at Arcion Therapeutics, Inc.
−Removed: He has also held positions in business development both at Genentech, Inc.
−Removed: and at Vanda Pharmaceuticals Inc.
−Removed: Previously, he worked in the health care groups of McKinsey & Company and Monitor Group.
−Removed: Mahadevia began his career in health care policy, with roles in the U.S.
−Removed: Senate Health, Education, Labor, and Pensions committees, the U.S.
−Removed: Government Accountability Office and the Mexican Institute of Social Security.
−Removed: He has spoken widely on entrepreneurship, including at Harvard Univesity, Columbia University, Northwestern University, and the Berkeley Forum.
−Removed: Mahadevia has also been active in the policy of life science innovation, including service on the Advisory Council at the NIH National Center for Advancing Translational Sciences.
−Removed: Mahadevia holds an M.D.
−Removed: from the Johns Hopkins School of Medicine, an M.B.A.
−Removed: from the Wharton School at the University of Pennsylvania and a B.A.
−Removed: in Economics and Biology from Northwestern University.
−Removed: We believe that Dr.
−Removed: Mahadevia is qualified to serve on our Board of Directors due to his experience serving as our Chief Executive Officer and President and his extensive experience in the life sciences industry.
−Removed: Pottage, Jr., M.D.
−Removed: has served on our Board of Directors since September 2018.
−Removed: Pottage served as Senior Vice President and Chief Scientific and Medical Officer of ViiV Healthcare from November 2009 to October 2019.
−Removed: From September 2008 to November 2009, Dr.
−Removed: Pottage served as Senior Vice President, Head of Infectious Disease Medicine Development Center and, from June 2007 to September 2008, as the Vice President, Global Clinical Development of Antivirals, at GlaxoSmithKline.
−Removed: Prior to joining GlaxoSmithKline, Dr.
−Removed: Pottage served as Chief Medical Officer and Senior Vice President of Drug Development of Achillion Pharmaceuticals from May 2002 to May 2007.
−Removed: From July 1998 to May 2002, Dr.
−Removed: Pottage served as Medical Director of Vertex Pharmaceuticals.
−Removed: We believe that Dr.
−Removed: Pottage’s extensive industry and executive experience, his broad experience within the biopharmaceutical sector and his knowledge of the life sciences industry qualifies him to serve on our Board of Directors.
−Removed: Cynthia Smith has served on our Board of Directors since March 2019.
−Removed: Smith was Chief Commercial Officer of ZS Pharma, from June 2013 to December 2016.
−Removed: ZS Pharma became a subsidiary of AstraZeneca after its acquisition in December 2015.
−Removed: Prior to joining ZS Pharma, Ms.
−Removed: Smith was Vice President, Market Access & Commercial Development at Affymax, Inc., a biotechnology company focused on the development and commercialization of novel renal therapies, including a new anemia drug for chronic kidney disease patients.
−Removed: Smith was employed at Affymax from October 2008 to March 2013.
−Removed: Prior to Affymax, Ms.
−Removed: Smith was Executive Director of Healthcare System and Medicare Strategy at Merck.
−Removed: During her tenure at Merck from June 2000 to October 2008, she also held various leadership positions in corporate strategy, public policy, and external affairs, including global crisis management for the Vioxx recall.
−Removed: Before joining the pharmaceutical industry, she served in the White House Office of Management and Budget (OMB) in the Clinton Administration.
−Removed: Smith earned an MBA from the Wharton School of the University of Pennsylvania, an MS in public policy from the Eagleton Institute of Politics at Rutgers University, and a BA from the University of North Carolina at Chapel Hill.
−Removed: Smith also serves on the boards of directors of Dicerna Pharmaceuticals and Akebia Therapeutics.
−Removed: We believe that Ms.
−Removed: Smith’s extensive management experience in the healthcare industry and her experience as a member of the board of directors of other publicly traded biotechnology companies, as well as her broad life sciences industry knowledge, qualifies her to serve on our Board of Directors.
−Removed: Thomas has served on our Board of Directors since July 2017.
−Removed: Thomas is currently Chief Operating Officer and Chief Financial Officer of Orchard Therapeutics, a development-stage biotechnology company based in the United Kingdom, where he served as Chief Financial Officer and Chief Business Officer from January 2018 to December 2019.
−Removed: Prior to Orchard, Mr.
−Removed: Thomas served as the President and Chief Operating Officer of AMAG Pharmaceuticals, Inc., a publicly traded commercial-stage pharmaceutical company, from April 2015 to April 2017, as AMAG’s Executive Vice President and Chief Operating Officer from May 2012 through April 2015 and as Executive Vice President, Chief Financial Officer and Treasurer from August 2011 through May 2012.
−Removed: Prior to AMAG, he served as Senior Vice President, Chief Operating Officer and Chief Financial Officer for Molecular Biometrics, Inc., a commercial-stage medical diagnostics company, from October 2008 to July 2011.
−Removed: Prior to Molecular Biometrics, Mr.
−Removed: Thomas spent four years at Critical Therapeutics, Inc., a public biopharmaceutical company, from April 2004 to March 2008, where he was promoted to President in June 2006 and Chief Executive Officer in December 2006 from the position of Senior Vice President and Chief Financial Officer.
−Removed: He also served on the board of directors of Critical Therapeutics from 2006 to 2008.
−Removed: Prior to 2004, Mr.
−Removed: Thomas served as the Chief Financial Officer and Vice President of Finance and Investor Relations at Esperion Therapeutics, Inc., a public biopharmaceutical company.
−Removed: Thomas was a member of the board of directors of the Massachusetts Biotechnology Council from 2007 to 2015 and currently serves as a member of the board of directors of Zafgen, Inc., a public biopharmaceutical company, which he joined in June 2014.
−Removed: Thomas holds a B.B.A.
−Removed: from the University of Michigan, Ann Arbor.
−Removed: We believe that Mr.
−Removed: Thomas’ extensive commercial and operational management experience at biopharmaceutical companies and with financial matters qualifies him to serve on our Board of Directors.
−Removed: Patrick Vink, M.D.
−Removed: has served on our Board of Directors since September 2015.
−Removed: Vink has been an advisor to the pharmaceutical industry since 2015 and non-executive board member of several companies.
−Removed: Previously, Dr.
−Removed: Vink was employed at Cubist Pharmaceuticals, Inc.
−Removed: Most recently, he served as Executive Vice-President and Chief Operating Officer, overseeing all worldwide commercial and technical operations as well as global alliance management and managing the company’s profit and loss.
−Removed: He joined Cubist in 2012 as Senior Vice-president and Head of all International Business Operations.
−Removed: In this role, he was responsible for the all business activities in International markets outside USA.
−Removed: Prior to joining Cubist, Dr.
−Removed: Vink served as Senior Vice President, Global Head of Hospital Business and Global Head of Biologics for Mylan Inc.
−Removed: In this role, Dr.
−Removed: Vink managed the global hospital business of the company.
−Removed: He joined Mylan in 2008 and established a number of global functions for the company in Switzerland.
−Removed: Before joining Mylan, Dr.
−Removed: Vink held several leadership positions across the industry, including Head of Global Business Franchise Biopharmaceuticals for Novartis Sandoz;
−Removed: Vice-President International Business for Biogen, Inc.;
−Removed: and Head of Worldwide Marketing, Cardiovascular and Thrombosis for Sanofi-Synthélabo SA.
−Removed: Vink served as a member of the Executive Committee of the European Federation of Pharmaceutical Industries and Associations (EFPIA) between 2013 and 2015.
−Removed: Vink graduated as a medical doctor from the University of Leiden, Netherlands in 1988 and obtained his M.B.A.
−Removed: in 1992 from the University of Rochester.
−Removed: Vink serves on the boards of directors of Santhera Pharmaceuticals AG, Amryt Pharma PLC., and is Chairman of the board of directors of Targovax Oy, Acacia Pharma and two privately held companies.
−Removed: We believe that Dr.
−Removed: Vink is qualified to serve on our Board of Directors because of his extensive operational business experience, significant knowledge of the activities of our company, and diverse background serving on the board of directors of various public and private life science companies.
−Removed: Term of Office of Directors
−Removed: Our amended and restated By-Laws provide that our business is to be managed by or under the direction of our Board of Directors.
−Removed: Our Board of Directors is divided into three classes for purposes of election.
−Removed: One class is elected at each annual meeting of stockholders to serve for a three-year term.
−Removed: Our Board of Directors currently consists of seven members, classified into three classes as follows:
−Removed: Milind Deshpande, Ph.D., Jean-François Formela, M.D.
−Removed: and Ankit Mahadevia, M.D.
−Removed: constitute our Class III directors with a term ending at the 2020 annual meeting;
−Removed: Cynthia Smith and John C.
−Removed: Pottage, Jr., M.D.
−Removed: constitute our Class I directors with a term ending at the 2021 annual meeting;
−Removed: Patrick Vink, M.D.
−Removed: Thomas constitute our Class II directors with a term ending at the 2022 annual meeting.
−Removed: Committees of the Board of Directors and Meetings
−Removed: Meeting Attendance.
−Removed: During the fiscal year ended December 31, 2019, there were four meetings of our Board of Directors, and the various committees of the Board of Directors met a total of nine times.
−Removed: No director attended fewer than 75% of the total number of meetings of the Board of Directors and of committees of the Board of Directors on which he served during fiscal 2019.
−Removed: The Board of Directors has adopted a policy under which each member of the Board of Directors makes every effort to but is not required to attend each annual meeting of our stockholders.
−Removed: Audit Committee .
−Removed: Our Audit Committee met four times during fiscal 2019.
−Removed: This committee currently has three members, Frank E.
−Removed: Thomas (Chairman), John C.
−Removed: Pottage, Jr., M.D., and Patrick Vink, M.D.
−Removed: Our Audit Committee’s role and responsibilities are set forth in the Audit Committee’s written charter and include the authority to retain and terminate the services of our independent registered public accounting firm.
−Removed: In addition, the Audit Committee reviews annual financial statements, considers matters relating to accounting policy and internal controls and reviews the scope of annual audits.
−Removed: All members of the Audit Committee satisfy the current independence standards promulgated by the Securities and Exchange Commission and by The Nasdaq Stock Market, as such standards apply specifically to members of audit committees.
−Removed: The Board of Directors has determined that Mr.
−Removed: Thomas is an “audit committee financial expert,” as the Securities and Exchange Commission has defined that term in Item 407 of Regulation S-K.
−Removed: Please also see the report of the Audit Committee set forth elsewhere in this proxy statement.
−Removed: A copy of the Audit Committee’s written charter is publicly available on our website at www.sperotherapeutics.com.
−Removed: Compensation Committee.
−Removed: Our Compensation Committee met four times during fiscal 2019.
−Removed: This committee currently has four members, Patrick Vink, M.D.
−Removed: (Chairman), Jean-François Formela, M.D., Milind Deshpande, Ph.D., and Cynthia Smith.
−Removed: Our Compensation Committee’s role and responsibilities are set forth in the Compensation Committee’s written charter and includes reviewing, approving and making recommendations regarding our compensation policies, practices and procedures to ensure that legal and fiduciary responsibilities of the Board of Directors are carried out and that such policies, practices and procedures contribute to our success.
−Removed: Our Compensation Committee also administers the Spero Therapeutics, Inc.
−Removed: 2017 Stock Incentive Plan, as amended, or the 2017 Plan.
−Removed: The Compensation Committee is responsible for the determination of the compensation of our chief executive officer, and shall conduct its decision making process with respect to that issue without the chief executive officer present.
−Removed: All members of the Compensation Committee qualify as independent under the definition promulgated by The Nasdaq Stock Market.
−Removed: The Compensation Committee engaged Pearl Meyer & Partners, LLC (“Pearl Meyer”) as an independent advisor to the Compensation Committee providing executive compensation consulting services.
−Removed: Pearl Meyer was engaged by and reports solely to the Compensation Committee.
−Removed: The Compensation Committee has the sole authority to approve the terms of the engagement.
−Removed: Pearl Meyer did not provide any services to the Company other than executive compensation consulting services during fiscal year 2019.
−Removed: In compliance with the SEC and the corporate governance rules of The Nasdaq Stock Market, Pearl Meyer provided the Compensation Committee with a letter addressing each of the six independence factors.
−Removed: Their responses affirm the independence of Pearl Meyer and the partners, consultants, and employees who service the Compensation Committee on executive compensation matters and governance issues.
−Removed: A copy of the Compensation Committee’s written charter is publicly available on our website at www.sperotherapeutics.com.
−Removed: Nominating and Corporate Governance Committee .
−Removed: Our Nominating and Corporate Governance Committee (“Nominating Committee”) met once during fiscal 2019 and has three members, Milind Deshpande, Ph.D.
−Removed: (Chairman), Jean-François Formela, M.D., and Frank E.
−Removed: Our Board of Directors has determined that all members of the Nominating Committee qualify as independent under the definition promulgated by The Nasdaq Stock Market.
−Removed: The Nominating Committee’s responsibilities are set forth in the Nominating Committee’s written charter and include:
−Removed: identifying and recommending candidates for membership on our Board of Directors;
−Removed: recommending directors to serve on board committees;
−Removed: reviewing and recommending our corporate governance guidelines and policies;
−Removed: reviewing proposed waivers of the code of conduct for directors and executive officers;
−Removed: evaluating, and overseeing the process of evaluating, the performance of our Board of Directors and individual directors;
−Removed: assisting our Board of Directors on corporate governance matters.
−Removed: Generally, our Nominating Committee considers candidates recommended by stockholders as well as from other sources such as other directors or officers, third party search firms or other appropriate sources.
−Removed: Once identified, the Nominating Committee will evaluate a candidate’s qualifications in accordance with the criteria set forth in our Corporate Governance Guidelines.
−Removed: Our Nominating Committee has not adopted a formal diversity policy in connection with the consideration of director nominations or the selection of nominees.
−Removed: However, the Nominating Committee will consider issues of diversity among its members in identifying and considering nominees for director, and strive where appropriate to achieve a diverse balance of backgrounds, perspectives, experience, age, gender, ethnicity and country of citizenship on the Board of Directors and its committees.
−Removed: If a stockholder wishes to propose a candidate for consideration as a nominee for election to the Board of Directors, it must follow the procedures described in our amended and restated By-Laws and in “Stockholder Proposals and Nominations For Director” at the end of this proxy statement.
−Removed: Any such recommendation should be made in writing to the Nominating and Governance Committee, care of our Secretary at our principal office and should be accompanied by the following information concerning each recommending stockholder and the beneficial owner , if any, on whose behalf the nomination is made:
−Removed: all information relating to such person that would be required to be disclosed in a proxy statement;
−Removed: certain biographical and share ownership information about the stockholder and any other proponent, including a description of any derivative transactions in the Company’s securities;
−Removed: a description of certain arrangements and understandings between the proposing stockholder and any beneficial owner and any other person in connection with such stockholder nomination;
−Removed: a statement whether or not either such stockholder or beneficial owner intends to deliver a proxy statement and form of proxy to holders of voting shares sufficient to carry the proposal.
−Removed: The recommendation must also be accompanied by the following information concerning the proposed nominee:
−Removed: certain biographical information concerning the proposed nominee;
−Removed: all information concerning the proposed nominee required to be disclosed in solicitations of proxies for election of directors;
−Removed: certain information about any other security holder of the Company who supports the proposed nominee;
−Removed: a description of all relationships between the proposed nominee and the recommending stockholder or any beneficial owner, including any agreements or understandings regarding the nomination;
−Removed: additional disclosures relating to stockholder nominees for directors, including completed questionnaires and disclosures required by our amended and restated By-Laws.
−Removed: Corporate Governance Guidelines .
−Removed: Our Board of Directors has adopted corporate governance guidelines, which apply to our principal executive officer, our principal financial and accounting officer and all of our other employees, to assist in the exercise of its duties and responsibilities and to serve the best interests of our Company and our stockholders.
−Removed: The guidelines provide that:
−Removed: our Board of Directors’ principal responsibility is to oversee the management of our Company;
−Removed: except as required by Nasdaq rules, a majority of the members of our Board of Directors must be independent directors;
−Removed: the independent directors meet in executive session at least twice a year;
−Removed: directors have full and free access to management and, as necessary, independent advisors;
−Removed: our nominating and corporate governance committee will oversee periodic self-evaluations of the Board of Directors to determine whether it and its committees are functioning effectively.
−Removed: We have no formal policy regarding diversity of our board members, but our Corporate Governance Guidelines provide that the background and qualifications of the members of our Board of Directors considered as a group should provide a significant breadth of experience, knowledge, and ability to assist our Board of Directors in fulfilling its responsibilities.
−Removed: Our priority in selection of board members is identification of members who will further the interests of our stockholders through their established records of professional accomplishment, the ability to contribute positively to the collaborative culture among our board members, knowledge of our business, understanding of the competitive landscape in which we operate and adherence to high ethical standards.
−Removed: Copies of the Nominating Committee’s written charter and our Corporate Governance Guidelines are publicly available on the Company’s website at www.sperotherapeutics.com .
−Removed: Code of Conduct and Ethics.
−Removed: We have adopted a Code of Business Conduct and Ethics that applies to all of our employees, including our chief executive officer and chief financial and accounting officers.
−Removed: The text of the Code of Business Conduct and Ethics is posted on our website at www.sperotherapeutics.com and will be made available to stockholders without charge, upon request, in writing to the Secretary of the Company at Spero Therapeutics, Inc., 675 Massachusetts Avenue, 14th Floor, Cambridge, Massachusetts 02139.
−Removed: Disclosure regarding any amendments to, or waivers from, provisions of the Code of Business Conduct and Ethics that apply to our directors, principal executive and financial officers will be included in a Current Report on Form 8-K within four business days following the date of the amendment or waiver, unless website posting or the issuance of a press release of such amendments or waivers is then permitted by the rules of The Nasdaq Stock Market.
−Removed: Compensation Committee Interlocks and Insider Participation.
−Removed: None of the members of our Compensation Committee has at any time during the prior three years been one of our officers or employees.
−Removed: None of our executive officers currently serves, or in the past fiscal year has served, as a member of our Board of Directors or Compensation Committee of any entity that has one or more executive officers serving on our Board of Directors or Compensation Committee.
−Removed: For a description of transactions between us and members of our Compensation Committee and affiliates of such members, see “Certain Relationships and Related Person Transactions.”
−Removed: Board Leadership Structure and Role in Risk Oversight
−Removed: The Company’s Board of Directors is currently chaired by Milind Deshpande, Ph.D..
−Removed: As a general policy, our Board of Directors believes that separation of the positions of chairman and chief executive officer reinforces the independence of our Board of Directors from management, creates an environment that encourages objective oversight of management’s performance and enhances the effectiveness of our Board of Directors as a whole.
−Removed: Mahadevia serves as our Chief Executive Officer while Dr.
−Removed: Deshpande serves as the chairman of our Board of Directors but is not an officer.
−Removed: Our Board of Directors oversees the management of risks inherent in the operation of our business and the implementation of our business strategies.
−Removed: Our Board of Directors performs this oversight role by using several different levels of review.
−Removed: In connection with its reviews of the operations and corporate functions of our Company, our Board of Directors addresses the primary risks associated with those operations and corporate functions.
−Removed: In addition, our Board of Directors reviews the risks associated with the Company’s business strategies periodically throughout the year as part of its consideration of undertaking any such business strategies.
−Removed: Each of our board committees also oversees the management of the Company’s risk that falls within the committee’s areas of responsibility.
−Removed: In performing this function, each committee has full access to management, as well as the ability to engage advisors.
−Removed: Our Chief Executive Officer reports to the Audit Committee and is responsible for identifying, evaluating and implementing risk management controls and methodologies to address any identified risks.
−Removed: In connection with its risk management role, our Audit Committee meets privately with representatives from our independent registered public accounting firm and our Chief Executive Officer.
−Removed: The Audit Committee oversees the operation of our risk management program, including the identification of the primary risks associated with our business and periodic updates to such risks, and reports to our Board of Directors regarding these activities.
−Removed: Stockholder Communications to the Board of Directors
−Removed: Generally, stockholders who have questions or concerns should contact our Investor Relations department at 857-242-1547 or ir@sperotherapeutics.com.
−Removed: However, any stockholders who wish to address questions regarding our business directly with the Board of Directors, or any individual director, should direct his or her questions in writing to the Chairman of the Board of Directors at Spero Therapeutics, Inc., 675 Massachusetts Avenue, 14th Floor, Cambridge, Massachusetts 02139.
−Removed: Communications will be distributed to the Board of Directors, or to any individual director or directors as appropriate, depending on the facts and circumstances outlined in the communications.
−Removed: Items that are unrelated to the duties and responsibilities of the Board of Directors may be excluded, such as:
−Removed: junk mail and mass mailings
−Removed: resumes and other forms of job inquiries
−Removed: solicitations or advertisements
−Removed: In addition, any material that is unduly hostile, threatening, or illegal in nature may be excluded, provided that any communication that is filtered out will be made available to any outside director upon request.
−Removed: Executive Officers
−Removed: The following table sets forth certain information regarding our executive officers who are not also directors.
−Removed: We have employment agreements or consulting agreements with each of our executive officers.
−Removed: Chief Financial Officer (Interim)
−Removed: Cristina Larkin
−Removed: Chief Operating Officer
−Removed: David Melnick, M.D.
−Removed: Chief Medical Officer
−Removed: Thomas Parr Jr., Ph.D.
−Removed: Chief Scientific Officer
−Removed: Timothy Keutzer
−Removed: Chief Development Officer
−Removed: On September 4, 2019, Mr.
−Removed: Joel Sendek notified us of his resignation as as the Company’s Chief Financial Officer to pursue another opportunity closer to his home.
−Removed: Sendek’s resignation was effective on November 8, 2019.
−Removed: Sendek’s resignation was not as a result of any disagreement with our Board of Directors or any matter related to our operations, product candidates, policies or practices.
−Removed: DiPalma has served as our interim Chief Financial Officer and Treasurer since November 2019.
−Removed: He is a Managing Director of Danforth Advisors, LLC, a financial consultancy that specializes in working with life sciences companies.
−Removed: Prior to and during his tenure at Danforth, Mr.
−Removed: DiPalma has served as interim Chief Financial Officer to several public and emerging companies in various stages of development.
−Removed: DiPalma joined Danforth in 2014 and served as Chief Financial Officer at Forum Pharmaceuticals from 2009 to 2014.
−Removed: He holds a B.S.
−Removed: from the University of Massachusetts and M.B.A.
−Removed: from Babson College.
−Removed: Cristina Larkin has served as our Chief Operating Officer since September 2017 and had previously served as our Chief Commercial Officer since March 2016.
−Removed: Larkin has over 26 years of experience developing strategic commercial insights for biopharmaceutical companies and their infectious disease products such as Avycaz®, Dalvance®, Teflaro®, Levaquin® and Floxin®.
−Removed: Prior to joining us, Ms.
−Removed: Larkin founded CLC Insights, LLC.
−Removed: Prior to that, since 2004, she worked at Actavis, plc, formerly Forest Laboratories, Inc., where she served in various positions, including Assistant Vice President from 2014 to 2015.
−Removed: During that time, Ms.
−Removed: Larkin led the commercial hospital antibiotic franchise team and was responsible for the U.S.
−Removed: launch and execution strategy for several antibiotics.
−Removed: Additionally, she was a member of the business assessments and business development team and played an integral role in several strategic ventures, including the out-licensing of ceftaroline to AstraZeneca plc and the acquisition of Durata.
−Removed: From 1996 to 2002, Ms.
−Removed: Larkin served in various roles at Ortho-McNeil Pharmaceutical, LLC.
−Removed: Larkin received a bachelor’s degree from Florida State University.
−Removed: David Melnick, M.D.
−Removed: has served as our Chief Medical Officer since January 2018.
−Removed: Prior to joining Spero, Dr.
−Removed: Melnick served as Vice President of Clinical Development for Anti-Infectives at Allergan since 2015.
−Removed: In that capacity, he oversaw the development and regulatory approval of Teflaro®, Avycaz®, and Dalvance® in the United States.
−Removed: Prior to Allergan, Dr.
−Removed: Melnick served fifteen years at AstraZeneca in various levels of increasing responsibility, most recently as Vice President of Clinical Development for Anti-Infectives.
−Removed: In that capacity, he oversaw the late stage clinical development of Merrem®, Teflaro®, and Avycaz®.
−Removed: In addition, he served as the acting Vice President for early development at AstraZeneca.
−Removed: He received his medical training at Columbia University, followed by a Residency in Internal Medicine at The New York Hospital-Cornell Medical Center.
−Removed: Following a Fellowship in Infectious Disease at Yale University, he held faculty positions at the Boston University School of Medicine and the National Institute of Allergy and Infectious Diseases.
−Removed: He subsequently joined Kaiser-Permanente as a practicing Infectious Diseases specialist and as the Director of HIV Clinical Research at Kaiser Permanente Mid-Atlantic, with a faculty appointment at Georgetown University.
−Removed: Thomas Parr Jr., Ph.D.
−Removed: has served as our Chief Scientific Officer since April 2014.
−Removed: He has more than 30 years of drug discovery experience across both large pharmaceutical and small biotechnology companies.
−Removed: Prior to joining Spero, from 2012 to 2014, Dr.
−Removed: Parr was the Chief Scientific Officer at Fedora Pharmaceuticals, Inc.
−Removed: where the company moved novel diazabicyclooctane beta-lactramase inhibitors toward development partnerships.
−Removed: Prior to Fedora, he was the Chief Scientific Officer at Targanta Therapeutics, now part of The Medicines Company.
−Removed: Parr earned his Ph.D.
−Removed: from the University of Calgary and conducted a postdoctoral fellowship at the University of British Columbia.
−Removed: He was an Assistant Professor in the Department of Microbiology and Biochemistry at the University of Ottawa before beginning his drug discovery and development career.
−Removed: Timothy Keutzer has served as our Chief Development Officer since June 2019.
−Removed: He has over 20 years experience in the pharmaceutical industry, spanning multiple functional and therapeutic areas.
−Removed: Prior to joining Spero, Mr.
−Removed: Keutzer served in various roles at Cubist Pharmaceuticals, including Vice President of Program and Portfolio Management from May 2014 to July 2015.
−Removed: At Cubist Mr.
−Removed: Keutzer was the program leader for ceftolozane/tazobactam, which progressed rapidly from Phase 1 to Phase 3, and was approved in the FDA in December of 2014.
−Removed: Prior to that role, he also led several of Cubist’s in-licensed development programs, and also led the commercial supply chain for Cubicin.
−Removed: His experience before Cubist spans multiple drug classes, and includes preclinical PK/PD and clinical operations at Genetics Institute, as well as global strategic marketing and program management at Wyeth.
−Removed: Tim began his career in contract toxicology labs.
−Removed: Keutzer earned his bachelor’s degree from the University of Kentucky.
+Added: The response to this item is incorporated by reference from the discussion responsive thereto under the captions “Management and Corporate Governance Matters,” “Section 16(a) Beneficial Ownership Reporting Compliance,” and “Code of Conduct and Ethics” in the Company’s proxy statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.
Executive Compensation.
−Removed: Summary Compensation Table
−Removed: The following table shows the total compensation paid or accrued during the last two fiscal years ended December 31, 2019 and 2018 to our President and Chief Executive Officer and our two next most highly compensated executive officers who earned more than $100,000 during the fiscal year ended December 31, 2019 and were serving as executive officers as of such date.
−Removed: Name and Principal Position
−Removed: Incentive Plan
−Removed: Ankit Mahadevia, M.D.
−Removed: Chief Executive Officer
−Removed: Christina Larkin
−Removed: Chief Operating Officer
−Removed: David Melnick, M.D.
−Removed: Chief Medical Officer
−Removed: Consists of a sign-on bonus to Dr.
−Removed: Melnick in connection with his commencement of employment in January 2018.
−Removed: These amounts represent the aggregate grant date fair value for performance-based stock awards computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, or ASC 718.
−Removed: A discussion of the assumptions used in determining grant date fair value may be found in Note 9 to our consolidated financial statements for the year ended December 31, 2019.
−Removed: These amounts represent the aggregate grant date fair value for option awards computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, or ASC 718.
−Removed: A discussion of the assumptions used in determining grant date fair value may be found in Note 9 to our consolidated financial statements for the year ended December 31, 2019.
−Removed: Amounts represent cash bonuses earned for the applicable fiscal year.
−Removed: Consists of the dollar value of life insurance premiums the Company paid with respect to term life insurance for the benefit of the executive officers named in the table above.
−Removed: With respect to Dr.
−Removed: Melnick, this amount also includes the reimbursement of certain relocation expenses in the amount of $19,661 paid in 2018.
−Removed: Narrative Disclosure to Summary Compensation Table
−Removed: Our employment arrangements with our named executive officers are described below.
−Removed: Ankit Mahadevia, M.D.
−Removed: On March 2, 2015, Dr.
−Removed: Mahadevia executed an offer letter with respect to his employment as our Chief Executive Officer beginning on the same date.
−Removed: Under the terms of the offer letter, Dr.
−Removed: Mahadevia’s annual base salary was $360,500 in 2016 and $400,000 effective on May 19, 2017.
−Removed: Under the offer letter, he was eligible to receive an annual incentive bonus determined at the discretion of our Board of Directors or Compensation Committee, with a target bonus opportunity of 30% of his then-current base salary.
−Removed: Mahadevia entered into a new employment agreement on October 20, 2017.
−Removed: This agreement provides for the following increased severance payments upon termination by us without Cause (as defined below) or by Dr.
−Removed: Mahadevia for Good Reason (as defined below):
−Removed: (i) payment of his then-current base salary for a period of 12 months following termination;
−Removed: (ii) a pro-rated target bonus for the period during which Dr.
−Removed: Mahadevia was employed in the year of termination;
−Removed: and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date Dr.
−Removed: Mahadevia becomes eligible for medical benefits with another employer.
−Removed: Further, the new agreement provides that upon termination by us without Cause or by Dr.
−Removed: Mahadevia for Good Reason within 90 days prior to the earlier to occur of a Change of Control (as defined below) or the execution of a definitive agreement the consummation of which would result in a Change of Control or one year following a Change of Control (a “Change of Control Termination”), Dr.
−Removed: Mahadevia will be entitled to receive (i) a lump sum payment equal to 12 months of his then-current base salary plus a pro-rated target bonus for the period during which Dr.
−Removed: Mahadevia was employed in the year of termination;
−Removed: (ii) acceleration of all unvested equity awards as of the date of termination;
−Removed: and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date Dr.
−Removed: Mahadevia becomes eligible for medical benefits with another employer.
−Removed: Payment in each case is subject to Dr.
−Removed: Mahadevia’s execution of a release satisfactory to us following such termination.
−Removed: In addition, if Dr.
−Removed: Mahadevia’s employment terminates as a result of disability or death, he shall be entitled to receive a pro-rated target bonus for the period during which Dr.
−Removed: Mahadevia was employed in the year of termination.
−Removed: The new agreement also provides that Dr.
−Removed: Mahadevia shall serve as a member of our Board of Directors during his employment with us until the term of his directorship expires and he is not re-elected or his earlier resignation or removal from our Board of Directors.
−Removed: In December 2017, Dr.
−Removed: Mahadevia’s base salary was increased, effective January 1, 2018, to $465,000 with a target bonus opportunity of 50% of base salary.
−Removed: In December 2018, Dr.
−Removed: Mahadevia’s base salary was increased, effective February 1, 2019, to $500,000 with a target bonus opportunity of 50% of his base salary.
−Removed: In December 2019, Dr.
−Removed: Mahadevia’s base salary was increased, effective February 1, 2020, to $540,000, with a target bonus opportunity of 50% of his base salary.
−Removed: David Melnick, M.D.
−Removed: On December 13, 2017, we entered into an agreement with Dr.
−Removed: Melnick with respect to his employment as our Chief Medical Officer commencing on January 4, 2018.
−Removed: The terms of Mr.
−Removed: Melnick’s offer letter provided for an annual base salary of $380,000 prorated for fiscal year 2018, and eligibility for an annual incentive bonus, with a target bonus opportunity of 35% of his then-current base salary.
−Removed: In December 2018, Dr.
−Removed: Melnick’s base salary was increased, effective February 1, 2019, to $390,000 with a target bonus opportunity of 40% of base salary.
−Removed: In addition, Dr.
−Removed: Melnick was granted an option to purchase 135,000 shares of common stock and received a sign-on bonus of $10,000.
−Removed: In December 2019, Dr.
−Removed: Melnick’s base salary was increased, effective February 1, 2020, to $413,400 with a target bonus opportunity of 40% of his base salary.
−Removed: The agreement also provides for the following severance payments upon termination by us without Cause or by Dr.
−Removed: Melnick for Good Reason:
−Removed: (i) payment of his then-current base salary for a period of nine months following termination;
−Removed: (ii) a pro-rated target bonus for the period during which Dr.
−Removed: Melnick was employed in the year of termination;
−Removed: and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date Dr.
−Removed: Melnick becomes eligible for medical benefits with another employer.
−Removed: Further, the agreement provides that upon termination by us without Cause or by Dr.
−Removed: Melnick for Good Reason within 90 days prior to the earlier to occur of a Change of Control or the execution of a definitive agreement the consummation of which would result in a Change of Control or one year following a Change of Control (a “Change of Control Termination”), Dr.
−Removed: Melnick will be entitled to receive:
−Removed: (i) a lump sum payment equal to 12 months of his then-current base salary plus a pro-rated target bonus for the period during which Dr.
−Removed: Melnick was employed in the year of termination;
−Removed: (ii) acceleration of (A) all unvested equity awards as of the date of termination if Dr.
−Removed: Melnick’s employment commenced at least 24 months prior to a Change of Control (B) 50% of all unvested equity awards as of the date of termination if Melnick’s employment commenced fewer than 24 months but at least 12 months prior to a Change of Control and (C) 25% of all unvested equity awards as of the date of termination if Dr.
−Removed: Melnick’s employment commenced fewer than 12 months prior to a Change of Control;
−Removed: and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date Dr.
−Removed: Melnick becomes eligible for medical benefits with another employer.
−Removed: Payment in each case is subject to Dr.
−Removed: Melnick’s execution of a release satisfactory to us following such termination.
−Removed: In addition, if Dr.
−Removed: Melnick’s employment terminates as a result of disability or death, he shall be entitled to receive a pro-rated target bonus for the period during which Dr.
−Removed: Melnick was employed in the year of termination.
−Removed: Cristina Larkin
−Removed: In February 2016, Cristina Larkin, our then Chief Commercial Officer, executed an offer letter with respect to her employment beginning on March 7, 2016.
−Removed: In September 2017 Ms.
−Removed: Larkin was promoted to Chief Operating Officer, in connection with which her bonus target was increased from 25% to 30% of her then-current base salary.
−Removed: In October 2017, we entered into a new employment agreement with Ms.
−Removed: Larkin, which provided for a base salary of $345,000 and eligibility for an annual incentive bonus, with a target bonus opportunity of 30% of her then-current base salary.
−Removed: In December 2017, Ms.
−Removed: Larkin’s base salary was increased, effective January 1, 2018, to $385,000 with a target bonus opportunity of 35% of base salary.
−Removed: In December 2018, Ms.
−Removed: Larkin’s base salary was increased, effective February 1, 2019, to $395,000 with a target bonus opportunity of 40% of base salary.
−Removed: In December 2019, Ms.
−Removed: Larkin’s base salary was increased, effective February 1, 2020, to $404,875 with a target bonus opportunity of 40% of her base salary.
−Removed: The agreement also provides for the following severance payments upon termination by us without Cause or by Ms.
−Removed: Larkin for Good Reason:
−Removed: (i) payment of her then-current base salary for a period of nine months following termination;
−Removed: (ii) a pro-rated target bonus for the period during which Ms.
−Removed: Larkin was employed in the year of termination;
−Removed: and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date Ms.
−Removed: Larkin becomes eligible for medical benefits with another employer.
−Removed: Further, the agreement provides that upon termination by us without Cause or by Ms.
−Removed: Larkin for Good Reason within 90 days prior to the earlier to occur of a Change of Control or the execution of a definitive agreement the consummation of which would result in a Change of Control or one year following a Change of Control (a “Change of Control Termination”), Ms.
−Removed: Larkin will be entitled to receive:
−Removed: (i) a lump sum payment equal to 12 months of her then-current base salary plus a pro-rated target bonus for the period during which Ms.
−Removed: Larkin was employed in the year of termination;
−Removed: (ii) acceleration of (A) all unvested equity awards as of the date of termination if Ms.
−Removed: Larkin’s employment commenced at least 24 months prior to a Change of Control (B) 50% of all unvested equity awards as of the date of termination if Ms.
−Removed: Larkin’s employment commenced fewer than 24 months but at least 12 months prior to a Change of Control or (C) 25% of all unvested equity awards as of the date of termination if Ms.
−Removed: Larkin’s employment commenced fewer than 12 months prior to a Change of Control;
−Removed: and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date Ms.
−Removed: Larkin becomes eligible for medical benefits with another employer.
−Removed: Payment in each case is subject to Ms.
−Removed: Larkin’s execution of a release satisfactory to us following such termination.
−Removed: In addition, if Ms.
−Removed: Larkin’s employment terminates as a result of disability or death, she shall be entitled to receive a pro-rated target bonus for the period during which Ms.
−Removed: Larkin was employed in the year of termination.
−Removed: Under each of the employment agreements, Cause means (i) the executive’s conviction of (A) a felony or (B) any misdemeanor involving moral turpitude, deceit, dishonesty or fraud;
−Removed: (ii) the executive’s willful failure or refusal to comply with lawful directions of our Board of Directors, with respect to Dr.
−Removed: Mahadevia, or of our Chief Executive Officer, with respect to Dr.
−Removed: Melnick and Ms.
−Removed: Larkin, which failure or refusal continues for more than thirty days after written notice is given to the executive by our Board of Directors, with respect to Dr.
−Removed: Mahadevia, or by our Chief Executive Officer, with respect to Dr.
−Removed: Melnick and Ms.
−Removed: Larkin, which notice sets forth in reasonable detail the nature of such failure or refusal;
−Removed: (iii) willful and material breach by the executive of a written company policy applicable to the executive or the executive’s covenants and/or obligations under his or her employment agreement or the material breach of the executive’s proprietary information and inventions assignment agreement;
−Removed: and/or (iv) material misconduct by the executive that seriously discredits or damages us or any of our affiliates.
−Removed: Under each of the employment agreements, Good Reason means (i) relocation of the executive’s principal business location to a location more than thirty (30) miles from the executive’s then-current business location;
−Removed: (ii) a material diminution in the executive’s duties, authority or responsibilities;
−Removed: (iii) a material reduction in the executive’s base salary;
−Removed: (iv) willful and material breach by us of our covenants and/or obligations under the executive’s employment agreement;
−Removed: or (v) within one year following a Change of Control, the executive is not an executive of the parent company, provided that the executive’s roles responsibilities and scope of authority within the subsidiary is not comparable to the executive’s roles, responsibilities and scope of authority with us prior to the Change of Control.
−Removed: Under each of the employment agreements, Change of Control means (i) any person (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the beneficial owner, directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting securities (excluding for this purpose any such voting securities held by the Company, or any affiliate, parent or subsidiary of the Company, or by any employee benefit plan of the Company) pursuant to a transaction or a series of related transactions;
−Removed: (ii) a merger or consolidation of the Company other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or the parent of such corporation) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or parent of such corporation, as the case may be, outstanding immediately after such merger or consolidation;
−Removed: (iii) our stockholders approve an agreement for the sale or disposition by the Company of all or substantially all of our assets;
−Removed: or (iv) a change in the composition of our Board of Directors, as a result of which fewer than a majority of the directors are incumbent directors.
−Removed: All of our executive officers have entered into our standard proprietary information and inventions assignment agreement.
−Removed: Outstanding Equity Awards at 2019 Fiscal Year-End
−Removed: On June 30, 2017, we completed a series of transactions pursuant to which Spero Therapeutics, LLC merged with and into Spero Therapeutics, Inc., with Spero Therapeutics, Inc.
−Removed: continuing as the surviving corporation (the “2017 Reorganization”).
−Removed: As part of the 2017 Reorganization, each of the capital units of Spero Therapeutics, LLC issued and outstanding prior to the 2017 Reorganization was cancelled and converted into and exchanged for one share of Spero Therapeutics, Inc.
−Removed: capital stock of the same class and/or series, and each of the incentive units of Spero Therapeutics, LLC was terminated and cancelled.
−Removed: Promptly after the 2017 Reorganization, previous holders of incentive units who were still employed by us at the time of the Reorganization received stock options under the 2017 Plan.
−Removed: Such stock options were granted for the same number of shares of our common stock as the number of incentive units cancelled, and the stock options were granted with continued vesting on the same terms and with similar rights and restrictions as the incentive units.
−Removed: All such stock options have an exercise price of $5.90.
−Removed: The following table shows grants of stock options outstanding on the last day of the fiscal year ended December 31, 2019 to each of the executive officers named in the Summary Compensation Table.
−Removed: Option Awards
−Removed: Unexercisable
−Removed: shares, units
−Removed: shares, units
−Removed: Ankit Mahadevia, M.D.
−Removed: Cristina Larkin
−Removed: David Melnick, M.D.
−Removed: 100% of these options vested on August 24, 2019.
−Removed: As part of the 2017 Reorganization, Dr.
−Removed: Mahadevia was granted options to replace his previously awarded incentive units in Spero Therapeutics, LLC.
−Removed: The options vest in accordance with the vesting terms of Dr.
−Removed: Mahadevia’s previously held incentive units:
−Removed: 25% of the underlying shares were deemed vested April 28, 2017, the first anniversary of the vesting commencement date, with an additional 1/36th of the remaining shares vesting monthly thereafter until the option is fully vested.
−Removed: In addition, in the event of a Change of Control Termination, the vesting of these options will accelerate in accordance with the terms of the option and his employment agreement.
−Removed: 100% of these options vested on July 6, 2017.
−Removed: 25% of the options vested on July 6, 2018 and an additional 1/36th of the remaining shares vest monthly until the option is fully vested.
−Removed: In addition, in the event of a Change of Control Termination, the vesting of these options will accelerate in accordance with the terms of the option and his or her employment agreement.
−Removed: 25% of the options vested on December 13, 2018 and an additional 1/36th of the remaining shares vest monthly until the option is fully vested.
−Removed: In addition, in the event of a Change of Control Termination, the vesting of these options will accelerate in accordance with the terms of the option and his or her employment agreement.
−Removed: 25% of the options vest on January 2, 2020 and an additional 1/36th of the remaining shares vest monthly until the option is fully vested.
−Removed: In addition, in the event of a Change of Control Termination, the vesting of these options will accelerate in accordance with the terms of the option and his or her employment agreement.
−Removed: These performance-based options, which were granted in March 2019, vest in four equal installments upon the achievement, within the performance period ending December 31, 2020, of certain performance goals, which are more fully described below under “Performance-Based Equity Incentive Awards,” and are contingent on the executive remaining an employee, director or consultant of Spero as of each such date.
−Removed: These performance-based restricted stock units, which were granted in March 2019, vest in four equal installments upon the achievement, within the performance period ending December 31, 2020, of certain performance goals, which are more fully described below under “Performance-Based Equity Incentive Awards,” and are contingent on the executive remaining an employee, director or consultant of Spero as of each such date.
−Removed: As part of the Company’s 2017 Reorganization, Ms.
−Removed: Larkin was granted options to replace her previously awarded incentive units in Spero Therapeutics, LLC.
−Removed: The options vest in accordance with the vesting terms of Ms.
−Removed: Larkin’s previously held incentive units:
−Removed: 25% of the underlying shares were deemed vested on March 7, 2017, the first anniversary of the vesting commencement date, with an additional 1/36th of the remaining shares vesting monthly thereafter until the option is fully vested.
−Removed: In addition, in the event of a Change of Control Termination, the vesting of these options will accelerate in accordance with the terms of the option and her employment agreement.
−Removed: As part of the Reorganization, Ms.
−Removed: Larkin was granted options to replace her previously awarded incentive units in Spero Therapeutics, LLC.
−Removed: The options vest in accordance with the vesting terms of Ms.
−Removed: Larkin’s previously held incentive units:
−Removed: 25% of the underlying shares were deemed vested April 28, 2017, the first anniversary of the vesting commencement date, with an additional 1/36th of the remaining shares vesting monthly thereafter until the option is fully vested.
−Removed: In addition, in the event of a Change of Control Termination, the vesting of these options will accelerate in accordance with the terms of the option and her employment agreement.
−Removed: 25% of the options vested on January 4, 2019 and an additional 1/36th of the remaining shares vest monthly until the option is fully vested.
−Removed: In addition, in the event of a Change of Control Termination, the vesting of these options will accelerate in accordance with the terms of the option and his employment agreement.
−Removed: Performance-Based Equity Incentive Awards
−Removed: Historically, we have generally granted stock options with time-based vesting to our executives at the time of hire and on an annual basis thereafter.
−Removed: In March 2019, in addition to the foregoing, we granted an aggregate of 150,000 performance-based options and restricted stock units (“RSUs”) to our senior executives.
−Removed: These options and RSUs (the “Performance Awards”) are subject to performance-based vesting eligibility and a subsequent partial time-based vesting schedule.
−Removed: Specifically, the Performance Awards are eligible for vesting based on the achievement of performance criteria, each representing a 25% vesting opportunity if achieved within a specified time during the performance period (the “Performance Period”), and relating to (i) the release of tebipenem HBr top-line data;
−Removed: (ii) FDA acceptance of a tebipenem HBr New Drug Application;
−Removed: (iii) non-dilutive financing;
−Removed: and (iv) equity financing.
−Removed: Following the Performance Period, Performance Awards determined to be eligible for vesting as a result of achievement of the performance criteria will vest as follows:
−Removed: (a) 50% of the eligible award will vest immediately, and (b) the remaining eligible award will vest (i) in the case of options, in equal monthly instalments ending two years after the Performance Period expiration, and (ii) in the case of RSUs, on such two year anniversary.
−Removed: The Performance Awards will be subject to provisions of the executives’ employment agreements regarding acceleration of vesting in the event of certain termination events following a change in control only to the extent previously determined to be eligible for vesting as a result of achievement of the performance criteria.
−Removed: We believe the achievement of the performance criteria will require significant execution and effort by the executives with no assurance of achievement guaranteed.
−Removed: Awards for which the performance criteria has not been achieved as specified during the Performance Period will lapse.
−Removed: Potential Payments upon Termination or Change-In-Control
−Removed: The employment agreements provide for the following severance payments upon termination by us without Cause or by the employee for Good Reason:
−Removed: (i) payment of the employee’s then-current base salary for a period of nine months following termination (12 months in the case of the Chief Executive Officer);
−Removed: (ii) a pro-rated target bonus for the period during which the employee was employed in the year of termination;
−Removed: and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date the employee becomes eligible for medical benefits with another employer.
−Removed: Further, the agreements provide that upon termination by us without Cause or by the employee for Good Reason within 90 days prior to or one year following the earlier to occur of a Change of Control (as defined in the executive’s employment agreements) or the execution of a definitive agreement the consummation of which would result in a Change of Control, the employee will be entitled to receive:
−Removed: (i) a lump sum payment equal to 12 months of the employee’s then-current base salary plus a pro-rated target bonus for the period during which the employee was employed in the year of termination;
−Removed: (ii) acceleration of unvested equity awards as of the date of termination in accordance with the terms of the executive’s employment agreement, as described above under “Narrative Disclosure to Summary Compensation Table;” and (iii) continued coverage under our group health insurance plan until the earlier of 12 months from termination or the date the employee becomes eligible for medical benefits with another employer.
−Removed: Payment in each case is subject to the employee’s execution of a release satisfactory to us following such termination.
−Removed: In addition, if the employee’s employment terminates as a result of disability or death, he or she shall be entitled to receive a pro-rated target bonus for the period during which the employee was employed in the year of termination.
−Removed: Director Compensation
−Removed: The following table shows the total compensation paid or accrued during the fiscal year ended December 31, 2019 to each of our current and former non-employee directors.
−Removed: Cynthia Smith joined our Board of Directors in March 2019.
−Removed: Directors who are employed by us are not compensated for their service on our Board of Directors.
−Removed: Fees Earned or
−Removed: Awards* ($) (5)
−Removed: Milind Deshpande, Ph.D.
−Removed: Jean-François Formela, M.D.
−Removed: Pottage, Jr., M.D.
−Removed: Cynthia Smith(1)
−Removed: 151,135(3)(4)
−Removed: Patrick Vink, M.D.
−Removed: These amounts represent the aggregate grant date fair value of options granted to each director in the fiscal year ended December 31, 2019, computed in accordance with FASB ASC Topic 718.
−Removed: A discussion of the assumptions used in determining grant date fair value may be found in Note 9 to our consolidated financial statements, included in this Annual Report on Form 10-K..
−Removed: Smith joined our Board of Directors in March 2019.
−Removed: Southwell resigned from our Board of Directors in April 2019.
−Removed: Represents an option to purchase 6,073 shares of common stock at an exercise price of $10.67.
−Removed: The shares underlying the option award vest and become fully exercisable on June 5, 2020, subject to the individual’s continued service as of such date.
−Removed: Represents an option to purchase 12,146 shares of common stock at an exercise price of $12.81.
−Removed: The shares underlying the option award vest in thirty-six equal monthly installments at the end of each successive month following March 29, 2019, subject to the individual’s continued service as of such date.
−Removed: As of December 31, 2019, the aggregate number of options held by each of our non-employee directors was as follows (representing both exercisable and unexercisable option awards, none of which have been exercised):
−Removed: Number of Shares
−Removed: Stock Options
−Removed: Milind Deshpande, Ph.D.
−Removed: Jean François Formela, M.D.
−Removed: Pottage, Jr., M.D.
−Removed: Cynthia Smith
−Removed: Patrick Vink, M.D.
−Removed: Non-Employee Director Compensation Policy
−Removed: Under our Non-Employee Director Compensation Policy, as amended, each non-employee director is eligible to receive compensation for his or her service consisting of annual cash retainers and equity awards.
−Removed: Our non-employee directors receive the following annual retainers for their service:
−Removed: Board Chairperson (additional retainer)
−Removed: Lead Director, if any (additional retainer)
−Removed: Audit Committee Chair
−Removed: Compensation Committee Chair
−Removed: Nominating and Governance Committee Chair
−Removed: Audit Committee Member
−Removed: Compensation Committee Member
−Removed: Nominating and Governance Committee Member
−Removed: In December 2019 we amended our Non-Employee Director Compensation Policy to provide the following with respect to equity awards to non-employee directors:
−Removed: (i) the initial equity award consisting of a non-qualified stock option to purchase shares of our common stock upon first appointment to our Board of Directors and vesting in equal monthly installments until the third anniversary of the grant date was increased from 12,146 shares to 15,000 shares, subject to the non-employee director’s continued service, and (ii) annual equity awards commencing in 2018 consisting of a non-qualified stock option to purchase shares of our common stock vesting on the first anniversary of the grant date was increased from 6,073 shares to 7,500 shares, subject to the non-employee director’s continued service.
−Removed: The policy was further amended to provide that, prior to the beginning of each calendar year, a non-employee director may elect to receive all or a portion of his or her base annual fee for service on our Board of Directors (i.e., $35,000) in the form of a non-qualified stock option to purchase the number of shares of our common stock as is equal to the Black-Scholes value of such fee (or portion thereof), which option will be granted on the first business day of the calendar year.
−Removed: Directors may be reimbursed for travel, food, lodging and other expenses directly related to their service as directors.
−Removed: Directors are also entitled to the protection provided by their indemnification agreements and the indemnification provisions in our amended and restated certificate of incorporation and amended and restated By-Laws.
−Removed: Security Ownership of Certain Beneficial Own ers and Management and Related Stockholder Matters.
−Removed: The following table sets forth certain information with respect to the beneficial ownership of our common stock as of March 1, 2020 for (a) the executive officers named in the Summary Compensation Table on Item 11 of this Annual Report on Form 10-K, (b) each of our directors and director nominees, (c) all of our current directors and executive officers as a group and (d) each stockholder known by us to own beneficially more than 5% of our common stock.
−Removed: Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the securities.
−Removed: We deem shares of common stock that may be acquired by an individual or group within 60 days of March 1, 2020 pursuant to the exercise of options to be outstanding for the purpose of computing the percentage ownership of such individual or group, but not outstanding for the purpose of computing the percentage ownership of any other person shown in the table.
−Removed: Except as indicated in footnotes to this table, we believe that the stockholders named in this table have sole voting and investment power with respect to all shares of common stock shown to be beneficially owned by them based on information provided to us by these stockholders.
−Removed: Percentage of ownership is based on 19,190,695 shares of common stock outstanding on December 31, 2019.
−Removed: Name of Beneficial Owner
−Removed: Number of Shares
−Removed: Percent of Shares
−Removed: Beneficially Owned
−Removed: Principal Stockholders
−Removed: One, Limited (1)
−Removed: Entities affiliated with BVF Inc.
−Removed: Atlas Venture Fund IX, L.P.
−Removed: GV 2015, L.P.
−Removed: Entities affiliated with Aquilo Capital Management, LLC (5)
−Removed: Atlas Venture Fund X, LLC (6)
−Removed: Named Executive Officers and Directors
−Removed: Ankit Mahadevia, M.D.
−Removed: Cristina Larkin (8)
−Removed: David Melnick, M.D.
−Removed: Milind Deshpande, Ph.D.
−Removed: Jean-François Formela, M.D.
−Removed: Pottage, Jr., M.D.
−Removed: Cynthia Smith (13)
−Removed: Patrick Vink, M.D.
−Removed: All current executive officers and directors as a group (11 persons)
−Removed: Indicates beneficial ownership of less than 1%.
−Removed: Consists of 1,934,006 shares of common stock owned by S.R.
−Removed: One, Limited, or S.R.
−Removed: One, an indirect wholly owned subsidiary of GlaxoSmithKline plc.
−Removed: The address for S.R.
−Removed: One is 161 Washington Street, Suite 500, Eight Tower Bridge, Conshohocken, Pennsylvania 19428.
−Removed: This information is based solely on a Schedule 13D/A filed by GlaxoSmithKline plc with the SEC on February 14, 2020, which reported ownership as of such date.
−Removed: Includes (i) 1,217,924 shares of common stock held by Biotechnology Value Fund, L.P., or BVF, (ii) 664,230 shares of common stock held by Biotechnology Value Fund II, L.P., or BVF II, and (iii) 55,550 shares of common stock held by Biotechnology Value Trading Fund OS LP, or Trading Fund OS.
−Removed: BVF I GP LLC, or BVF GP, as general partner of BVF, may be deemed to beneficially own 1,217,924 shares of common stock beneficially owned by BVF.
−Removed: BVF II GP LLC, or BVF II GP, as general partner of BVF II, may be deemed to beneficially own 664,230 shares of common stock beneficially owned by BVF II.
−Removed: BVF Partners OS Ltd, or Partners OS, as general partner of Trading Fund OS, may be deemed to beneficially own 55,550 shares of common stock beneficially owned by Trading Fund OS.
−Removed: BVF GP Holdings LLC, or BVF GPH, as the sole member of BVF GP and BVF II GP, may be deemed to beneficially own 1,882,154 shares of common stock beneficially owned in the aggregate by BVF GP and BVF II GP.
−Removed: BVF Partners L.P., or Partners, as investment manager of BVF, BVF II andTrading Fund OS, and the sole member of Partners OS, may be deemed to beneficially own the 2,028,405 shares of common stock beneficially owned in the aggregate by BVF, BVF II, Trading Fund OS, and certain managed accounts of Partners, or the Partners Managed Accounts, including 90,701 shares of common stock held in the Partners Managed Accounts.
−Removed: BVF Inc., as the general partner of Partners, may be deemed to beneficially own the 2,028,405 shares of common stock owned by Partners.
−Removed: Lampert is a director and officer of BVF Inc., and may be deemed to beneficially own the 2,028,405 shares of common stock beneficially owned by BVF, Inc.
−Removed: Together, BVF, BVF II, BVF GP, BVF II GP, Trading Fund OS, BVF GPH, Partners OS, Partners, BVF Inc.
−Removed: Lampert (the “BVF Entities”) hold 1,720 shares of Series A Convertible Preferred Stock (“Series A Preferred”) convertible for an aggregate of 1,720,000 shares of common stock.
−Removed: The Series A Preferred may not be converted if, after such conversion, the BVF Entities would beneficially own more than 9.99% of the common stock then issued and outstanding (the “Series A Blocker”).
−Removed: As of December 31, 2019, the Series A Blocker limited the aggregate conversion of Series A Preferred to 1,183,000 of the 1,720,000 shares of common stock underlying the Series A Preferred.
−Removed: As a result of the Series A Blocker, included in the percentage of shares beneficially owned as of December 31, 2019 is the maximum number of shares of common stock issuable upon conversion of Series A Preferred up to the limit imposed by the Series A Blocker, and excluded are the remaining shares of common stock issuable upon conversion of Series A Preferred that are prevented from converting due to the Series A Blocker.
−Removed: Together the BVF Entities also hold 1,000 shares of Series B Convertible Preferred Stock (the “Series B Preferred”) convertible for an aggregate of 1,000,000 shares of common stock.
−Removed: The Series B Preferred may not be converted if, after such conversion, the BVF Entities would beneficially own more than 9.99% of the common stock then issued and outstanding (the “Series B Blocker”).
−Removed: As of December 31, 2019, the Series B Blocker limits the aggregate conversion of Series B Preferred by the BVF Entities to 0 out of the 1,000,000 shares of common stock underlying the Series B Preferred.
−Removed: BVF GP disclaims beneficial ownership of the shares of common stock beneficially owned by BVF.
−Removed: BVF II GP disclaims beneficial ownership of the shares of common stock beneficially owned by BVF II.
−Removed: Partners OS disclaims beneficial ownership of the shares of common stock beneficially owned by Trading Fund OS.
−Removed: BVF GPH disclaims beneficial ownership of the shares of common stock beneficially owned by BVF GP and BVF II GP.
−Removed: Each of Partners, BVF Inc.
−Removed: Lampert disclaims beneficial ownership of the shares of common stock beneficially owned by BVF, BVF II, Trading Fund OS, and the Partners Management Accounts.
−Removed: The address of the principal business and office of BVF Inc.
−Removed: and certain of its affiliates is 1 Sansome Street, 30th Floor, San Francisco, California, 94194.
−Removed: This information is based solely on a Schedule 13G/A filed with the SEC on February 18, 2020, which reported ownership as of December 31, 2019.
−Removed: All shares are held directly by Atlas Venture Fund IX.
−Removed: Atlas Venture Associates IX, L.P., or AVA IX LP, is the general partner of Atlas Venture Fund IX, and Atlas Venture Associates IX, LLC, or AVA IX LLC, is the general partner of AVA IX LP.
−Removed: Peter Barrett, Bruce Booth, Jean-François Formela, M.D., Jeff Fagnan, and Ryan Moore are the members of AVA IX LLC and collectively make investment decisions on behalf of Atlas Venture Fund IX.
−Removed: Formela is also a member of our Board of Directors.
−Removed: Formela disclaims beneficial ownership of such shares of common stock, except to the extent of his pecuniary interest therein, if any.
−Removed: The address for Atlas Venture Fund IX, is 25 First Street, Suite 303, Cambridge, Massachusetts 02141.
−Removed: This information is based solely on a Schedule 13G/A filed by Atlas Venture Fund IX, L.P.
−Removed: with the SEC on February 4, 2020, which reported ownership as of December 31, 2019.
−Removed: GV 2015 GP, L.L.C., the general partner of GV 2015, L.P., Alphabet Holdings LLC, the sole member of GV 2015 GP, L.L.C., Google LLC, the sole member of Alphabet Holdings LLC, XXVI Holdings Inc., the managing member of Google LLC, and Alphabet Inc., the sole stockholder of XXVI Holdings Inc., may be deemed to have sole power to vote or dispose of the shares held by GV 2015, L.P.
−Removed: The address for GV 2015, L.P., GV 2015 GP, L.L.C., Alphabet Holdings LLC, Google LLC, XXVI Holdings Inc.
−Removed: and Alphabet Inc.
−Removed: is 1600 Amphitheatre Parkway, Mountain View, California 94043.
−Removed: This information is based solely on a Schedule 13G filed by GV 2015, L.P.
−Removed: with the SEC on February 14, 2018, which reported ownership as of December 31, 2017.
−Removed: Aquilo Capital Management, LLC is an investment advisor that serves as the general partner and investment manager to each of Aquilo Capital, L.P.
−Removed: and Aquilo Capital II, L.P., (collectively, the “Aquilo Funds”), and may be deemed to be the beneficial owner of all shares of common stock held by the Aquilo Funds.
−Removed: Marc Schneidman, as Managing Member of Aquilo Capital Management, LLC, with the power to exercise investment and voting discretion, may be deemed to be the beneficial owner of all shares of common stock held by the Aquilo Funds.
−Removed: Each of the Aquilo Funds and Mr.
−Removed: Schneidman expressly disclaims beneficial ownership over any of the shares of common stock held by the Aquilo Funds.
−Removed: The address for Aquilo Capital, L.P.
−Removed: and Aquilo Capital II, L.P.
−Removed: is One Letterman Drive, Suite D4900, Building D, The Presidio, San Francisco, California 94129.
−Removed: This information is based solely on a Schedule 13G/A filed by Aquilo Capital, L.P.
−Removed: with the SEC on February 14, 2020, which reported ownership as of such date.
−Removed: All shares are held directly by Atlas Venture Fund X, LLC, or Atlas Fund X.
−Removed: Atlas Venture Associates X, L.P., or AVA X LP, is the general partner of Atlas Venture Fund X, and Atlas Venture Associates X, LLC, or AVA X LLC, is the general partner of AVA X LP.
−Removed: Peter Barrett, Bruce Booth, Jean-François Formela, M.D., David Gragzel and Jason Rhodes are the members of AVA X LLC and collectively make investment decisions on behalf of Atlas Venture Fund X.
−Removed: Formela is also a member of our Board of Directors.
−Removed: Formela disclaims beneficial ownership of such shares, except to the extent of his pecuniary interest therein, if any.
−Removed: The address for Atlas Venture Fund X, is 400 Technology Square, 10th Floor, Cambridge, Massachusetts 02139.
−Removed: This information is based solely on a Schedule 13D filed by Atlas Venture Fund X, L.P.
−Removed: with the SEC on March 14, 2018, which reported ownership as of December 31, 2017.
−Removed: Consists of (i) 65,817 shares of common stock held by Mahadevia-Mehta Family Trust, of which Dr.
−Removed: Mahadevia is the trustee, and (ii) 578,700 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Dr.
−Removed: Consists of (i) 1,500 shares of common stock and (ii) 136,238 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Ms.
−Removed: Consists of 96,251 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Dr.
−Removed: Consists of (i) 16,454 shares of common stock and (ii) 41,784 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Dr.
−Removed: See footnotes 3 and 6.
−Removed: Also includes 7,425 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Dr.
−Removed: Consists of 6,073 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Dr.
−Removed: Consists of 4,048 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Ms.
−Removed: Consists of 27,728 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Mr.
−Removed: Consists of 31,203 shares of common stock underlying options that are exercisable as of March 1, 2020 or will become exercisable within 60 days after such date held by Dr.
−Removed: See notes 3, 6 and 7 through 15 above;
−Removed: also includes Stephen DiPalma, Thomas Parr Jr., Ph.D.
−Removed: and Timothy Keutzer, who are executive officers but not named executive officers.
−Removed: Equity Compensation Plan Information
−Removed: The following table provides certain aggregate information with respect to all of the Company’s equity compensation plans in effect as of December 31, 2019:
−Removed: Plan category
−Removed: Number of securities to be
−Removed: issued upon exercise of
−Removed: outstanding options,
−Removed: warrants and rights (#)
−Removed: Weighted-average exercise
−Removed: price of outstanding
−Removed: options, warrants and
−Removed: Number of securities
−Removed: remaining for future issuance
−Removed: under equity compensation
−Removed: plans (excluding securities
−Removed: reflected in column (a)) (#)
−Removed: Equity compensation plans approved
−Removed: by stockholders (1)
−Removed: Equity compensation plans not
−Removed: approved by stockholders (2)
−Removed: This plan category consists of the Company’s 2017 Stock Inventive Plan.
−Removed: This plan category consists of the Company’s 2019 Inducement Equity Incentive Plan.
−Removed: Under the Company’s 2017 Stock Inventive Plan, the number of shares of common stock that may be issued automatically increases on an annual basis on the first day of each fiscal year, beginning with the fiscal year until and including the fiscal year ending December 31, 2027, by an amount equal to the lesser of (i) 607,324 shares of common stock, (ii) 4% of the number of outstanding shares of our common stock on such date, or (iii) an amount determined by our Board of Directors or Compensation Committee.
−Removed: Benefits Programs
−Removed: Each named executive employee is eligible to participate in our benefits programs, which include health, life, disability and dental insurance and a 401(k) retirement savings plan.
−Removed: Spero Therapeutics, Inc.’s 2017 Stock Incentive Plan
−Removed: We adopted the Spero Therapeutics, Inc.
−Removed: 2017 Stock Incentive Plan on June 28, 2017, as amended on October 18, 2017 (the “2017 Plan”).
−Removed: The 2017 Plan will expire on June 30, 2027.
−Removed: Under the 2017 Plan, we may grant incentive stock options, non-qualified stock options, restricted and unrestricted stock awards and other stock-based awards.
−Removed: Since its adoption, there have been 3,911,049 shares of our common stock authorized for issuance under the 2017 Plan, which amount includes the automatic increase effective as of January 1, 2020.
−Removed: As of March 1, 2020, a total of 227,721 shares are available for future grant under the 2017 Plan.
−Removed: Our Board of Directors is authorized to administer the 2017 Plan.
−Removed: In accordance with the provisions of the 2017 Plan, our Board of Directors determines the terms of the options and other awards issued pursuant thereto, including the following:
−Removed: which employees, directors and consultants shall be granted awards;
−Removed: the number of shares of common stock subject to options and other awards;
−Removed: the exercise price of each option, which generally shall not be less than fair market value of the common stock on the date of grant;
−Removed: the termination or cancellation provisions applicable to the options;
−Removed: the terms and conditions of other awards, including conditions for repurchase, termination or cancellation, issue price and repurchase price;
−Removed: all other terms and conditions upon which each award may be granted in accordance with the 2017 Plan.
−Removed: No participant may receive awards for more than 1,000,000 shares of our common stock in any fiscal year.
−Removed: In addition, our Board of Directors or any committee to which our Board of Directors delegates authority may, with the consent of the affected plan participants, amend outstanding awards consistent with the terms of the 2017 Plan.
−Removed: Upon a merger, consolidation, or sale of all or substantially all of our assets, our Board of Directors or any committee to which our Board of Directors delegates authority, or the Board of Directors of any corporation assuming the our obligations, may, in its sole discretion, take any one or more of the following actions pursuant to the 2017 Plan, as to some or all outstanding awards, to the extent not otherwise agreed under any individual agreement:
−Removed: provide that outstanding options will be assumed or substituted for options of the successor corporation;
−Removed: provide that the outstanding options must be exercised within a certain number of days, either to the extent the options are then exercisable, or at our Board of Directors’ discretion, any such options being made partially or fully exercisable;
−Removed: terminate outstanding options in exchange for a cash payment of an amount equal to the difference between (a) the consideration payable upon consummation of the corporate transaction to a holder of the number of shares into which such option would have been exercisable to the extent then exercisable, or in our Board of Directors’ discretion, any such options being made partially or fully exercisable, and (b) the aggregate exercise price of those options;
−Removed: provide that outstanding stock grants will be substituted for shares of the successor corporation or consideration payable with respect to our outstanding stock in connection with the corporate transaction;
−Removed: terminate outstanding stock grants in exchange for payment of an amount equal to the consideration payable upon consummation of the corporate transaction to a holder of the same number of shares comprising the stock grant, to the extent the stock grant is no longer subject to any forfeiture or repurchase rights, or at our Board of Directors’ discretion, all forfeiture and repurchase rights being waived upon the corporate transaction.
−Removed: For purposes of determining such payments, in the case of a corporate transaction the consideration for which, in whole or in part, is other than cash, the consideration other than cash shall be valued at the fair market value thereof as determined in good faith by our Board of Directors.
−Removed: In connection with the Company’s 2017 Reorganization, all outstanding incentive units issued under Spero Therapeutics, LLC’s operating agreement were cancelled.
−Removed: Any incentive unit holders who were employees, directors or consultants of the Company at the time of the 2017 Reorganization were issued options under the 2017 Plan with continued vesting on the same schedule and the same terms as such person’s incentive units.
−Removed: Spero Therapeutics, Inc.’s 2019 Inducement Equity Incentive Plan
−Removed: On March 11, 2019, the Board of Directors adopted Spero Therapeutics, Inc.’s 2019 Inducement Equity Incentive Plan (the “2019 Inducement Plan”) and reserved 331,500 shares of our common stock to be used exclusively for grants of awards to individuals that were not previously employees or directors of the Company, as an inducement to the individual’s entry into employment with the Company within the meaning of Rule 5635(c)(4) of the Nasdaq Listing Rules.
−Removed: The 2019 Inducement Plan was adopted without stockholder approval pursuant to Rule 5635(c)(4).
−Removed: The 2019 Inducement Plan provides for the grant of equity-based awards, including options, restricted and unrestricted stock awards, and other stock-based awards, and its terms are substantially similar to the 2017 Plan, but with such other terms and conditions intended to comply with the Nasdaq inducement award exception.
−Removed: As of March 1, 2020, there were 201,800 shares outstanding and 129,700 shares available for grant under the Inducement Plan.
−Removed: Rule 10b5-1 Sales Plans
−Removed: Our directors and executive officers may adopt written plans, known as Rule 10b5-1 plans, in which they will contract with a broker to buy or sell shares of our common stock on a periodic basis.
−Removed: Under a Rule 10b5-1 plan, a broker executes trades pursuant to parameters established by the director or officer when entering into the plan, without further direction from the director or officer.
−Removed: The director or officer may amend or terminate the plan in limited circumstances.
−Removed: Our directors and executive officers may also buy or sell additional shares of our common stock outside of a Rule 10b5-1 plan when they are not in possession of material, nonpublic information.
+Added: The response to this item is incorporated by reference from the discussion responsive thereto under the captions “Executive Officer and Director Compensation” and “Management and Corporate Governance Matters -- Compensation Committee Interlocks and Insider Participation” in our proxy statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.
+Added: Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
+Added: The response to this item is incorporated by reference from the discussion responsive thereto under the captions “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plans and Other Benefits Plans” in our proxy statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.
Certain Relationships and Related Transactions, and Director Independence.
−Removed: Related Party Transactions
−Removed: Except as described below and in the compensation arrangements described in Part II, Item 11 of this Annual Report on Form 10-K, in the fiscal years ended December 31, 2019 and December 31, 2018, there has not been, nor is there currently proposed, any transaction to which we are or were a party in which the amount involved exceeds the lesser of $120,000 and 1% of the average of our total assets at year-end for the last two completed fiscal years, and in which any of our current directors, executive officers, holders of more than 5% of any class of our voting securities or any of their respective affiliates or immediate family members, had, or will have, a direct or indirect material interest.
−Removed: We have entered into indemnification agreements with each of our executive officers and directors.
−Removed: The indemnification agreements, our amended and restated certificate of incorporation and our amended and restated By-Laws require us to indemnify our directors to the fullest extent not prohibited by Delaware law.
−Removed: Subject to certain limitations, our amended and restated certificate of incorporation also requires us to advance expenses incurred by our directors and officers, subject to limited exceptions.
−Removed: We also maintain a general liability insurance policy which covers certain liabilities of directors and officers of the Company arising out of claims based on acts or omissions in their capacities as directors or officers.
−Removed: Indemnification Agreements with Officers and Directors and Directors’ and Officers’ Liability Insurance
−Removed: We have entered into indemnification agreements with each of our executive officers and directors.
−Removed: The indemnification agreements, our amended and restated certificate of incorporation and our amended and restated By-Laws require us to indemnify our directors to the fullest extent not prohibited by Delaware law.
−Removed: Subject to certain limitations, our amended and restated certificate of incorporation also requires us to advance expenses incurred by our directors and officers, subject to limited exceptions.
−Removed: We also maintain a general liability insurance policy which covers certain liabilities of directors and officers of the Company arising out of claims based on acts or omissions in their capacities as directors or officers.
−Removed: Policies and Procedures for Related Party Transactions
−Removed: We have adopted a written policy that requires all future transactions between us and any director, executive officer, holder of 5% or more of any class of our capital stock or any member of the immediate family of, or entities affiliated with, any of them, or any other related persons, as defined in Item 404 of Regulation S-K, or their affiliates, in which the amount involved is equal to or greater than the threshold amount proscribed by Item 404 of Regulation S-K, be approved in advance by our Audit Committee.
−Removed: Any request for such a transaction must first be presented to our Audit Committee for review, consideration and approval.
−Removed: In approving or rejecting any such proposal, our Audit Committee is to consider the relevant facts and circumstances available and deemed relevant to the Audit Committee, including, but not limited to, the extent of the related party’s interest in the transaction, and whether the transaction is on terms no less favorable to us than terms we could have generally obtained from an unaffiliated third party under the same or similar circumstances.
−Removed: Director Independence
−Removed: Our Board of Directors undertook a review of the composition of our Board of Directors and independence of each director.
−Removed: Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, our Board of Directors has determined that each of Milind Deshpande, Ph.D., Jean-Francois Formela, M.D., John C.
−Removed: Pottage, Jr., M.D., Cynthia Smith, Frank E.
−Removed: Thomas and Patrick Vink, M.D.
−Removed: would qualify as “independent” as that term is defined by Nasdaq Listing Rule 5605(a)(2).
−Removed: Ankit Mahadevia, M.D.
−Removed: would not qualify as “independent” under applicable Nasdaq Listing Rules applicable to the Board of Directors generally or to separately designated Board committees because he currently serves as our Chief Executive Officer.
−Removed: In making such determinations, our Board of Directors considered the relationships that each of our non-employee directors has with our company and all other facts and circumstances deemed relevant in determining independence, including the beneficial ownership of our capital stock by each non-employee director.
−Removed: Subject to some exceptions, Nasdaq Listing Rule 5605(a)(2) provides that a director will only qualify as an “independent director” if, in the opinion of our Board of Directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director, and that a director cannot be an “independent director” if (a) the director is, or in the past three years has been, an employee of ours;
−Removed: (b) a member of the director’s immediate family is, or in the past three years has been, an executive officer of ours;
−Removed: (c) the director or a member of the director’s immediate family has received more than $120,000 per year in direct compensation from us within the preceding three years, other than for service as a director or benefits under a tax-qualified retirement plan or non-discretionary compensation (or, for a family member, as a non-executive employee);
−Removed: (d) the director or a member of the director’s immediate family is a current partner of our independent public accounting firm, or has worked for such firm in any capacity on our audit at any time during the past three years;
−Removed: (e) the director or a member of the director’s immediate family is, or in the past three years has been, employed as an executive officer of a company where one of our executive officers serves on the compensation committee;
−Removed: or (f) the director or a member of the director’s immediate family is an executive officer, partner or controlling stockholder of a company that makes payments to, or receives payments from, us in an amount which, in any 12-month period during our past three fiscal years, exceeds the greater of 5% of the recipient’s consolidated gross revenues for that year or $200,000 (except for payments arising solely from investments in our securities or payments under non-discretionary charitable contribution matching programs).
−Removed: Additionally, in order to be considered an independent member of an audit committee under Rule 10A-3 under the Exchange Act, a member of an audit committee may not, other than in his or her capacity as a member of the audit committee, the Board of Directors, or any other committee of the Board of Directors, accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the applicable company or any of its subsidiaries or otherwise be an affiliated person of the applicable company or any of its subsidiaries.
−Removed: To be considered an independent member of the compensation committee under Rule 10C-1 under the Exchange Act, the Board must consider and determine whether a director has a relationship to such company which is material to that director's ability to be independent from management in connection with the duties of a compensation committee member, including, but not limited to:
−Removed: the source of compensation of the director, including any consulting advisory or other compensatory fee paid by such company to the director;
−Removed: and whether the director is affiliated with the company or any of its subsidiaries or affiliates.
+Added: The response to this item is incorporated by reference from the discussion responsive thereto under the captions “Certain Relationships and Related Transactions” and “Management and Corporate Governance Matters” in our proxy statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.
Principal Accounting Fees and Services.
−Removed: PricewaterhouseCoopers LLP was our independent registered public accounting firm for the fiscal years ended December 31, 2019 and 2018.
−Removed: The following table presents fees for professional audit services and other services rendered by PricewaterhouseCoopers LLP to the Company for the fiscal years ended December 31, 2019 and December 31, 2018:
−Removed: Fiscal Year 2019
−Removed: Fiscal Year 2018
−Removed: Audit Fees(1)
−Removed: Audit-Related Fees(2)
−Removed: All Other Fees(4)
−Removed: Audit fees consisted of audit work performed in the preparation of financial statements, the review of the interim consolidated financial statements, and related services that are normally provided in connection with registration statements.
−Removed: Audit related fees consist of fees billed by PricewaterhouseCoopers LLP for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements.
−Removed: Tax fees incurred in 2019 and 2018 consist of fees for professional services, including tax consulting and compliance performed by PricewaterhouseCoopers LLP.
−Removed: All other fees represent payment for access to the PricewaterhouseCoopers LLP online accounting research and financial disclosure databases.
−Removed: Policy on Audit Committee Pre-Approval of Services
−Removed: Consistent with SEC policies regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation and overseeing the work of our independent registered public accounting firm.
−Removed: In recognition of this responsibility, the Audit Committee reviews and pre-approves all audit and permissible non-audit services provided by our independent registered public accounting firm;
−Removed: provided, however, that de minimis non-audit services may instead be approved in accordance with applicable SEC rules.
+Added: The response to this item is incorporated by reference from the discussion responsive thereto under the caption “Independent Public Accountants” in our proxy statement for the 2021 Annual Meeting of Stockholders to be filed with the SEC within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K.
Exhibits, Financial Statement Schedules.
17 unchanged sentences
(Exhibit 3.1)
+Added: Certificate of Designation of Preferences, Rights and Limitations of Series D Convertible Preferred Stock
+Added: (Exhibit 3.1)
Form of Common Stock Certificate
3 unchanged sentences
Description of Registrant’s Securities
+Added: (Exhibit 4.3)
2017 Stock Incentive Plan, as amended
2 unchanged sentences
(Exhibit 10.2)
−Removed: 2019 Inducement Equity Incentive Plan
+Added: 2019 Inducement Equity Incentive Plan, as amended
(Exhibit 10.1)
−Removed: Form of Stock Option Agreement under the 2019 Inducement Equity Incentive Plan
+Added: Form of Stock Option Agreement under the 2019 Inducement Equity Incentive Plan, as amended
(Exhibit 10.2)
2 unchanged sentences
Non-Employee Director Compensation Policy, as amended
−Removed: Employment Agreement, dated October 20, 2017, by and between the Registrant and Ankit Mahadevia, M.D.
(Exhibit 10.6)
−Removed: Employment Agreement, dated October 20, 2017, by and between the Registrant and Joel Sendek
+Added: Employment Agreement, dated October 20, 2017, by and between the Registrant and Ankit Mahadevia, M.D.
(Exhibit 10.5)
−Removed: Employment Agreement, dated October 20, 2017, by and between the Registrant and Thomas Parr Jr., Ph.D.
+Added: Employment Agreement, dated December 9, 2020, by and between the Registrant and Satyavrat Shukla
+Added: Amended and Restated Employment Agreement, dated April 22, 2020, by and between the Registrant and Thomas Parr Jr., Ph.D.
(Exhibit 10.3)
2 unchanged sentences
Employment Agreement, dated December 13, 2017, by and between the Registrant and David Melnick, M.D.
−Removed: Form 10-K (Exhibit 10.9)
+Added: (Exhibit 10.9)
Employment Agreement, dated January 1, 2020, by and between the Registrant and Timothy Keutzer
+Added: (Exhibit 10.12)
+Added: Employment Agreement, dated November 6, 2020, by and between the Registrant and Tamara Joseph
Consulting Agreement, dated April 18, 2019, by and between the Registrant and David P.
+Added: (Exhibit 10.13)
+Added: Consulting Agreement, dated November 4, 2019, by and between the Registrant and Danforth Advisors, LLC
+Added: (Exhibit 10.1)
Lease Agreement, dated August 24, 2015, by and between the Registrant and U.S.
7 unchanged sentences
(Exhibit 99.1)
+Added: Third Amendment to Lease Agreement, dated May 4, 2020, by and between the Registrant and U.S.
+Added: REIF Central Plaza Massachusetts, LLC
+Added: (Exhibit 10.4)
Sublease, dated July 6, 2016, by and between the Registrant and Tetraphase Pharmaceuticals, Inc.
8 unchanged sentences
(Exhibit 10.1)
−Removed: License Agreement, dated January 4, 2019, by and between New Pharma License Holdings Limited and Everest Medicines II Limited
−Removed: (Exhibit 10.20)
+Added: Amended and Restated License Agreement, dated January 15, 2021, by and between the Registrant and Everest Medicines II Limited
Exchange Agreement, dated November 15, 2018, by and among Spero Therapeutics, Inc.
4 unchanged sentences
(Exhibit 1.2)
+Added: Controlled Equity Offering Sales Agreement, dated March 11, 2021, by and between the Registrant and Cantor Fitzgerald & Co.
Securities Purchase Agreement, dated June 12, 2019, by and between the Registrant and Novo Holdings A/S
5 unchanged sentences
List of Subsidiaries of the Registrant
+Added: (Exhibit 21.1)
Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm
1 unchanged sentence
Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
−Removed: Certification of Principal Executive Officer pursuant to 18 U.S.C.
−Removed: Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
−Removed: Certification of Principal Financial Officer pursuant to 18 U.S.C.
−Removed: Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
−Removed: XBRL Instance Document
−Removed: XBRL Taxonomy Extension Schema Document
−Removed: XBRL Taxonomy Extension Calculation Linkbase Document
−Removed: XBRL Taxonomy Extension Definition
−Removed: XBRL Taxonomy Extension Label Linkbase Document
−Removed: XBRL Taxonomy Presentation Linkbase Document
+Added: Certification pursuant to 18 U.S.C.
+Added: Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by Principal Executive Officer and Principal Financial Officer
+Added: XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
+Added: Inline XBRL Taxonomy Extension Schema Document
+Added: Inline XBRL Taxonomy Extension Calculation Linkbase Document
+Added: Inline XBRL Taxonomy Extension Definition Linkbase Document
+Added: Inline XBRL Taxonomy Extension Label Linkbase Document
+Added: Inline XBRL Taxonomy Extension Presentation Linkbase Document
+Added: Cover Page Interactive Data File (embedded within the Inline XBRL document)
Confidential treatment received as to portions of the exhibit.
Confidential materials omitted and filed separately with the SEC.
+Added: Certain confidential portions of this Exhibit were omitted by means of marking such portions with brackets (“[***]”) because the identified confidential portions (i) are not material and (ii) would be competitively harmful if publicly disclosed.
Management contract or compensatory plan.
−Removed: Confidential treatment requested for portions of this exhibit.
−Removed: Confidential materials omitted and filed separately with the SEC.
+Added: The certification attached as Exhibit 32 that accompanies 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 Spero Therapeutics, Inc.
+Added: 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 Form 10-K, irrespective of any general incorporation language contained in such filing.
Form 10-K Summary.
7 unchanged sentences
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints each of Ankit Mahadevia, M.D.
−Removed: and Stephen J.
−Removed: DiPalma his true and lawful attorney-in-fact and agent, with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitutes or substitute, may lawfully do or cause to be done by virtue hereof.
+Added: and Sath Shukla his true and lawful attorney-in-fact and agent, with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitutes or substitute, may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, each of the undersigned has executed this Power of Attorney as of the date indicated opposite his name.
5 unchanged sentences
(Principal Executive Officer)
−Removed: /s/ Stephen J.
−Removed: Interim Chief Financial Officer and Treasurer
+Added: /s/ Sath Shukla
+Added: Chief Financial Officer and Treasurer
March 11, 2021
6 unchanged sentences
Jean-François Formela, M.D.
+Added: /s/ Scott Jackson
+Added: March 11, 2021
+Added: Scott Jackson
Pottage, M.D.
9 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.