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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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Isis Pharmaceuticals, Inc.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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Payment of Filing Fee (Check the appropriate box):
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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(1)
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Title of each class of securities to which transaction applies:
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Proposed maximum aggregate value of transaction:
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Total fee paid:
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Fee paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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Amount Previously Paid:
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Form, Schedule or Registration Statement No.:
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Date Filed:
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Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.
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Sincerely,
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B. Lynne Parshall
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Secretary
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Date
:
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Tuesday, June 10, 2014
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Time
:
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2:00 p.m., Pacific Time
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Place
:
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Isis Pharmaceuticals, Inc.
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2855 Gazelle Court
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Carlsbad, CA 92010
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·
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Proposal 1
:
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elect Spencer R. Berthelsen, B. Lynne Parshall and Joseph H. Wender to serve as Directors for a three-year term;
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·
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Proposal 2
:
|
make an advisory vote, ratifying the appointment of Breaux B. Castleman to fill a vacancy on our Board of Directors for a one-year term;
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·
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Proposal 3
:
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make an advisory vote, ratifying the appointment of Joseph Loscalzo to fill a vacancy on our Board of Directors for a two-year term;
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·
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Proposal 4
:
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approve an amendment to the Company’s Restated Certificate of Incorporation to increase the authorized number of shares of Common Stock from 200,000,000 to 300,000,000 shares;
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·
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Proposal 5
:
|
approve an amendment and restatement of our 2002 Non-Employee Directors’ Stock Option Plan to (i) increase the non-discretionary stock option grants for new Directors to 32,000 shares and non-discretionary annual grants to all non-employee Directors to 16,000 shares, with a corresponding RSU award, and (ii) update the provision prohibiting our Board of Directors from repricing or cancelling outstanding options in exchange for cash or other stock awards without obtaining the approval of our stockholders;
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·
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Proposal 6
:
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make an advisory vote on executive compensation;
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·
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Proposal 7
:
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ratify the Audit Committee’s selection of Ernst & Young LLP as independent auditors for our 2014 fiscal year; and
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·
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Transact any other business that may be properly presented at the Annual Meeting.
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By order of the Board of Directors,
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B. Lynne Parshall
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Secretary
|
1 | Any information that is included on or linked to our website is not part of this Proxy Statement or any registration statement or report that incorporates this Proxy Statement by reference. |
|
·
|
Proposal 1
:
|
elect Spencer R. Berthelsen, B. Lynne Parshall and Joseph H. Wender to serve as Directors for a three-year term;
|
|
·
|
Proposal 2
:
|
make an advisory vote, ratifying the appointment of Breaux B. Castleman to fill a vacancy on our Board of Directors for a one-year term;
|
|
·
|
Proposal 3
:
|
make an advisory vote, ratifying the appointment of Joseph Loscalzo to fill a vacancy on our Board of Directors for a two-year term;
|
|
·
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Proposal 4
:
|
approve an amendment to the Company’s Restated Certificate of Incorporate to increase the authorized number of shares of Common Stock from 200,000,000 to 300,000,000 shares;
|
|
·
|
Proposal 5
:
|
approve an amendment and restatement of our 2002 Non-Employee Directors’ Stock Option Plan to (i) increase the non-discretionary stock option grants for new Directors to 32,000 shares and non-discretionary annual grants to all non-employee Directors to 16,000 shares, with a corresponding RSU award, and (ii) update the provision prohibiting our Board from repricing or cancelling outstanding options in exchange for cash or other stock awards without obtaining the approval of our stockholders;
|
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·
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Proposal 6
:
|
make an advisory vote on executive compensation; and
|
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·
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Proposal 7
:
|
ratify the Audit Committee’s selection of Ernst & Young LLP as independent auditors for our 2014 fiscal year.
|
· | vote through the Internet by following the instructions included with your Notice or proxy card; |
· | if you have received proxy materials electronically or by mail, you may vote by telephone by following the instructions included with your proxy card; |
· | complete, sign, date and return your proxy card in the postage paid envelope provided; or |
· | attend the 2014 Annual Meeting and vote in person. |
· | “For” the election of the nominees for Director named in the Proxy Statement; |
· | “For” the ratification, on an advisory basis, of the appointment of Mr. Castleman to fill a vacancy on our Board for a one-year term; |
· | “For” the ratification, on an advisory basis, of the appointment of Dr. Loscalzo to fill a vacancy on our Board for a two-year term; |
· | “For” the approval of the amendment to our Restated Certificate of Incorporation to increase the authorized number of shares of Common Stock; |
· | “For” the approval of the amendment and restatement of the 2002 Non-Employee Directors’ Stock Option Plan; |
· | “For” the approval, on an advisory basis, of executive compensation; and |
· | “For” the ratification of the Audit Committee’s selection of Ernst & Young LLP as independent auditors for our 2014 fiscal year. |
· | you may mail another proxy marked with a later date; |
· | you may revoke it through the Internet; |
· | you may notify our Secretary in writing sent to 2855 Gazelle Court, Carlsbad, California 92010 that you wish to revoke your proxy before the Annual Meeting takes place; or |
· | you may vote in person at the Annual Meeting. Attendance at the meeting will not , by itself, revoke a proxy. |
· | Proposal 1: For the election of Directors in an uncontested election, a Director nominee must receive a majority of the votes cast in person or by proxy in the election such that the number of shares voted “For” the nominee must exceed 50% of the votes cast with respect to that Director. Only “For” and “Withhold” votes will affect the outcome. Abstentions and broker non-votes will have no effect. |
· | Proposal 2: We will consider the advisory vote on the ratification of the appointment of Mr. Castleman to fill a vacancy on the Board to be approved if such ratification receives “For” votes from the holders of a majority of shares either present in person or represented by proxy and entitled to vote. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will have no effect. |
· | Proposal 3: We will consider the advisory vote on the ratification of the appointment of Dr. Loscalzo to fill a vacancy on the Board to be approved if such ratification receives “For” votes from the holders of a majority of shares either present in person or represented by proxy and entitled to vote. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will have no effect. |
· | Proposal 4: To be approved, the amendment to our Restated Certificate of Incorporation to increase the authorized number of shares of Common Stock must receive “For” votes from the holders of a majority of our shares outstanding as of the record date. If you mark your proxy to “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will also have the same effect as “Against” votes. |
· | Proposal 5: To be approved, the amendment of our 2002 Non-Employee Directors’ Stock Option Plan must receive “For” votes from the holders of a majority of shares either present in person or represented by proxy and entitled to vote. If you mark your proxy to “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will have no effect. |
· | Proposal 6: We will consider the advisory approval of the compensation of our executive officers to be approved if it receives “For” votes from the holders of a majority of shares either present in person or represented by proxy and entitled to vote. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will have no effect. |
· | Proposal 7: To be approved, the ratification of the selection of Ernst & Young LLP as our independent auditors for our 2014 fiscal year, must receive “For” votes from the holders of a majority of shares present in person or by proxy and entitled to vote. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will have no effect. |
· | delivering the Proxy Statement, Annual Report and related materials by email to our stockholders; |
· | stockholder voting online; |
· | helping the environment by decreasing the use of paper documents; |
· | reducing the amount of bulky documents stockholders receive; and |
· | reducing our printing and mailing costs associated with more traditional delivery methods. |
· | meets the applicable rules and regulations regarding “independence,” including, but not limited to, Rule 5605(a)(2) of the NASDAQ listing standards and applicable SEC rules and regulations; |
· | is not an officer or employee of Isis; and |
· | is free of any relationship that would interfere with his individual exercise of independent judgment with regard to Isis. |
Name
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Audit
|
Compensation
|
Nominating, Governance and Review
|
Agenda
|
Attended 2013 Annual Meeting
|
|||||
Dr. Spencer R. Berthelsen
|
--
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X*
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X*
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--
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X
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|||||
Mr. Breaux B. Castleman
|
X
(1)
|
--
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--
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--
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X
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|||||
Dr. Stanley T. Crooke
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--
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--
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--
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X
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X
|
|||||
Mr. Joseph Klein
|
X
|
--
|
--
|
--
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X
|
|||||
Dr. Joseph Loscalzo
(2)
|
--
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--
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--
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--
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N/A
|
|||||
Mr. Frederick T. Muto
(3)
|
--
|
--
|
--
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X
|
--
|
|||||
Ms. B. Lynne Parshall
|
--
|
--
|
--
|
X
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X
|
|||||
Dr. John C. Reed
(4)
|
--
|
X
|
--
|
--
|
--
|
|||||
Mr. Joseph H. Wender
|
X*
|
X
|
X
|
X
|
--
|
|||||
Total meetings in fiscal year 2013
|
4
|
5
(5)
|
3
|
4
|
|
(1) | Mr. Castleman was appointed to the Audit Committee, replacing Dr. Berthelsen, at the September 2013 Board meeting. |
(2) | Dr. Loscalzo was appointed to the Board on February 3, 2014. |
(3) | Mr. Muto serves as counsel, in a non-voting capacity, to the Nominating, Governance and Review Committee and as an advisor to the Compensation Committee. |
(4) | On February 12, 2013, Dr. Reed resigned as a member of the Board due to his commitments as Head of Roche Pharma Research and Early Development and as a member of Roche’s Corporate Executive Committee. Mr. Wender replaced Dr. Reed as a member of the Nominating, Governance and Review Committee. |
(5) | The Compensation Committee also acted by written consent 12 times. Our Compensation Committee acts by unanimous written consent each month to confirm stock options and RSUs granted in connection with new hires and promotions. |
Name
|
Audit
|
Compensation
|
Nominating, Governance and Review
|
Agenda
|
Science/ Medical
|
|||||
Dr. Spencer R. Berthelsen
|
--
|
X*
|
X*
|
--
|
X
|
|||||
Mr. Breaux B. Castleman
|
X
|
--
|
X
|
--
|
--
|
|||||
Dr. Stanley T. Crooke
|
--
|
--
|
--
|
X
|
X*
|
|||||
Mr. Joseph Klein
|
X
|
--
|
--
|
--
|
--
|
|||||
Dr. Joseph Loscalzo
|
--
|
--
|
--
|
X
|
X
|
|||||
Mr. Frederick T. Muto
|
--
|
--
|
--
|
X
|
--
|
|||||
Ms. B. Lynne Parshall
|
--
|
--
|
--
|
X
|
--
|
|||||
Mr. Joseph H. Wender
|
X*
|
X
|
X
|
--
|
--
|
· | reviews the annual and quarterly financial statements and oversees the annual and quarterly financial reporting processes, including sessions with the auditors in which Isis’ employees and management are not present; |
· | selects and hires our independent auditors; |
· | oversees the independence of our independent auditors; |
· | evaluates our independent auditors’ performance; and |
· | has the authority to hire its own outside consultants and advisors, if necessary. |
· | reviewing our annual budget with management and, if acceptable, recommending the budget to the Board for approval; |
· | setting and approving changes to our investment policy; |
· | receiving and considering our independent auditors’ comments as to the audit of the financial statements and internal controls, adequacy of staff and management performance and procedures in connection with internal controls; |
· | reviewing and, if appropriate, approving related party transactions; |
· | establishing and enforcing procedures for the receipt, retention and treatment of complaints regarding accounting or auditing improprieties; and |
· | pre-approving all audit and non-audit services provided by our independent auditors that are not prohibited by law. |
· | do not accept any consulting, advisory or other compensatory fee from us, except in connection with their service as a Director; |
· | are not an affiliate of Isis or one of its subsidiaries; and |
· | meet all of the other NASDAQ independence requirements. |
2
|
Any information that is included on or linked to our website is not part of this Proxy Statement or any registration statement or report that incorporates this Proxy Statement by reference.
|
· | interviewing, evaluating, nominating and recommending individuals for membership on our Board, and as part of this process, the Nominating, Governance and Review Committee will consider nominees recommended by our stockholders; |
· | on an annual basis, reviewing the performance of the Board and its committees, including evaluating the Board’s ability to function as a group and the integrity, independence and competency of the individual Board members; |
· | periodically reviewing our policies and procedures and recommending appropriate changes, if any; |
· | annually reviewing and assessing the adequacy of our corporate governance guidelines and recommending any proposed changes to the Board for approval; and |
· | performing such other functions as may be necessary or convenient for the efficient discharge of the foregoing. |
· | members must be able to read and understand basic financial statements; |
· | members must demonstrate high personal integrity and ethics; |
· | members cannot serve as a director on the board of more than seven other publicly traded companies; |
· | members cannot serve more than ten consecutive terms on the Board; and |
· | members cannot run for re-election or serve on the Board once they have reached the age of 80. |
· | possessing relevant expertise to offer advice and guidance to management; |
· | having sufficient time to devote to Isis’ affairs; |
· | demonstrating excellence in his or her field; |
· | having sound business judgment; and |
· | being committed to rigorously represent the long-term interests of our stockholders. |
3
|
Any information that is included on or linked to our website is not part of this Proxy Statement or any registration statement or report that incorporates this Proxy Statement by reference.
|
· | the name, age, business address and residence address of the nominee; |
· | the principal occupation or employment of the nominee; |
· | the stock ownership in Isis of the nominee; |
· | the stock ownership in Isis of the stockholder making the nomination, including any trading in derivative securities that may disguise ownership occurring within the last 12 months; |
· | the information relating to the nominee that is required to be disclosed in solicitations of proxies under applicable securities laws; |
· | the nominee’s written consent to being named in the Proxy Statement as a nominee and to serving as a Director if elected; |
· | other information as we may reasonably require to determine the eligibility of the proposed nominee to serve as an independent Director or that could be material to a reasonable stockholder’s understanding of the independence of the proposed nominee; and |
· | any voting commitments the nominee has to third parties. |
4
|
Any information that is included on or linked to our website is not part of this Proxy Statement or any registration statement or report that incorporates this Proxy Statement by reference.
|
· | retain the services of persons now serving as our non-employee Directors; |
· | attract and retain the services of persons capable of serving on our Board; and |
· | incentivize our non-employee Directors to exert maximum efforts to promote our success. |
· | Initial Grants |
o | an initial grant of a stock option to purchase shares of common stock to each person when he or she first becomes a non-employee Director of Isis equal to 30,000 multiplied by the Option Allocation Percentage, and |
o | an initial grant of an RSU award to each person when he or she first becomes a non-employee Director of Isis in an amount equal to 30,000 multiplied by the RSU Allocation Percentage, as further adjusted by multiplying by the RSU:Option Value Ratio. |
o | For example, using the Option Allocation Percentage of 75%, RSU Allocation Percentage of 25%, and the RSU:Option Value Ratio of 50% that were approved for 2013 by the Compensation Committee, a new non-employee Director who joined the Board in 2013 received an initial stock option to purchase 22,500 shares of common stock (i.e. 30,000 x 75%) and an RSU award worth 3,750 shares of common stock (i.e. 30,000 x 25% x 50%). |
· | Annual Grants |
o | an annual grant, on July 1, or the next business day should such date be on a Saturday, Sunday or holiday, of a stock option to purchase shares of common stock to each non-employee Director equal to 15,000 multiplied by the Option Allocation Percentage, and |
o | an annual grant, on July 1, or the next business day should such date be on a Saturday, Sunday or holiday, of an RSU award to each non-employee Director in an amount equal to 15,000 multiplied by the RSU Allocation Percentage, as further adjusted by multiplying by the RSU:Option Value Ratio. |
o | For example, using the Option Allocation Percentage of 75%, RSU Allocation Percentage of 25%, and the RSU:Option Value Ratio of 50% that were approved for 2013 by the Compensation Committee, on July 1, 2013, each non-employee Director received a stock option to purchase 11,250 shares of common stock (i.e. 15,000 x 75%) and an RSU award worth 1,875 shares of common stock (i.e. 15,000 x 25% x 50%). |
· | Initial Grants |
o | an initial grant of a stock option to purchase 32,000 shares of common stock to each person when he or she first becomes a non-employee Director, and |
o | an initial grant of an RSU award to each person when he or she first becomes a non-employee Director in an amount equal to 32,000 multiplied by the then applicable RSU/Option Factor. |
o | For example, using the RSU/Option Factor of 1/6 that was approved by the Compensation Committee and is currently in place, a new non-employee Director joining the Board after the 2014 Annual Meeting of Stockholders would receive an initial stock option to purchase 32,000 shares of common stock and an RSU award worth 5,333 shares of common stock (i.e. 32,000 x 1/6). |
· | Annual Grants |
o | an annual grant, on July 1, or the next business day should such date be on a Saturday, Sunday or holiday, of a stock option to purchase 16,000 shares of common stock to each non-employee Director, and |
o | an annual grant, on July 1, or the next business day should such date be on a Saturday, Sunday or holiday, of an RSU award to each non-employee Director in an amount equal to 16,000 multiplied by the then applicable RSU/Option Factor. |
o | For example, using the RSU/Option Factor of 1/6 that was approved by the Compensation Committee and is currently in place, on July 1, 2014, each non-employee Director would receive a stock option to purchase 16,000 shares of common stock and an RSU award worth 2,667 shares of common stock (i.e. 16,000 x 1/6). |
· | an optionholders’ spouse, children (by birth or adoption), stepchildren, grandchildren, or parents; |
· | a trust or other entity established solely for the optionholders’ benefit or the benefit of the optionholders’ spouse, children (by birth or adoption), stepchildren, grandchildren, or parents for estate planning purposes; or |
· | an organization which is exempt from taxation under Section 501(c)(3) of the Code or to which tax-deductible charitable contributions may be made under Section 170 of the Code. |
NEW PLAN BENEFITS
AMENDED AND RESTATED 2002 NON-EMPLOYEE DIRECTORS’ STOCK OPTION PLAN
|
||
Name of Non-Employee Director
|
Number of Option Shares
(16,000)
|
Number of Restricted Stock Unit Awards
(16,000 x 1/6)
|
Spencer R. Berthelsen
|
16,000
|
2,667
|
Breaux B. Castleman
|
16,000
|
2,667
|
Joseph Klein, III
|
16,000
|
2,667
|
Joseph Loscalzo
|
16,000
|
2,667
|
Frederick T. Muto
|
16,000
|
2,667
|
Joseph H. Wender
|
16,000
|
2,667
|
Non-Employee Directors as a Group
|
96,000
|
16,002
|
Plan Category
|
Number of Shares
to be Issued
Upon Exercise of
Outstanding Options
|
Weighted Average
Exercise Price of
Outstanding Options
|
Number of Shares
Remaining
Available for
Future Issuance
|
|||||||||
Equity compensation plans approved by stockholders(a)
|
7,078,280
|
|
$12.11
|
5,715,176
|
(c) | |||||||
Equity compensation plans not approved by stockholders(b)
|
630,086
|
|
$14.84
|
—
|
||||||||
|
||||||||||||
Total
|
7,708,366
|
|
$12.33
|
5,715,176
|
(a) | Consists of four Isis plans: 1989 Stock Option Plan, Amended and Restated 2002 Non-Employee Directors’ Stock Option Plan, 2011 Equity Incentive Plan and ESPP. |
(b) | Consists of the 2000 Broad-Based Equity Incentive Plan, more fully described below. The 2000 Broad-Based Equity Incentive Plan expired on January 5, 2010. |
(c) | Of these shares, 264,275 remained available for purchase under the ESPP as of December 31, 2013. The ESPP incorporates an evergreen formula pursuant to which on January 1 of each year, we automatically increase the aggregate number of shares reserved for issuance under the plan by 150,000 shares. |
· | a sale, lease or other disposition of all or substantially all of our assets; |
· | a merger or consolidation in which we are not the surviving corporation; or |
· | reverse merger in which we are the surviving corporation but the shares of common stock outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise; |
What We Do
|
What We Don't Do
|
|||
ü
|
Demand more of every employee: more commitment, more knowledge, more intensity, more innovation
|
û
|
Do not guarantee a cash bonus – cash bonuses can, and have been, zero
|
|
ü
|
Reward productivity and performance
|
û
|
Do not provide perquisites for any employees
|
|
ü
|
Recognize the value of long-term employees and low turnover
|
û
|
Do not provide “gross-up” payments, other than for relocation
|
|
ü
|
Use a balanced mix of fixed and variable cash incentives and long-term equity
|
û
|
Do not allow shorting and hedging against our stock
|
|
ü
|
Evaluate compensation compared to the 50
th
percentile of our peer group
|
û
|
Do not reprice or “cash-out” stock options without stockholder approval
|
|
ü
|
Design our compensation philosophy and objectives to mitigate unnecessary or imprudent business risk taking
|
|
|
|
ü
|
Set explicit and demanding objectives at thebeginning of each year from which we measure performance for the year
|
|
|
|
ü
|
Place a maximum limit on Performance MBOs
|
|||
ü
|
Set a strict budget for equity awards and salary increases
|
|
|
|
ü
|
Set the size of equity awards based on individual and company performance
|
|
|
|
ü
|
Require minimum vesting periods for equity awards
|
|
|
|
ü
|
Require our executive officers and non-employee Board members to hold shares received from their RSUs until they meet certain ownership thresholds or no longer serve the company
|
|
|
|
ü
|
Require our employees to hold ESPP shares for a minimum of six months
|
|
|
|
ü
|
Require our executive officers, VPs and many other employees to trade Isis’ stock through Rule 10b5-1 trading plans
|
|
|
|
ü
|
Use a “double trigger” for cash payments for change of control
|
|
|
|
ü
|
Use an executive “claw-back” policy
|
|
|
|
ü
|
Use an independent compensation consultant engaged by the Compensation Committee
|
|
|
· | each Director and nominee for Director; |
· | each executive officer named in the Summary Compensation Table under “Executive Compensation--Compensation of Executive Officers”; |
· | all Directors and executive officers as a group; and |
· | every entity that we know beneficially owns more than five percent of our common stock. |
|
Beneficial Ownership
(1)
|
|||||||
Beneficial Owner
|
Number of Shares
|
Percent of Total
(2)
|
||||||
FMR LLC
(3)
|
17,679,361
|
15.0
|
||||||
245 Summer Street
|
||||||||
Boston, MA 02210
|
||||||||
|
||||||||
Artisan Partners Holdings LP
(4)
|
9,778,160
|
8.3
|
||||||
875 East Wisconsin Avenue, Suite 800
|
||||||||
Milwaukee, WI 53202
|
||||||||
|
||||||||
BlackRock, Inc.
(5)
|
8,844,551
|
7.5
|
||||||
40 East 52
nd
Street
|
||||||||
New York, NY 10022
|
||||||||
|
||||||||
The Vanguard Group
(6)
|
7,681,946
|
6.5
|
||||||
100 Vanguard Boulevard
|
||||||||
Malvern, PA 19355
|
||||||||
|
||||||||
ClearBridge Investment, LLC
(7)
|
7,197,661
|
6.1
|
||||||
620 8
th
Avenue
|
||||||||
New York, NY 10018
|
||||||||
|
||||||||
BB Biotech AG
(8)
|
6,417,548
|
5.5
|
||||||
Vordergasse 3
|
||||||||
CH-8200 Schaffhausen, Switzerland
|
||||||||
|
||||||||
Spencer R. Berthelsen
(9)
|
136,246
|
*
|
||||||
Breaux B. Castleman
|
0
|
*
|
||||||
Stanley T. Crooke
(10)
|
1,220,849
|
1.0
|
||||||
Joseph Klein, III
(11)
|
2,413
|
*
|
||||||
Joseph Loscalzo
|
0
|
*
|
||||||
Frederick T. Muto
(12)
|
98,376
|
*
|
||||||
B. Lynne Parshall
(13)
|
36,000
|
*
|
||||||
Joseph H. Wender
(14)
|
107,998
|
*
|
||||||
C. Frank Bennett
(15)
|
129,882
|
*
|
||||||
Richard S. Geary
(16)
|
13,163
|
*
|
||||||
Elizabeth L. Hougen
(17)
|
71,330
|
*
|
||||||
All Directors and executive officers as a group (thirteen persons)
(18)
|
1,892,647
|
1.6
|
(1) | We base this table upon information supplied by officers, Directors, principal stockholders and Form 3s, Form 4s, Form 5s, Schedules 13D and 13G filed with the SEC. Unless otherwise indicated in the footnotes to this table and subject to community property laws where applicable, we believe that each of the stockholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned. |
(2) | Applicable percentages are based on 117,541,860 shares of common stock outstanding on March 31, 2014, adjusted as required by rules promulgated by the SEC. |
(3) | Fidelity Management & Research Company ("Fidelity"), a wholly- owned subsidiary of FMR LLC and an investment adviser registered under Section 203 of the Investment Advisers Act of 1940, is the beneficial owner of 14,704,780 shares or 12.590% of the Common Stock outstanding of Isis as a result of acting as investment adviser to various investment companies registered under Section 8 of the Investment Company Act of 1940. The number of shares of Common Stock of Isis owned by the investment companies at December 31, 2013 included 481,095 shares of Common Stock resulting from the assumed conversion of $8,000,000 principal amount of ISIS PHARMA CV 2.75% 10/01/19 (60.1368 shares of Common Stock for each $1,000 principal amount of debenture). |
(4) | The shares reported herein have been acquired on behalf of discretionary clients of Artisan Partners Limited Partnership ("APLP"), Artisan Investments GP LLC ("Artisan Investments") Artisan Partners Holdings LP ("Artisan Holdings") Artisan Partners Asset Management Inc. ("APAM") Artisan Partners Funds, Inc. ("Artisan Funds"). Artisan Holdings is the sole limited partner of APLP and the sole member of Artisan Investments; Artisan Investments is the general partner of APLP; APAM is the general partner of Artisan Holdings. APLP holds 9,778,160 shares, including 5,597,870 shares on behalf of Artisan Funds. Persons other than APLP are entitled to receive all dividends from, and proceeds from the sale of, those shares. |
(5) | Various persons at BlackRock, Inc. have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of shares of our common stock. |
(6) | The Vanguard Group has sole voting power to direct the vote of 159,970 shares, sole power to dispose or direct the disposition of 7,529,476 shares, shared dispositive power for 152,470 shares. Vanguard Fiduciary Trust Company , a wholly-owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 152,470 shares or 0.13% of the Common Stock outstanding of Isis as a result of its serving as investment manager of collective trust accounts. Vanguard Investments Australia, Ltd., a wholly-owned subsidiary of The Vanguard Group, Inc., is the beneficial owner of 7,500 shares of Isis’ Common Stock outstanding as a result of its serving as investment manager of Australian investment offerings. |
(7)
|
ClearBridge Advisors, LLC, is an investment adviser registered under the Investment Advisers Act
.
ClearBridge Advisors has sole voting power to direct the vote of 7,005,575 shares and sole power to dispose or direct the disposition of 7,197,661 shares.
|
(8) | BB Biotech shares voting and dispositive powers for its shares with Biotech Target N.V., a wholly-owned subsidiary of BB Biotech AG. |
(9) | Includes 70 shares owned by Dr. Berthelsen’s daughter for which he disclaims beneficial ownership. Includes 96,563 shares of common stock issuable upon exercise of options held by Dr. Berthelsen that are exercisable on or before May 30, 2014. |
(10) | Includes shares of common stock held by Dr. Crooke and 437,837 shares of common stock issuable upon exercise of options held by Dr. Crooke that are exercisable on or before May 30, 2014. Also includes 50,053 shares of common stock issuable upon exercise of options held by Rosanne Crooke, Dr. Crooke’s wife, which are exercisable on or before May 30, 2014. Dr. Crooke disclaims beneficial ownership of the shares of common stock owned and issuable upon exercise of options held by his wife. |
(11) | Includes 100 shares of common stock beneficially owned by Mr. Klein’s son. |
(12) | Includes 1,500 shares of common stock beneficially owned through the Cooley LLP Salary Deferral and Profit Sharing Plan and 96,563 shares of common stock issuable upon exercise of options held by Mr. Muto that are exercisable on or before May 30, 2014. |
(13) | Includes 31,978 shares of common stock issuable upon exercise of options held by Ms. Parshall that are exercisable on or before May 30, 2014. |
(14) | Includes 71,563 shares of common stock issuable upon exercise of options held by Mr. Wender that are exercisable on or before May 30, 2014. |
(15) | Includes 125,546 shares of common stock issuable upon exercise of options held by Dr. Bennett that are exercisable on or before May 30, 2014. |
(16) | Includes 8,208 shares of common stock issuable upon exercise of options held by Dr. Geary that are exercisable on or before May 30, 2014. |
(17) | Includes 70,098 shares of common stock issuable upon exercise of options held by Ms. Hougen that are exercisable on or before May 30, 2014. |
(18) | Includes an aggregate of 1,059,633 shares issuable upon exercise of options held by all current Directors and executive officers as a group that are exercisable on or before May 30, 2014. |
Since inception, the Isis mission has been to create a new, more efficient technology for drug discovery and development, antisense technology, and exploit that technology to create a pipeline of first-in-class medicines to treat a wide range of diseases. Today, thanks to the innovation and perseverance of Isis, we believe antisense technology is taking its place as the third platform for drug discovery alongside small molecules and protein therapeutics.
Isis is focused on innovation. Based on the efficiency of antisense technology, Isis has implemented a unique business strategy that is intended to assure long-term innovation. Isis has created a unique innovation-focused, science–driven, culture that couples with its technology and business model to assure long-term productivity and a commitment to the patients we serve.
|
|
Through the efficiency of our technology platform and business strategy we have built a pipeline of 32 drugs in development with fewer than 370 employees, representing a ratio of 1 drug : 12 employees.
|
•
|
create and constantly advance a new more efficient drug discovery platform, antisense technology;
|
•
|
create a unique business model and culture committed to creating long-term value through innovation;
|
•
|
broaden, deepen and advance our pipeline of antisense drugs;
|
•
|
demand more of every employee - more commitment, more knowledge, more intensity, more innovation;
|
•
|
aggressively manage average and below average performance so every employee produces more; and
|
•
|
demand great performance and pay for that performance.
|
What We Do | What We Don’t Do | |||
ü
|
Demand more of every employee: more commitment, more knowledge, more intensity, more innovation
|
û
|
Do not guarantee a cash bonus – cash bonuses can, and have been, zero
|
|
ü
|
Reward productivity and performance
|
û
|
Do not provide perquisites for any employees
|
|
ü
|
Recognize the value of long-term employees and low turnover
|
û
|
Do not provide “gross-up” payments, other than for relocation
|
|
ü
|
Use a balanced mix of fixed and variable cash incentives and long-term equity
|
û
|
Do not allow shorting and hedging against our stock
|
|
ü
|
Evaluate compensation compared to the 50
th
percentile of our peer group
|
û
|
Do not reprice or “cash-out” stock options without stockholder approval
|
|
ü
|
Design our compensation philosophy and objectives to mitigate unnecessary or imprudent business risk taking
|
|
|
|
ü
|
Set explicit and demanding objectives at the beginning of each year from which we measure performance for the year
|
|
|
|
ü
|
Place a maximum limit on Performance MBOs
|
|
|
|
ü
|
Set a strict budget for equity awards and salary increases
|
|
|
|
ü
|
Set the size of equity awards based on individual and company performance
|
|
|
|
ü
|
Require minimum vesting periods for equity awards
|
|
|
|
ü
|
Require our executive officers and non- employee Board members to hold shares received from their RSUs until they meet certain ownership thresholds or no longer serve the company
|
|
|
|
ü
|
Require our employees to hold ESPP shares for a minimum of six months
|
|
|
|
ü
|
Require our executive officers, VPs and many other employees to trade Isis’ stock through Rule 10b5-1 trading plans
|
|
|
|
ü
|
Use a “double trigger” for cash payments for change of control
|
|
|
|
ü
|
Use an executive “claw-back” policy
|
|
|
|
ü
|
Use an independent compensation consultant engaged by the Compensation Committee
|
|
|
· | reviewing and approving overall compensation strategy; |
· | reviewing and approving corporate performance goals and objectives relevant to the compensation of our executive officers; |
· | evaluating and recommending to the Board the compensation plans and programs advisable for Isis, as well as modifying or terminating existing plans and programs; |
· | establishing policies with respect to stock compensation arrangements; |
· | reviewing and approving compensation arrangements for our executive officers, including our Chief Executive Officer; |
· | reviewing and approving compensation arrangements for our Directors; |
· | administering our stock-based awards and ESPP; |
· | evaluating risks associated with our compensation policies and practices and assessing whether these risks are reasonably likely to have a material adverse effect on us; |
· | selecting and retaining a qualified, independent compensation consultant; |
· | performing other functions as may be necessary or convenient in the efficient discharge of the foregoing; and |
· | reporting to the Board from time to time, or whenever it shall be called upon to do so. |
· | monitor the SEC’s adoption of the final rules and definitions; and |
· | adjust Isis’ compensation policies as necessary to satisfy the new rules. |
· | selecting the 2013 Executive Peer Group; |
· | evaluating the pay mix for our executive officers; |
· | evaluating short-term and long-term incentives for our executive officers; and |
· | evaluating non-employee Director compensation. |
•
|
create and constantly advance a new more efficient drug discovery platform, antisense technology;
|
•
|
create a unique business model and culture committed to creating long-term value through innovation;
|
•
|
broaden, deepen and advance our pipeline of antisense drugs;
|
•
|
demand more of every employee - more commitment, more knowledge, more intensity, more innovation;
|
•
|
aggressively manage average and below average performance so that every employee produces more; and
|
•
|
demand great performance and pay for that performance.
|
It takes a significant period of time and a substantial investment to recruit and develop executives who possess the experience and talent necessary to lead at Isis given our innovative technology, innovative business strategy and complex drug development pipeline. Senior executives must have experience with all aspects of our business to be effective leaders. Our drug technology is a “platform technology”, which means the more knowledge and experience an employee has with our technology platform, the better equipped he or she is to create value at Isis. Given the uniqueness and complexity of our technology, it is critical to retain the knowledge and experience of outstanding long service employees. The experience and seniority of our employees is critical to our future success. For these reasons, it is our objective to attract and retain the best talent available, and to invest in those individuals who deliver long-term productivity.
|
|
Given the uniqueness and complexity of our technology, it is critical to retain the knowledge and experience of outstanding long service employees.
|
· | Long tenure among a dedicated and highly skilled workforce, combined with the highest performance standards, contributes to our leadership in the industry and serves the interests of stockholders. |
· | Our focus on retention is coupled to a strong belief that executive talent most often should be developed and promoted from within Isis. |
· | The long tenure of high-performing executive officers reflects this strategy at all levels of the organization. |
o | Our executive officers have tenures at Isis ranging from 13 years to more than 25 years. |
· | Each of the executive officers has been carefully evaluated and selected through a rigorous performance assessment process over a long career. In their current assignments, they remain subject to a challenging annual performance assessment in which they must continue to meet the highest standards or be reassigned or separated from the Company. |
Employees in our organization do not share either accountability or responsibility equally for strategic and/or tactical decisions. It is well ingrained in our culture that not everyone should share the same level of risk/reward for the consequences of these decisions. As a result, we have structured the various components of our compensation system to reflect accountability both for the successes and failures (both long-term and short-term) of Isis and our employees. We pay our senior management team for results and their use of judgment in executing the strategies they have established. Therefore, the more senior a person becomes within Isis, the more the person’s cash compensation will be “at risk.” We compensate the more junior employees for accomplishing their work well and, therefore, a lower portion of their cash compensation is “at risk.”
|
|
The more senior role a person plays, the more that person’s cash compensation will be “at risk.”
|
(1) | base salary, |
(2) | MBO – Performance Based – At Risk Cash Compensation, no portion of which is guaranteed, and |
(3) | stock-based compensation. |
· | Company-wide performance, including achievement of corporate objectives; |
· | the Compensation Committee’s assessment of our CEO’s and executive officers’ individual performance; |
· | competitive compensation practices; |
· | increased efficiencies and process improvements; |
· | effective collaboration and teamwork; |
· | individual expertise, skills and knowledge; |
· | the need to retain and motivate; |
· | the impact an individual’s judgment has on our success or failure; and |
· | the advice of our independent compensation consultant. |
· | are similar to Isis in terms of certain factors, including one or more of the following: size (i.e., revenue, market capitalization), industry, and stage of development; |
· | have named executive officer positions that are comparable to ours in terms of breadth, complexity and scope of responsibilities; and |
· | compete with us for executive talent. |
|
2013 Total Cash Compensation
|
2013 Total Direct Compensation
|
||||||||||||||
Name
|
Named Executive Officer
|
50
th
Percentile of Executive Peer Group
|
Named Executive Officer
|
50
th
Percentile of Executive Peer Group
|
||||||||||||
Stanley T. Crooke
|
|
$1,539,076
|
|
$1,238,100
|
|
$2,758,536
|
|
$3,366,400
|
||||||||
Elizabeth L. Hougen
|
|
$581,367
|
|
$575,900
|
|
$769,865
|
|
$1,373,000
|
||||||||
B. Lynne Parshall
|
|
$1,167,745
|
|
$760,100
|
|
$1,751,326
|
|
$2,084,400
|
||||||||
C. Frank Bennett
|
|
$631,601
|
|
$477,400
|
|
$958,865
|
|
$884,500 | ||||||||
Richard S. Geary
|
|
$624,362
|
|
$380,400 |
|
$942,223
|
|
$655,100
|
Nevertheless, it is as important to develop productivity metrics and compare productivity for biotechnology companies as it is for any other industry. As Isis matures and achieves revenues from the commercial sale of its products, we will use revenue and profit per employee as metrics, supplemented by metrics that measure the value of our drug pipeline and innovation. We analyze our productivity against the Executive Peer Group and other leaders in drug development using, among other measures, number of drugs in clinical development per employee and number of patents per employee. The table below measures Isis on these productivity metrics against the median for the Executive Peer Group, and the leading company in the peer group for each productivity metric (based on the most recent Annual Report of the companies in June 2013, when the Compensation Committee selected the Executive Peer Group):
|
|
Total direct compensation for each of our CEO, CFO and COO was below the 50th percentile range of the Executive Peer Group.
|
|
Drugs in Clinical
Development per Employee
|
Patents per Employee
|
Isis’ Ranking
|
2nd
|
3rd
|
Executive Peer Group Median
|
1 drug for every 61 employees
|
0.02 patents per employee
|
Peer Leader for Drugs in Clinical Development per Employee (Exelixis)
|
1 drug for every 6 employees
|
NA
|
Peer Leader for Patents per Employee (Theravance)
|
NA
|
6 patents per employee
|
Isis Pharmaceuticals, Inc. (ISIS)
|
1 drug for every 12 employees
|
3 patents per employee
|
· | Salaries were frozen for named executive officers from 2011-2013. The Compensation Committee did not increase salaries for the CEO and applicable named executive officers for each of 2011, 2012 and 2013; |
· | More cash compensation is at risk . The Compensation Committee increased the proportion of our CEO’s, COO’s and other named executive officer’s cash compensation that is at risk for 2013 and going forward; and |
· | More of total compensation is long-term equity . The Compensation Committee adjusted the total pay mix for our CEO and other executive officers such that more of their compensation is in the form of long-term equity compensation. |
Name
|
Year
|
Base
Salary
|
Annual
MBO
|
Long-Term Equity
|
Base Salary
%
|
Annual MBO
%
|
Long-Term Equity
%
|
||||||||||||||||||
Stanley T. Crooke
|
2012
|
|
$735,169
|
|
$367,585
|
|
$435,437
|
48
|
%
|
24
|
%
|
28
|
%
|
||||||||||||
CEO & COB
|
2013
|
|
$735,169
|
|
$803,907
|
|
$1,203,708
|
27
|
%
|
29
|
%
|
44
|
%
|
||||||||||||
Elizabeth L. Hougen
|
2012
|
|
$337,036
|
|
$131,444
|
|
$79,203
|
62
|
%
|
24
|
%
|
14
|
%
|
||||||||||||
CFO
|
2013
|
|
$365,496
|
|
$215,871
|
|
$167,880
|
49
|
%
|
29
|
%
|
22
|
%
|
||||||||||||
B. Lynne Parshall
|
2012
|
|
$641,574
|
|
$256,630
|
|
$250,811
|
56
|
%
|
22
|
%
|
22
|
%
|
||||||||||||
COO
|
2013
|
|
$641,574
|
|
$526,171
|
|
$562,945
|
37
|
%
|
30
|
%
|
33
|
%
|
||||||||||||
C. Frank Bennett
|
2012
|
|
$397,077
|
|
$148,904
|
|
$101,591
|
61
|
%
|
23
|
%
|
16
|
%
|
||||||||||||
SVP, Research
|
2013
|
|
$397,077
|
|
$234,524
|
|
$307,226
|
42
|
%
|
25
|
%
|
33
|
%
|
||||||||||||
Richard S. Geary
|
2012
|
|
$398,444
|
|
$143,440
|
|
$113,462
|
61
|
%
|
22
|
%
|
17
|
%
|
||||||||||||
SVP, Development
|
2013
|
|
$398,444
|
|
$225,918
|
|
$303,166
|
43
|
%
|
24
|
%
|
33
|
%
|
We determine base compensation levels for all our employees primarily by market forces. Accordingly, the Compensation Committee believes that it is important when making its compensation decisions to be informed as to the current practices of comparable publicly held companies with which we compete for top talent. To this end, the Compensation Committee reviews market and peer company data, which includes competitive information relating to the mix and levels of compensation for executives in the life sciences industry. We obtain this information for the Executive Peer Group based on recent public filings with the SEC. In addition, we also review data from the Radford Global Life Sciences Survey, which is a summary of compensation data submitted by over 500 life sciences companies. The Committee uses these data to inform and shape its decision-making but does not strictly adhere to quantitative benchmarks. In addition, we assess whether the scope of job responsibilities and internal equity warrant a given base salary.
|
|
Base salaries for CEO and COO were
frozen
for 2011-2013.
|
The executive officers’ new salaries for each year are calculated as follows:
·
Current Base Salary (x) Merit Increase = Increase to Base Salary
·
Current Base Salary (+) Increase to Base Salary = New Base Salary
For example, Dr. Crooke’s 2014 salary of $768,252 was calculated as follows:
|
|
Performance MBOs can be, and have in the past been,
zero
.
Performance MBOs have a maximum limit.
|
2013 Base Salary
|
(x)
|
Merit Increase
|
=
|
Increase to Base Salary
|
$735,169
|
(x)
|
4.5%
|
=
|
$33,083
|
Current Base Salary
|
(+)
|
Increase to Base Salary
|
=
|
New Base Salary in 2014
|
$735,169
|
(+)
|
$33,083
|
=
|
$768,252
|
· | We have a maximum Company Performance Factor of 200% and a maximum Individual Performance Factor of 160%. This range represents the boundary conditions for our Performance Factors and ensures we reward our employees consistent with Isis’ success. |
· | We base Target MBO Percentages on position levels within Isis. The Target MBO percentages for 2013 were: Directors 15%; Executive Directors 20%; Vice Presidents 25% or 30%; Senior Vice Presidents 35%, COO 45%; and CEO 60%. |
· | An individual’s Target MBO percentage does not change unless he or she changes position level or the Compensation Committee sets a new target for that level. |
Name
|
Minimum MBO
Percentage of Salary
|
Maximum MBO
Percentage of Salary
|
Stanley T. Crooke
|
0%
|
192%
|
Elizabeth L. Hougen
|
0%
|
112%
|
B. Lynne Parshall
|
0%
|
144%
|
C. Frank Bennett
|
0%
|
112%
|
Richard S. Geary
|
0%
|
112%
|
· | Isis’ achievement of the approved corporate objectives for the year. At the end of each year, the Compensation Committee meets to evaluate Isis’ overall performance. The Compensation Committee measures Isis’ performance based upon the achievement of goals that were set at the beginning of the year and agreed upon by our Board and upper management (Please see chart below); |
· | In addition, the Compensation Committee considers our one-, three- and five-year total stockholder returns, and based on these returns may reduce the Individual Performance Factors for our executive officers; |
· | The Compensation Committee then reviews the Company Performance Factor history from the prior 10 years to form a comparison for our current year’s successes and/or failures; and |
· | Finally, the Compensation Committee approves each executive officer’s Individual Performance Factor based on the individual’s performance. |
|
Objective & Pre-Approved Measures
|
Evaluation
|
4
|
Make corporate partnerships successful:
|
Isis
exceeded
this objective:
|
|
GlaxoSmithKline
·
Initiate Phase 3 Study ISIS-TTR
Rx
·
Identify at least one new Development Candidate
·
Initiate Phase 1 study for ISIS-GSK3
Rx
|
GlaxoSmithKline
·
Isis initiated the Phase 3 study for ISIS-TTR
Rx
.
·
Isis identified ISIS-GSK4
Rx
earning a $5 million milestone payment.
·
Isis initiated a Phase 1 study for ISIS-GSK3
Rx
earning $10 million in milestone payments.
|
Biogen Idec
·
Initiate infant study for ISIS-SMN
Rx
and meet enrollment
·
Complete enrollment in multi-dose in children with SMA and open-label studies for ISIS-SMN
Rx
·
Achieve breakthrough therapy status for ISIS-SMN
Rx
·
Identify DMPK Development Candidate (achieve milestone)
·
Expand relationship strategically
|
Biogen Idec
·
Isis initiated the Phase 2 open-label, multiple-dose, dose-escalation pilot study of ISIS-SMN
Rx
in infants who have been diagnosed with Type I SMA and exceeded enrollment.
·
Isis completed enrollment for the multi-dose study in children with SMA and open-label studies for ISIS-SMN
Rx
.
·
ISIS-SMN
Rx
did not achieve breakthrough therapy.
·
Isis identified ISIS-DMPK
Rx
and received a $10 million milestone payment in connection with the selection and advancement of ISIS-DMPK
Rx.
·
Isis formed a broad strategic alliance with Biogen Idec to discover and develop antisense drugs to treat neurological disorders, which included a $100 million upfront payment to Isis and the potential for Isis to receive substantial milestone payments, license fees and royalty payments for all treatments developed through the collaboration.
|
|
AstraZeneca
·
Complete enrollment of lymphoma study for ISIS-STAT3
Rx
·
Complete studies required for AstraZeneca to select second development candidate
·
Initiate a second study in patients for STAT3 (AstraZeneca to initiate).
|
AstraZeneca
·
Isis made substantial progress towards enrolling the lymphoma study for ISIS-STAT3
Rx
.
·
AstraZeneca selected ISIS-AR
Rx
as a development candidate and paid Isis a $10 million milestone payment.
·
AstraZeneca initiated a Phase 1b/2a clinical study of ISIS-STAT3
Rx
in patients with advanced metastatic hepatocellular carcinoma.
|
Objective & Pre-Approved Measures
|
Evaluation
|
|
Unplanned Accomplishments
|
||
5
|
Complete successful equity financing
|
Isis successfully completed a public offering of common stock raising $173.3 million in net proceeds.
|
6
|
Demonstrate ISIS-APOCIII
Rx
efficacy in patients with familial chylomicronemia syndrome, or FCS.
|
Isis reported Phase 2 data on ISIS-APOCIII
Rx
demonstrating that ISIS-APOCIII
Rx
reduced triglycerides in patients with FCS. Treatment with ISIS-APOCIII
Rx
resulted in significant reductions of ApoC-III, triglycerides, and ApoC-III-associated very low-density lipoprotein particles.
|
(1) | The numbers correspond to the enumerated objectives in the table entitled “Evaluation of 2013 Corporate Objectives” on pages 54 through 56. The Compensation Committee reviews the individual’s contribution towards the corporate objective when setting the Individual Performance Factor. |
(2) | Since our CEO and COO are ultimately responsible for the Company’s performance, their Individual Performance Factors are usually the same as the Company Performance Factor. |
Some of our largest institutional stockholders agree our stock options are performance-based and the best vehicle for our long-term compensation. Our independent compensation consultant did not recommend we change our equity vehicles
.
Over the past several years we discussed our use of time-vested stock options and RSU awards with our institutional stockholders. The results of this process were that one of our largest institutional stockholders agreed that time-vested options are the best long-term incentive compensation vehicle for a biopharmaceutical company at our stage, and others agreed that our time-vested stock options are performance-based compensation. Our independent compensation consultant also believes time-vested stock options are performance-based compensation and an appropriate equity vehicle for Isis. Also we would be disadvantaged if we did not offer time-vested equity awards since most of the companies we compete with for talent (including most companies in the Executive Peer Group) do not use event-based vesting for equity compensation.
|
|
Our Stock Awards reward performance and incentivize long-term stock appreciation and increased stockholder returns.
|
Executive Officer/Director
|
Stock Ownership Guideline
(as a multiple of base salary/annual cash retainer)
|
CEO
(1)
|
3 times Base Salary
|
COO
|
2 times Base Salary
|
All other executive officers
|
1 times Base Salary
|
Non-employee Directors
|
3 times Annual Cash Retainer
|
(1) | Dr. Crooke currently meets these ownership guidelines. |
· | any bonus or other incentive-based or equity-based compensation received by that person from Isis during the 12-month period following the first public issuance or filing with the SEC (whichever first occurs) of the financial document embodying such financial reporting requirement; and |
· | any profits realized from such executive’s sale of Isis’ securities during that 12-month period. |
Name and Principal
Position
|
Year
|
Salary
($)
|
Bonus
(1)
($)
|
Stock Awards
(2)(3)
($)
|
Option Awards
(3)
($)
|
All Other Compensation
(4)
($)
|
Total
($)
|
||||||||||||||||||
Stanley T. Crooke
Chairman, President, Chief Executive Officer
|
2013
|
|
$735,169
|
|
$803,907
|
|
$325,971
|
|
$877,737
|
|
$15,752
|
|
$2,758,536
|
||||||||||||
2012
|
|
$735,169
|
|
$367,585
|
|
$90,516
|
|
$344,921
|
|
$17,815
|
|
$1,556,006
|
|||||||||||||
2011
|
|
$735,169
|
|
$535,938
|
--
|
|
$611,305
|
|
$14,920
|
|
$1,897,332
|
||||||||||||||
Elizabeth L. Hougen
(5)
Senior Vice President, Finance and Chief Financial Officer
|
2013
2012
|
|
$365,496
$337,036
|
|
$215,871
$131,444
|
|
(6)
$54,419
$16,462
|
|
(6)
$113,461
$62,741
|
|
$20,618
$21,148
|
|
$769,865
$568,831
|
||||||||||||
B. Lynne Parshall
Director, Chief Operating Officer
|
2013
|
|
$641,574
|
|
$526,171
|
|
$152,482
|
|
$410,463
|
|
$20,636
|
|
$1,751,326
|
||||||||||||
2012
|
|
$641,574
|
|
$256,630
|
|
$52,136
|
|
$198,675
|
|
$22,600
|
|
$1,171,615
|
|||||||||||||
2011
|
|
$641,574
|
|
$409,244
|
--
|
|
$364,913
|
|
$19,088
|
|
$1,434,819
|
||||||||||||||
C. Frank Bennett
Senior Vice President, Antisense Research
|
2013
|
|
$397,077
|
|
$234,524
|
|
$83,145
|
|
$224,081
|
|
$20,038
|
|
$958,865
|
||||||||||||
2012
|
|
$397,077
|
|
$148,904
|
|
$21,113
|
|
$80,478
|
|
$21,074
|
|
$668,646
|
|||||||||||||
2011
|
|
$397,077
|
|
$201,020
|
--
|
|
$136,434
|
|
$17,398
|
|
$751,929
|
||||||||||||||
Richard S. Geary
Senior Vice President, Development
|
2013
|
|
$398,444
|
|
$225,918
|
|
$82,117
|
|
$221,049
|
|
$14,695
|
|
$942,223
|
||||||||||||
2012
|
|
$398,444
|
|
$143,440
|
|
$23,583
|
|
$89,879
|
|
$17,048
|
|
$672,394
|
|||||||||||||
2011
|
|
$398,444
|
|
$225,918
|
--
|
|
$167,446
|
|
$14,125
|
|
$805,933
|
(1) | We present bonuses in the years they were earned, not in the year paid. Bonuses represent compensation for achievements and are not necessarily paid in the year they are earned; for example, in January 2014 we paid bonuses for 2013 performance. |
(2) | The Company began granting restricted stock units in January 2012. |
(3) | Amounts represent the aggregate expense recognized for financial statement reporting purposes in accordance with FASB Topic ASC 718 (“ASC 718”) for stock and option awards granted to our named executive officers. ASC 718 expense for the option awards is based on the fair value of the awards on the date of grant using an option-pricing model. The fair value of RSUs is based on the market price of our common stock on the date of grant. For more information, please see Note 5 of the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013 regarding assumptions underlying valuation of equity awards. |
(4)
|
Includes AD&D, Basic Life, Medical, Dental, Vision, and 401(k) matching contributions which are available to all employees.
|
(5) | Ms. Hougen was not a named executive officer in 2011 or 2012 and did not become an executive officer until January 2013. We are not disclosing compensation for 2011 as permitted by SEC regulations. |
(6) | Ms. Hougen received additional stock options and stock awards due to her promotion to Chief Financial Officer in January 2013. |
Name
|
Grant Date
|
All Other Stock Awards: Number of Shares of Stock or Units
(#)
|
All Other Option Awards: Number of Securities Underlying Options
(#)
|
Exercise or Base Price of Option Awards
($/Sh)
|
Grant Date Fair Value of Stock and Option Awards
(1)
($)
|
||||||||||||
Stanley T. Crooke
|
1/30/13
|
|
133,180
|
|
$14.69
|
|
$877,737
|
||||||||||
1/30/13
|
22,190
|
|
$325,971
|
||||||||||||||
Elizabeth L. Hougen
|
(2)
1/2/13
|
7,500
|
|
$10.82
|
|
$36,679
|
|||||||||||
1/2/13
|
15,700
|
|
$10.82
|
|
$76,782
|
||||||||||||
(2)
1/2/13
|
1,250
|
|
$17,600
|
||||||||||||||
1/2/13
|
2,615
|
|
$36,819
|
||||||||||||||
B. Lynne Parshall
|
1/30/13
|
62,280
|
|
$14.69
|
|
$410,463
|
|||||||||||
1/30/13
|
10,380
|
|
$152,482
|
||||||||||||||
C. Frank Bennett
|
1/30/13
|
34,000
|
|
$14.69
|
|
$224,081
|
|||||||||||
1/30/13
|
5,660
|
|
$83,145
|
||||||||||||||
Richard S. Geary
|
1/30/13
|
33,540
|
|
$14.69
|
|
$221,049
|
|||||||||||
1/30/13
|
5,590
|
|
$82,117
|
(1) | Amounts represent the aggregate expense recognized for financial statement reporting purposes in accordance with FASB Topic ASC 718 (“ASC 718”) for stock and option awards granted to our named executive Officers. ASC 718 expense for the option awards is based on the fair value of the awards on the date of grant using an option-pricing model. The fair value of RSUs is based on the market price of our common stock on the date of grant. For more information, please see Note 5 of the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013 regarding assumptions underlying valuation of equity awards. |
(2) | Granted as a result of Ms. Hougen’s promotion to Chief Financial Officer in January 2013. |
|
|
Option Awards
|
Stock Awards
|
||||||||||||||||||||||
Name
|
Grant
Date
|
Number of Securities Underlying Unexercised Options
(#)
Exercisable
(1)
|
Number of Securities Underlying Unexercised Options
(#)
Unexercisable
|
Option Exercise Price
($)
|
Option Expiration Date
|
Number of Shares or Units of Stock that Have Not Vested
(2)
|
Market Value of Shares or Units of Stock that Have Not Vested
(3)
($)
|
||||||||||||||||||
Stanley T. Crooke |
01/02/2009
|
150,000
|
0
|
|
$14.47
|
1/1/16
|
--
|
--
|
|||||||||||||||||
01/04/2010
|
116,680
|
2,483
|
|
$11.27
|
1/3/17
|
--
|
--
|
||||||||||||||||||
01/03/2011
|
89,028
|
33,068
|
|
$10.29
|
1/2/18
|
--
|
--
|
||||||||||||||||||
01/03/2012
|
51,368
|
55,835
|
|
$7.25
|
1/2/19
|
--
|
--
|
||||||||||||||||||
01/30/2013
|
0
|
133,180
|
|
$14.69
|
1/29/20
|
--
|
--
|
||||||||||||||||||
01/15/2012
|
--
|
--
|
--
|
--
|
8,932
|
|
$355,851
|
||||||||||||||||||
01/30/2013
|
--
|
--
|
--
|
--
|
22,190
|
|
$884,050
|
||||||||||||||||||
Elizabeth L. Hougen |
01/02/2009
|
12,657
|
0
|
|
$14.47
|
1/1/16
|
--
|
--
|
|||||||||||||||||
01/04/2010
|
19,583
|
417
|
|
$11.27
|
1/3/17
|
--
|
--
|
||||||||||||||||||
01/03/2011
|
16,041
|
5,959
|
|
$10.29
|
1/2/18
|
--
|
--
|
||||||||||||||||||
01/03/2012
|
9,343
|
10,157
|
|
$7.25
|
1/2/19
|
--
|
--
|
||||||||||||||||||
01/02/2013
|
0
|
15,700
|
|
$10.82
|
1/1/20
|
--
|
--
|
||||||||||||||||||
01/02/2013
|
0
|
7,500
|
|
$10.82
|
1/1/20
|
--
|
--
|
||||||||||||||||||
01/15/2012
|
--
|
--
|
--
|
--
|
1,624
|
|
$64,700
|
||||||||||||||||||
01/15/2013
|
--
|
--
|
--
|
--
|
1,250
|
|
$49,800
|
||||||||||||||||||
01/15/2013
|
--
|
--
|
--
|
--
|
2,615
|
|
$104,182
|
||||||||||||||||||
B. Lynne Parshall
|
01/04/2010
|
2,648
|
1,324
|
|
$11.27
|
1/3/17
|
--
|
--
|
|||||||||||||||||
01/03/2011
|
53,144
|
19,740
|
|
$10.29
|
1/2/18
|
--
|
--
|
||||||||||||||||||
01/03/2012
|
29,588
|
32,161
|
|
$7.25
|
1/2/19
|
--
|
--
|
||||||||||||||||||
01/30/2013
|
0
|
62,280
|
|
$14.69
|
1/29/20
|
--
|
--
|
||||||||||||||||||
01/15/2012
|
--
|
--
|
--
|
--
|
5,145
|
|
$204,977
|
||||||||||||||||||
01/30/2013
|
--
|
--
|
--
|
--
|
10,380
|
|
$413,539
|
||||||||||||||||||
C. Frank Bennett
|
01/02/2008
|
16,200
|
0
|
|
$15.38
|
1/1/15
|
--
|
--
|
|||||||||||||||||
01/02/2009
|
32,909
|
0
|
|
$14.47
|
1/1/16
|
--
|
--
|
||||||||||||||||||
01/04/2010
|
27,225
|
580
|
|
$11.27
|
1/3/17
|
--
|
--
|
||||||||||||||||||
01/03/2011
|
19,870
|
7,380
|
|
$10.29
|
1/2/18
|
--
|
--
|
||||||||||||||||||
01/03/2012
|
11,985
|
13,028
|
|
$7.25
|
1/2/19
|
--
|
--
|
||||||||||||||||||
01/30/2013
|
0
|
34,000
|
|
$14.69
|
1/29/20
|
--
|
--
|
||||||||||||||||||
01/15/2012
|
--
|
--
|
--
|
--
|
2,083
|
|
$82,987
|
||||||||||||||||||
01/30/2013
|
--
|
--
|
--
|
--
|
5,660
|
|
$225,494
|
||||||||||||||||||
Richard S. Geary
|
01/04/2010
|
6,800
|
680
|
|
$11.27
|
1/3/17
|
--
|
--
|
|||||||||||||||||
01/03/2011
|
6,968
|
9,058
|
|
$10.29
|
1/2/18
|
--
|
--
|
||||||||||||||||||
01/03/2012
|
13,386
|
14,549
|
|
$7.25
|
1/2/19
|
--
|
--
|
||||||||||||||||||
01/30/2013
|
0
|
33,540
|
|
$14.69
|
1/29/20
|
--
|
--
|
||||||||||||||||||
01/15/2012
|
--
|
--
|
--
|
--
|
2,327
|
|
$92,708
|
||||||||||||||||||
01/30/2013
|
--
|
--
|
--
|
--
|
5,590
|
|
$222,706
|
(1) | The options have a term of seven years and vest at the rate of 25% for the first year and then at the rate of 2.08% per month for 36 months thereafter during the optionee’s employment. |
(2) | The RSUs were granted out of our 2011 Equity Incentive Plan . The RSUs vest at the rate of 25% per year over four years. |
(3) | Market value of stock awards was determined by multiplying the number of unvested shares by $39.84, which was the closing market price of our common stock on NASDAQ on December 31, 2013, the last trading day of fiscal 2013. |
|
Option Awards
|
Stock Awards
|
||||||||||||||
Name
|
Number of
Shares
Acquired
on Exercise
(#)
(1)
|
Value Realized
on Exercise ($)
|
Number of
Shares
Acquired
on Vesting (#)
|
Value Realized
on Vesting ($)
|
||||||||||||
Stanley T. Crooke |
10,000
|
|
$189,020
|
|
|
|||||||||||
1,885
|
|
$37,512
|
|
|
||||||||||||
24,180
|
|
$353,874
|
|
|
||||||||||||
10,000
|
|
$151,450
|
|
|
||||||||||||
30,000
|
|
$439,890
|
|
|
||||||||||||
5,008
|
|
$73,347
|
|
|
||||||||||||
11,500
|
|
$217,120
|
|
|
||||||||||||
10,000
|
|
$190,800
|
|
|
||||||||||||
26,615
|
|
$513,536
|
||||||||||||||
8,740
|
|
$216,560
|
||||||||||||||
10,000
|
|
$214,900
|
||||||||||||||
10,000
|
|
$154,920
|
||||||||||||||
8,115
|
|
$126,919
|
||||||||||||||
10,000
|
|
$202,600
|
||||||||||||||
10,000
|
|
$224,450
|
||||||||||||||
10,435
|
|
$224,457
|
||||||||||||||
20,000
|
|
$274,600
|
|
|||||||||||||
12,000
|
|
$268,570
|
2,978
|
$41,930
|
||||||||||||
10,000
|
|
$205,900
|
||||||||||||||
30,000
|
|
$498,690
|
||||||||||||||
6,000
|
|
$133,122
|
||||||||||||||
12,000
|
|
$263,568
|
||||||||||||||
20,000
|
|
$480,080
|
||||||||||||||
19,565
|
|
$411,941
|
||||||||||||||
30,000
|
|
$440,040
|
||||||||||||||
24,992
|
|
$367,632
|
||||||||||||||
10,000
|
|
$148,050
|
||||||||||||||
10,000
|
|
$148,050
|
||||||||||||||
20,000
|
|
$405,820
|
||||||||||||||
2,200
|
|
$35,244
|
||||||||||||||
30,000
|
|
$717,000
|
||||||||||||||
10,000
|
|
$229,280
|
||||||||||||||
10,000
|
|
$226,850
|
||||||||||||||
30,000
|
|
$382,380
|
||||||||||||||
6,000 |
|
$104,700
|
|
Option Awards
|
Stock Awards
|
||||||||||||||
Name
|
Number of
Shares
Acquired
on Exercise
(#)
(1)
|
Value Realized
on Exercise ($)
|
Number of
Shares
Acquired
on Vesting (#)
|
Value Realized
on Vesting ($)
|
||||||||||||
Elizabeth L. Hougen
|
9,843
|
|
$69,098
|
|
|
|||||||||||
2,813
|
|
$16,934
|
|
|
||||||||||||
4,792
|
|
$33,592
|
|
|
||||||||||||
9,584
|
|
$67,184
|
|
|
||||||||||||
3,000
|
|
$18,090
|
542
|
|
$7,631
|
|||||||||||
10,417
|
|
$72,919
|
||||||||||||||
5,040
|
|
$50,637
|
||||||||||||||
2,000
|
|
$12,100
|
||||||||||||||
B. Lynne Parshall
(2)
|
30,000
|
|
$330,000
|
|||||||||||||
20,000
|
|
$394,880
|
||||||||||||||
38,400
|
|
$594,337
|
||||||||||||||
20,000
|
|
$594,520
|
||||||||||||||
10,000
|
|
$205,180
|
||||||||||||||
1,520
|
|
$24,018
|
||||||||||||||
48,229
|
|
$1,312,359
|
||||||||||||||
30,000
|
|
$296,100
|
||||||||||||||
3,333
|
|
$36,796
|
||||||||||||||
3,333
|
|
$36,680
|
1,715
|
|
$24,147
|
|||||||||||
7,454
|
|
$84,789
|
||||||||||||||
30,000
|
|
$451,050
|
||||||||||||||
30,000
|
|
$642,840
|
||||||||||||||
3,334
|
|
$36,291
|
||||||||||||||
1,771
|
|
$53,858
|
||||||||||||||
30,000
|
|
$382,380
|
||||||||||||||
37,811
|
|
$1,120,642
|
||||||||||||||
30,000
|
|
$557,100
|
||||||||||||||
30,000
|
|
$488,040
|
||||||||||||||
C. Frank Bennett (3) |
23,800
|
|
$367,734
|
|||||||||||||
4,550
|
|
$111,566
|
||||||||||||||
6,145
|
|
$68,461
|
||||||||||||||
1,810
|
|
$44,417
|
||||||||||||||
3,640
|
|
$89,398
|
695
|
|
$9,786
|
|||||||||||
30,000
|
|
$341,553
|
||||||||||||||
10,000
|
|
$196,400
|
||||||||||||||
10,000
|
|
$148,450
|
Option Awards
|
Stock Awards
|
|||||||||||||||
Name
|
Number of
Shares
Acquired
on Exercise
(#)
(1)
|
Value Realized
on Exercise ($)
|
Number of
Shares
Acquired
on Vesting (#)
|
Value Realized
on Vesting ($)
|
||||||||||||
Richard S. Geary |
2,042
|
|
$19,767
|
|||||||||||||
10,358
|
|
$204,602
|
||||||||||||||
10,435
|
|
$139,777
|
||||||||||||||
5,000
|
|
$49,700
|
||||||||||||||
1,000
|
|
$8,380
|
||||||||||||||
5,007
|
|
$93,911
|
||||||||||||||
16,960
|
|
$263,643
|
||||||||||||||
1,049
|
|
$21,767
|
||||||||||||||
2,220
|
|
$41,614
|
||||||||||||||
7,060
|
|
$139,788
|
776
|
|
$10,926
|
|||||||||||
1,565
|
|
$21,675
|
||||||||||||||
13,730
|
|
$135,103
|
||||||||||||||
17,933
|
|
$337,499
|
||||||||||||||
7,000
|
|
$58,800
|
||||||||||||||
6,270
|
|
$61,321
|
||||||||||||||
5,000
|
|
$54,675
|
||||||||||||||
9,000
|
|
$187,020
|
||||||||||||||
10,000
|
|
$94,100
|
||||||||||||||
4,000 |
|
$51,760
|
(1) | Each individual executed each option exercise and resulting sales pursuant to the individual’s Rule 10b5-1 trading plan. |
(2) | Includes options exercised by Ms. Parshall’s daughters. |
(3) | Dr. Bennett had 10,322 stock options expire unexercised last year due to being blocked from trading under Isis’ insider trading policy. |
· | Dr. Crooke will be eligible to receive a lump sum severance payment equal to 36 months of his then-current base salary in the event his employment is terminated as a result of a change of control of Isis; and |
· | Ms. Parshall will be eligible to receive a lump sum severance payment equal to: |
- | 18 months of her then-current base salary in the event that her employment is terminated without cause; and |
- | 30 months of her then-current base salary in the event that her employment is terminated as a result of a change of control of Isis. |
|
Termination Event
|
|||||||
Name
|
Termination Without Cause
|
Termination in a Change of Control
|
||||||
Stanley T. Crooke
|
--
|
|
$2,205,507
|
|||||
B. Lynne Parshall
|
|
$962,361
|
|
$1,603,935
|
Role
|
2013 Cash Compensation
|
2014 Cash Compensation
|
||||||
Board Member (Base)
|
|
$45,000
|
|
$50,000
|
||||
Committee Chairs (Additional)
|
||||||||
Audit
|
|
$0
|
|
$24,000
|
||||
Compensation
|
|
$0
|
|
$15,000
|
||||
Nominating & Gov.
|
|
$0
|
|
$10,000
|
||||
Agenda
|
|
$0
|
|
$10,000
|
||||
Committee Member (Additional)
|
||||||||
Audit
|
|
$0
|
|
$10,000
|
||||
Compensation
|
|
$0
|
|
$7,500
|
||||
Nominating & Gov.
|
|
$0
|
|
$5,000
|
||||
Agenda
|
|
$0
|
|
$5,000
|
||||
Scientific/Medical
|
|
$0
|
|
$10,000
|
Name
|
Fees
Earned or Paid in Cash
($)
|
Stock
Awards
($)
|
Option
Awards
($)
(2)
|
All Other
Compensation
($)
|
Total
($)
|
|||||||||||||||
Spencer R. Berthelsen
|
|
$45,000
|
|
$53,381
|
|
$177,179
|
--
|
|
$275,560
|
|||||||||||
Breaux B. Castleman
(3)
|
|
$22,500
|
|
$153,356
|
|
$513,207
|
--
|
|
$689,063
|
|||||||||||
Joseph Klein
|
|
$45,000
|
|
$53,381
|
|
$177,179
|
--
|
|
$275,560
|
|||||||||||
Frederick T. Muto
|
|
$45,000
|
|
$53,381
|
|
$177,179
|
--
|
|
$275,560
|
|||||||||||
Joseph H. Wender
|
|
$45,000
|
|
$53,381
|
|
$177,179
|
--
|
|
$275,560
|
(1) | Dr. Loscalzo joined our Board in 2014 and did not receive compensation from us during fiscal 2013. |
(2) | Amounts represent the aggregate expense recognized for financial statement reporting purposes in accordance with FASB Topic ASC 718 (“ASC 718”) for stock and option awards granted to the Directors. ASC 718 expense for the option awards is based on the fair value of the awards on the date of grant using an option-pricing model. The fair value of RSUs is based on the market price of our common stock on the date of grant. For more information, please see Note 5 of the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013 regarding assumptions underlying valuation of equity awards. |
(3) | Mr. Castleman became a Director on June 25, 2013. The stock awards and option awards reported above include an additional RSU for 3,750 shares and an option to purchase 22,500 shares of our common stock Mr. Castleman received when he joined our Board. |
|
Option Awards
|
Stock Awards
|
|||||||||||||||||||||
Name
|
Number of Securities Underlying Unexercised Options (#)
Exercisable
(1)
|
Number of Securities Underlying Unexercised Options (#)
Unexercisable
|
Option Exercise Price
($)
|
Option
Expiration
Date
|
Number of Shares or Units of Stock that Have Not Vested
(2) (3)
|
Market Value of Shares or Units of Stock that Have Not Vested
(4)
($)
|
|||||||||||||||||
Spencer R. Berthelsen
|
10,000
|
0
|
|
$5.72
|
6/30/14
|
|
|
||||||||||||||||
10,000
|
0
|
|
$3.95
|
6/30/15
|
|
|
|||||||||||||||||
12,500
|
0
|
|
$5.93
|
7/2/16
|
|
|
|||||||||||||||||
12,500
|
0
|
|
$9.77
|
7/1/17
|
|
|
|||||||||||||||||
15,000
|
0
|
|
$13.88
|
6/30/18
|
|
|
|||||||||||||||||
15,000
|
0
|
|
$16.32
|
6/30/19
|
2,812
|
|
$112,030
|
||||||||||||||||
11,250
|
3,750
|
|
$9.22
|
6/30/20
|
|||||||||||||||||||
7,500
|
7,500
|
|
$9.30
|
6/30/21
|
|||||||||||||||||||
2,813
|
8,437
|
|
$12.94
|
7/1/22
|
|||||||||||||||||||
0
|
11,250
|
|
$28.47
|
6/30/23
|
|||||||||||||||||||
Breaux B. Castleman
|
0
|
22,500
|
|
$26.66
|
6/24/23
|
5,625
|
|
$224,100
|
|||||||||||||||
0
|
11,250
|
|
$28.47
|
6/30/23
|
|||||||||||||||||||
Joseph Klein
|
7,500
|
0
|
|
$16.32
|
6/30/19
|
||||||||||||||||||
0
|
3,750
|
|
$9.22
|
6/30/20
|
|||||||||||||||||||
0
|
7,500
|
|
$9.30
|
6/30/21
|
2,812
|
|
$112,030
|
||||||||||||||||
2,813
|
8,437
|
|
$12.94
|
7/1/22
|
|||||||||||||||||||
0
|
11,250
|
|
$28.47
|
6/30/23
|
|||||||||||||||||||
Frederick T. Muto
|
10,000
|
0
|
|
$5.72
|
6/30/14
|
||||||||||||||||||
10,000
|
0
|
|
$3.95
|
6/30/15
|
|||||||||||||||||||
12,500
|
0
|
|
$5.93
|
7/2/16
|
|||||||||||||||||||
12,500
|
0
|
|
$9.77
|
7/1/17
|
|||||||||||||||||||
15,000
|
0
|
|
$13.88
|
6/30/18
|
2,812
|
|
$112,030
|
||||||||||||||||
15,000
|
0
|
|
$16.32
|
6/30/19
|
|||||||||||||||||||
11,250
|
3,750
|
|
$9.22
|
6/30/20
|
|||||||||||||||||||
7,500
|
7,500
|
|
$9.30
|
6/30/21
|
|||||||||||||||||||
2,813
|
8,437
|
|
$12.94
|
7/1/22
|
|||||||||||||||||||
0
|
11,250
|
|
$28.47
|
6/30/23
|
|||||||||||||||||||
Joseph H. Wender
|
10,000
|
0
|
|
$5.72
|
6/30/14
|
||||||||||||||||||
10,000
|
0
|
|
$3.95
|
6/30/15
|
|||||||||||||||||||
12,500
|
0
|
|
$5.93
|
7/2/16
|
|||||||||||||||||||
12,500
|
0
|
|
$9.77
|
7/1/17
|
|||||||||||||||||||
15,000
|
0
|
|
$13.88
|
6/30/18
|
2,812
|
|
$112,030
|
||||||||||||||||
11,250
|
3,750
|
|
$9.22
|
6/30/20
|
|||||||||||||||||||
7,500
|
7,500
|
|
$9.30
|
6/30/21
|
|||||||||||||||||||
2,813
|
8,437
|
|
$12.94
|
7/1/22
|
|||||||||||||||||||
0
|
11,250
|
|
$28.47
|
6/30/23
|
(1) | The options were granted out of our Directors’ Plan and have a term of ten years and vest at the rate of 25% per year over four years. |
(2) | The RSUs were granted out of our Directors’ Plan and vest at the rate of 25% per year over four years. |
(3) | All of our non-employee Directors are subject to our Stock Holding and Ownership Guidelines for RSU Shares, which requires each non-employee Director to accumulate and maintain shares of Common Stock issued pursuant to RSUs until he has accumulated shares of Common Stock equal to three times such non-employee Director’s annual cash retainer, or until his termination of service. |
(4) | Market value of stock awards was determined by multiplying the number of unvested shares by $39.84, which was the closing market price of our common stock on NASDAQ on December 31, 2013, the last trading day of fiscal 2013. |
|
Option Awards
|
Stock Awards
|
||||||||||||||
Name
|
Number of
Shares
Acquired
on Exercise
(#)
|
Value Realized
on Exercise
($)
|
Number of
Shares
Acquired
on Vesting
(#)
|
Value Realized
on Vesting
($)
|
||||||||||||
Spencer R. Berthelsen
(1)
|
10,000
|
|
$89,600
|
313
|
|
$8,911
|
||||||||||
Breaux B. Castleman
|
--
|
--
|
--
|
--
|
||||||||||||
Joseph Klein, III
|
(2)
86,250
|
|
$940,545
|
313
|
|
$8,911
|
||||||||||
Frederick T. Muto
|
10,000
|
|
$167,900
|
313
|
|
$8,911
|
||||||||||
Joseph H. Wender
|
(3)
25,000
|
|
$497,926
|
313
|
|
$8,911
|
(1) | Dr. Berthelsen exercised options that would have expired on June 30, 2013 and held his shares. |
(2) | Mr. Klein’s children exercised 67,500 shares. |
(3) | Mr. Wender exercised options that would have expired on June 30, 2013 and held 9,822 shares. |
Name and Principal
Position
|
Year
|
Salary
($)
|
Bonus
(1)
($)
|
Stock Awards
(2)(3)
($)
|
Option Awards
(3)(5)
($)
|
All Other Compensation
(4)
($)
|
Total
($)
|
||||||||||||||||||
Rosanne Crooke
Vice President, Cardiovascular Diseases Drug Discovery Research
|
2013
|
|
$203,685
|
|
$89,367
|
|
$23,457
|
|
$48,906
|
|
$3,777
|
|
$369,192
|
||||||||||||
2012
|
|
$197,369
|
|
$59,211
|
|
$9,622
|
|
$36,692
|
|
$4,517
|
|
$307,411
|
|||||||||||||
2011
|
|
$189,778
|
|
$80,063
|
--
|
|
$75,102
|
|
$3,710
|
|
$348,653
|
(1) | We present bonuses in the years they were earned, not in the year paid. Bonuses represent compensation for achievements and are not necessarily paid in the year they are earned; for example, in January 2014 we paid bonuses for 2013 performance. |
(2) | The Company began granting restricted stock unit awards in January of 2012. |
(3) | Amounts represent the aggregate expense recognized for financial statement reporting purposes in accordance with FASB Topic ASC 718 (“ASC 718”) for stock and option awards granted to Dr. Crooke. ASC 718 expense for the option awards is based on the fair value of the awards on the date of grant using an option-pricing model. The fair value of RSUs is based on the market price of our common stock on the date of grant. For more information, please see Note 5 of the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2013 regarding assumptions underlying valuation of equity awards. |
(4) | Includes AD&D, Basic Life, Medical, Dental, Vision, and 401(k) matching contributions which are available to all employees. |
(5) | These amounts represent the estimated fair values of stock option grants we recognized as share-based compensation expense. The estimated fair value amounts were determined using the Black-Scholes option-valuation model and are not indicative of whether Dr. Rosanne Crooke will realize the estimated fair value or any financial benefits from the award. The applicable amounts represent: |
· | 15,000 shares at $10.29 per share received on January 3, 2011; |
· | 11,404 shares at $7.25 per share received on January 3, 2012; and |
· | 10,000 shares at $10.82 per share received on January 2, 2013. |
· | reviewed and discussed the Compensation Discussion and Analysis included in this Proxy Statement with management; and |
· | based on this review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in our Proxy Statement relating to the 2014 Annual Meeting of Stockholders. |
* | This Section is not “soliciting material,” is not deemed filed with the SEC and is not to be incorporated by reference in any filing of Isis under the Securities Act or the Exchange Act. |
|
By Order of the Board of Directors,
|
|
|
|
B. Lynne Parshall
|
|
Secretary
|
By:
|
|||
B. Lynne Parshall
|
|||
|
Chief Operating Officer
|
1.
|
Purposes.
|
2.
|
Definitions.
|
3.
|
Administration
.
|
4.
|
Shares Subject to the Plan.
|
5.
|
Eligibility.
|
6.
|
Non-Discretionary Grants.
|
7.
|
Option Provisions.
|
8.
|
Restricted Stock Unit Provisions.
|
9.
|
Covenants of the Company.
|
10.
|
Use of Proceeds from Stock.
|
11.
|
Miscellaneous.
|
12.
|
Adjustments upon Changes in Stock.
|
13.
|
Amendment of the Plan and Stock Awards.
|
14.
|
Termination or Suspension of the Plan.
|
15.
|
Effective Date of Plan.
|
16.
|
Choice of Law.
|
ISIS PHARMACEUTICALS, INC.
2855 GAZELLE COURT
CARLSBAD, CA 92010
ATTN: LINDA L. POWELL
|
VOTE BY INTERNET -
www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
ELECTRONIC DELIVERY Of fUTURE PROXY MATERIALS
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you call and then follow the instructions.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
|
|
M75287-P46451
|
KEEP THIS PORTION FOR YOUR RECORDS
|
|
|
DETACH AND RETURN THIS PORTION ONLY
|
|
|
ISIS PHARMACEUTICALS, INC.
Annual Meeting of Stockholders on June 10, 2014 at 2:00 PM
This proxy is solicited by the Board of Directors of Isis Pharmaceuticals, Inc.
The undersigned hereby appoints B. Lynne Parshall and Stanley T. Crooke, and each of them, with power to act without the other and with power of substitution, as proxies and attorneys-in-fact and hereby authorizes them to represent and vote, as provided on the other side, all the shares of Isis Pharmaceuticals, Inc. Common Stock which the undersigned is entitled to vote and, in their discretion, to vote upon such other business as may properly come before the Annual Meeting of Stockholders o the Company to be held June 10, 2014 or any adjournment thereof with all powers which the undersigned would possess if present at the Meeting.
This proxy, when properly executed, will be voted in the manner directed herein by the undersigned. If no direction is made but the card is signed, this proxy will be voted for the election of the nominees under Proposal 1, FOR Proposals 2, 3, 4, 5, 6 and 7 and in the discretion of the proxies with respect to such other business as may properly come before the meeting.
Continued and to be signed on reverse side
|
|