UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment

(Amendment No.   )

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Check the appropriate box:

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[X] Definitive Proxy Statement

[   ] Definitive Additional Materials

[   ] Soliciting Material Pursuant to Section 240.14a-12

IGI Laboratories, Inc.

(Name of Registrant as Specified inIn Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

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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.

Where Can I Find the Voting Results of the Annual Meeting?

The preliminary voting results will be announced at the annual meeting, and we will publish preliminary, or final results, if available, in a Current Report on Form 8-K within four business days of the annual meeting. If final results are unavailable at the time we file the Form 8-K, then we will file an amended report on Form 8-K to disclose the final voting results within four business days after the final voting results are known.

What Are the Costs of Soliciting these Proxies?

We will pay all of the costs of soliciting these proxies. OurWe have engaged Morrow & Co., LLC, 470 West Ave., Stamford, Connecticut 06902, to assist us with the solicitation of proxies for a fee of $5,500, plus expenses.  In addition, our directors and employees may solicit proxies in person or by telephone, fax or email. We will pay these employees and directors no additional compensation for these services. We will ask banks, brokers and other institutions, nominees and fiduciaries to forward these proxy materials to their principals and to obtain authority to execute proxies. We will then reimburse them for their expenses.

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What Constitutes a Quorum for the Annual Meeting?

The presence, in person or by proxy, of the holders of a majority of the voting power of all outstanding shares of our common stock entitled to vote at the annual meeting is necessary to constitute a quorum at the annual meeting. Votes of stockholders of record who are present at the annual meeting in person or by proxy, abstentions, and broker non-votes are counted for purposes of determining whether a quorum exists.

Attending the Annual Meeting

The annual meeting will be held at 10:00 a.m.on May 20, 2015, at the offices ofMintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. When you arrive at Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., signs will direct you to the appropriate meeting rooms. You need not attend the annual meeting in order to vote.

Householding of Annual Disclosure Documents

The rules of the Securities and Exchange Commission (the “SEC rules”) concerning the delivery of annual disclosure documents allow us or your broker to send a single Notice or, if applicable, a single set of our proxy materials to any household at which two or more of our stockholders reside, if we or your broker believe that the stockholders are members of the same family. This practice, referred to as “householding,” benefits both you and us. It reduces the volume of duplicate information received at your household and helps to reduce our expenses. The rule applies to our Notices, annual reports, proxy statements and information statements. Once you receive notice from your broker or from us that communications to your address will be “householded,” the practice will continue until you are otherwise notified or until you revoke your consent to the practice. Stockholders who participate in householding will continue to have access to and utilize separate proxy voting instructions.

If your household received a single Notice or, if applicable, a single set of proxy materials this year, but you would prefer to receive your own copy, please contact Broadridge Financial Solutions, Inc., by calling their toll free number, 1-888-237-1900.

If you do not wish to participate in “householding” and would like to receive your own Notice or, if applicable, set of ourIGI’s proxy materials in future years, follow the instructions described below. Conversely, if you share an address with another IGI stockholderIGIstockholder and together both of you would like to receive only a single Notice or, if applicable, set of proxy materials, follow these instructions:

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If your IGI shares are registered in your own name, please contact Broadridge Financial Solutions, Inc., and inform them of your request by calling them at 1-888-237-1900 or writing them at 51 Mercedes Way, Edgewood, New York 11717.

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If a broker or other nominee holds your IGI shares, please contact the broker or other nominee directly and inform them of your request. Be sure to include your name, the name of your brokerage firm and your account number.

Electronic Delivery of Company Stockholder Communications

Most stockholders can elect to view or receive copies of future proxy materials over the Internet instead of receiving paper copies in the mail.

You can choose this option and save the Company the cost of producing and mailing these documents by:

·SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information with respect to the instructions provided on your Notice or proxy card;

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following the instructions provided when you submit a proxy to vote over the Internet; or

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going towww.proxyvote.com and following the instructions provided.

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PROPOSAL NO. 1 - ELECTION OF DIRECTORS

At the Annual Meeting, holdersbeneficial ownership of our common stock will voteas of April 24, 2015 for (a) the executive officers named in the Summary Compensation Table on page 28 of this proxy statement, (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 elect five membersown beneficially more than 5% of our common stock. Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the securities. We deem shares of common stock that may be acquired by an individual or group within 60 days of April 24, 2015 pursuant to the exercise of options or warrants to be outstanding for the purpose of computing the percentage ownership of such individual or group, but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other person shown in the table. 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. Percentage of ownership is based on 52,859,953shares of common stock outstanding on March 29, 2015. Except as otherwise indicated, the address of each of the persons in this table is c/o IGI Laboratories, Inc., 105 Lincoln Avenue, PO Box 687, Buena, New Jersey 08310.

MANAGEMENT AND CORPORATE GOVERNANCE

Our Board of Directors

On March 27, 2015, our Board of Directors by pluralityaccepted the recommendation of the votes cast. Our Board of Directors has proposed the following nominees:Nominating and Corporate Governance Committee and voted to nominate Jason Grenfell-Gardner, Narendra N. Borkar, Bhaskar Chaudhuri, Damian Finio,Steven Koehler, James C. Gale and Jason Grenfell-Gardner.

AllJohn Celentano for election at the annual meeting for a term of the nominees are currently serving as our directors. The Board of Directors is currently composed of five directors. None of our directors, executive officers or nominees for director is related by familyone year to any other director, executive officer or nominee for director. If any nominee for director is unavailable to serve, we solicit discretionary authority to vote to elect another person unless we reduce the size of the Board of Directors. Each director will serve until the next2016 annual meeting of stockholders, and until his or her successor hastheir respective successors have been elected and qualified, or until his or her earlier resignation or removal. We

Set forth below are the names of the persons nominated as 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 no reasonheld directorships during the past five years. Additionally, information about the specific experience, qualifications, attributes or skills that led to believeour Board of Directors’ conclusion at the time of filing of this proxy statement that any nominee will not be available for electioneach person listed below should serve as a director for the prescribed term.is set forth below:

The following table sets forth information regarding each of our current directors⁽¹⁾ according to the information furnished to us by each such director:

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⁽¹⁾

Mr. Hemric resigned effective April 1, 2014.

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Mr. Gale was initially appointed to our Board of Directors on May 15, 2009 as a designee of the holders of Series B-1 Convertible Preferred Stock. He will act as the interim Chairman upon the expiration of Ms. Erony’s term until such time as theOur Board of Directors has appointed a new Chairman.

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Ms. Erony was initially appointed toreviewed the materiality of any relationship that each of our directors has with IGI, either directly or indirectly. Based upon this review, our Board has determined that the following members of Directors on March 13, 2009the Board are “independent directors” as defined by NYSE MKT: James C. Gale, Narendra N. Borkar, Bhaskar Chaudhuri, Steven Koehler and John Celentano.

Jason Grenfell-Gardner – President, Chief Executive Officer and Director

Jason Grenfell-Gardner, age 40, has served asPresident and Chief Executive Officer of IGI Laboratories, Inc. since July 30, 2012 and has served as a designee of the holders of Series B-1 Convertible Preferred Stock. Ms. Erony has advised us that she will not stand for re-election at the 2014 Annual Meeting. Ms. Erony has served and will continue to serve as the Chairpersonmember of our Board of Directors untilsince 2012. Prior to joining IGI, Mr. Grenfell-Gardner spent over eight years at Hikma Pharmaceuticals, PLC, and its subsidiaries, including West-Ward Pharmaceutical Corp. in the conclusionUnited States. He served in a number of roles, most recently as Senior Vice President of Sales and Marketing from 2008 to June 2012. Before joining Hikma and beginning in 1998, Mr. Grenfell-Gardner worked throughout Central and Eastern Europe as a partner at Trigon Capital, a boutique investment bank, focused on mergers and acquisitions. During his time in that region, Mr. Grenfell-Gardner served as chairman of the 2014 Annual Meeting.

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board of directors of AB Sanitas, as well as other board positions. Mr. Finio was appointedGrenfell-Gardner holds an M.A. (Hons) in Economics from the University of St. Andrews in Scotland and an MBA from INSEAD. We believe Mr. Grenfell-Gardner’s qualifications to our Board of Directors effective April 1, 2014.

A – Audit Committee

C – Organization and Compensation Committee

N – Nominating and Corporate Governance Committee

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When considering whether nominees for director have the experience, qualifications, attributes and skills, taken as a whole, to enable the Board of Directors to satisfy its oversight responsibilities effectivelyinclude his experience as a pharmaceutical executive and his experience in lightthe commercialization of our business and structure, the Nominating and Corporate Governance Committeepharmaceutical products.

Narendra N. Borkar – Director

Narendra N. Borkar, age 74, has served as a member of our Board of Directors and our Board of Directors focused primarily on the information discussed in each of the directors’ individual biographies set forth above.

In particular, with regard tosince 2009. Since 2006, Mr. Borkar has been employed as an independent consultant in the pharmaceuticals industry. From 2004 to 2006, he served as Chief Executive Officer of Aurobindo Pharma USA, Inc. From 1997 to 2003, he served as Chief Executive Officer of Caraco Pharmaceutical Laboratories, Ltd. From 1981 to 1997, he served in various senior roles for Novartis AG (formerly Ciba Geigy Corp.), from 1979 to 1981 as General Manager of Apte Amalgamations Ltd., and from 1976 to 1979 as an Engineer for Hoffmann-La Roche AG. Prior to that time, he served as a Project Manager for Union Carbide Corp. and Merck & Company, Inc. Mr. Borkar holds a B.S. in Chemical Engineering from Bombay University, an M.S. from the University of Detroit, and an MBA from Rutgers, the State University of New Jersey. We believe Mr. Borkar’s qualifications to serve on the Board of Directors consideredinclude his over forty years of experience in the pharmaceutical industry, including having heldprior positions in various senior executive positions within the brand and generic segments of majorroles at pharmaceutical companies. With regard

Bhaskar Chaudhuri – Director

Bhaskar Chaudhuri, age 60, has served as a member of our Board of Directors since 2010. Mr. Chaudhuri has more than 20 years’ experience in pharmaceutical management, research and development. Since June 2011, he has been the Operating Partner at Frazier Healthcare Ventures. Prior to that time, Mr. Chaudhuri served as President of Valeant Pharmaceuticals International, Inc. from January 2009 to September 2010. Prior to joining Valeant, Mr. Chaudhuri served for seven years as President and Chief Executive Officer of Dow Pharmaceutical Sciences, Inc. and as a member of its board of directors from 2003 to 2008, at which time Dow was acquired by Valeant. Prior to that, Mr. Chaudhuri served as Executive Vice President of Scientific Affairs at Bertek Pharmaceuticals, Inc., a subsidiary of Mylan N.V., from 1998 to 2000. Prior to his positions at Bertek, Mr. Chaudhuri served as the General Manager of the Dermatology Division of Mylan. Mr. Chaudhuri joined Mylan through the acquisition of Penederm, Inc., where he worked from 1992 to 1998 in a number of senior positions before becoming the Vice President of Research and Development. Mr. Chaudhuri serves on the boards of directors of Corium International, Inc., Silvergate Pharmaceuticals, Inc. and Thesan Pharmaceuticals, Inc. Mr. Chaudhuri holds a B.S. in Pharmacy and an M.S. in Industrial Pharmacy from Jadavpur University and a Ph.D. in Pharmaceutics from the University of Louisiana. We believe Mr. Chaudhuri’s qualifications to serve on the Board of Directors consideredinclude his over twentymany years of experience in the pharmaceutical industry, including having heldhis prior positions in senior executive positions withroles at major pharmaceutical companies. With regard

Steven Koehler – Director

Steven Koehler, age 64, has served as a member of our Board of Directors since October 13, 2014.  Mr. Koehler retired from Merck & Co., Inc. in September 2011 where, from November 2009 to September 2011, he served as Vice President, Schering-Plough Controller and Special Projects, and was a member of the Finance Senior Leadership Team.  From March 2006 to November 2009, Mr. Gale,Koehler served as Vice President, Corporate Controller of Schering-Plough Corporation, where he also served as Chief Accounting Officer and led the finance integration after Schering-Plough’s acquisition of Organon International B.V.  Prior to his positions at Schering-Plough, Mr. Koehler served in several capacities at The Medicines Company, including Senior Vice President and Chief Financial Officer, from 2004 through 2006, and Vice President, Finance and Business Administration, from 2002 to 2004.  From 2001 to 2002, Mr. Koehler was Vice President, Finance and Chief Financial Officer, of Vion Pharmaceuticals, Inc.  Prior to his position at Vion, Mr. Koehler served in a number of senior finance positions at Knoll Pharmaceuticals, Inc. and Knoll AG between 1995 and 2001.  Mr. Koehler was Vice President, Finance and Treasurer, of Boots Pharmaceuticals, Inc. from 1993 to 1995. From 1977 to 1993, he held positions in finance and accounting with the American Hospital Supply Corporation, then with Baxter International, Inc. after the two companies merged in 1985.  Mr. Koehler began his career with Arthur Andersen LLP in Chicago from 1973 to 1977.  Mr. Koehler is a Certified Public Accountant and holds a B.A. from Duke University and an MBA from the Kellogg Graduate School of Management, Northwestern University. We believe Mr. Koehler’s qualifications to serve on the Board of Directors consideredinclude his many years of experience in the pharmaceutical industry, including his senior leadership positions at several pharmaceutical companies, as well as his extensive financial experience.

James C. Gale – Director

James C. Gale, age 65, has served as a member of our Board of Directors since 2009. Mr. Gale is the Founding Partner of Signet Healthcare Partners and currently serves as its Managing Director. Prior to founding Signet in 1999, from 1991 to 1998, Mr. Gale was head of principal investment activities and investment banking at Gruntal & Co., LLC. Prior to joining Gruntal, Mr. Gale originated and managed private equity investments for Home Insurance Co., Gruntal’s parent company, from 1989 to 1994. Mr. Gale is currently the Chairman of the Board of Alpex Pharma SA. He also serves on the boards of directors of Bion Pharmaceuticals, Inc., Pfenex Inc. and SpePharm AG, and serves as lead director of Knight Therapeutics Inc. Mr. Gale holds a B.A. from the University of Arizona and an MBA from the University of Chicago. We believe Mr. Gale’s qualifications to serve on the Board of Directors include his investment experience, his role as the head of principal investment activities at Gruntal & Co., LLC, as well as his experience as a director with other pharmaceutical companies. With regard to Mr. Grenfell-Gardner, the Board of Directors considered his experience as a pharmaceutical executive with a successful track record of the commercialization of pharmaceutical products. With regard to Mr. Finio, the Board of Directors considered his over twenty years of experience in the pharmaceutical industry, including various senior management and executive positions within the brand and generic segments of major pharmaceutical companies.

Independence of DirectorsJohn Celentano – Director

Our Board of DirectorsJohn Celentano, age 55, has determined that James C. Gale, Narendra N. Borkar, Bhaskar Chaudhuri and Damian Finio are independent directors pursuant to the independence standards established by the NYSE MKT and the Securities and Exchange Commission, or the SEC.

For information relating to shares of our common stock held by each of the directors, see “Security Ownership of Certain Beneficial Owners and Management.”

Vote Required

A plurality of the votes by the stockholders entitled to vote and who are present in person or represented by proxy at the Annual Meeting will be required to elect the five nominees to our Board of Directors.

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Board Recommendation

OUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF THE FIVE NOMINEES: NARENDRA N. BORKAR; BHASKAR CHAUDHURI; DAMIAN FINIO; JAMES GALE; AND JASON GRENFELL-GARDNER.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our directors, executive officers and holders of more than 10% of our common stock, which we refer toserved as Reporting Persons, to file with the SEC and the NYSE MKT initial reports of ownership and reports of changes in ownership of our common stock and other equity securities. SEC regulations also require such persons to furnish us with copies of all such reports. Based solely on our review of copies of reports filed by Reporting Persons and furnished to us, we believe that, except as set forth below, during 2013 our officers, directors and holders of more than 10% of our common stock complied with all Section 16(a) filing requirements.

STRUCTURE AND PRACTICES OF THE BOARD OF DIRECTORS

Corporate Governance Principles

Our Certificate of Incorporation, together with all amendments and Certificate of Designations, our Bylaws, and the charters of the Audit Committee, Nominating and Corporate Governance Committee, and Organization and Compensation Committee, provide the framework for our management and governance.

Our Board of Directors is elected by and responsible to our stockholders. Except with respect to matters reserved to stockholders, the Board of Directors is our ultimate decision making body. In that capacity, the Board of Directors takes an engaged and focused approach to its responsibilities and duties, and sets standards to better ensure that we are committed to business success and enhancement of stockholder value by maintaining the highest standard of responsibility and ethics. The Board of Directors has designed its governance approach to be a working structure for principled actions, effective decision-making and appropriate monitoring of both compliance and performance. Mr. Gale will be acting as our interim Chairman upon Ms. Erony’s resignation as the chairpersonmember of our Board of Directors effectivesince March 2015.  Mr. Celentano is an advisor to the pharmaceutical industry.  He retired from Bristol-Myers Squibb Company on July 1, 2013 where he served as Senior Vice President, Amylin Integration Leader from July 2012 to June 2013 and as Senior Vice President, Human Resources, Public Affairs and Philanthropy from March 2010 to June 2012.  Mr. Celentano serves on the boards of directors of privately held JJ White Inc. and YourEncore Inc., as well as The Pennington School. Mr. Celentano additionally serves as Vice-Chairman of the endboard of directors of Catholic Medical Mission Board, an international nonprofit healthcare organization. Mr. Celentano holds a B.A. from the annual meeting.

Our employees conduct our business under the directionUniversity of senior managementDelaware and the leadership of our Chief Executive Officer, who are accountablean MBA from Drexel University. We believe Mr. Celentano’s qualifications to serve on the Board of Directors and, ultimately, to our stockholders. Management is responsible forinclude his extensive experience in the day-to-day operation of our business, strategic planning, budgeting, financial reporting and risk management.pharmaceutical industry.

Committees of the Board of Directors and Meetings

OurMeeting Attendance. During the fiscal year ended December 31, 2014,there were sixmeetings of our Board of Directors, has an Audit Committee, a Nominating and Corporate Governance Committee, and an Organization and Compensation Committee. As of April 7, 2014, the compositions of thevarious committees of the Board met a total of Directors are as follows:

^{_________________________________}

* Denotes Chairman

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Ms. Erony will resign effective at the endseven times. No director attended fewer than 75% of the total number of meetings of the Board and of committees of the Board on which he served during fiscal 2014. The Board has adopted a policy under which each member of the Board is strongly encouraged to attend each annual meeting at which time she will be replacedof our stockholders. All of our directors attended our annual meeting of stockholders held in 2014.

Audit Committee. Our Audit Committee met five times during fiscal 2014. This committee currently has three members, Steven Koehler (Chairman), Bhaskar Chaudhuri and John Celentano. 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. 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. All members of the Audit Committee satisfy the current independence standards promulgated by James Galethe SEC and by the NYSE MKT, as interim Chairman.such standards apply specifically to members of audit committees. The Board has determined that Mr. Koehler is an “audit committee financial expert,” as the SEC has defined that term in Item 407 of Regulation S-K. Please also see the report of the Audit Committee set forth elsewhere in this proxy statement.

11A copy of the Audit Committee’s written charter is publicly available on our website atwww.igilabs.com.

Organization and Compensation Committee. Our Board of DirectorsOrganization and Compensation Committee met once during fiscal 2014. This committee currently has adopted a charter governing the dutiesthree members, Narendra Borkar (Chairman), James C. Gale and John Celentano. Our Organization and Compensation Committee’s role and responsibilities ofare set forth in the Organization and Compensation Committee. The full textCommittee’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 charterBoard of theDirectors are carried out and that such policies, practices and procedures contribute to our success. Our Organization and Compensation Committee also administers our 2009 Equity Incentive Plan, as amended (the “2009 Plan”), and our 1999 Director Stock Option Plan, as amended (the “1999 Director Plan”). The Organization and Compensation Committee is available on our website atwww.igilabs.com. Pursuant toresponsible for the charter, the purposesdetermination of the Committee are to: (i) recommend to the Board of Directors compensation arrangements for the Chief Executive Officer and other executive officers and review their responsibilities and performance and plans for their succession; and (ii) approve compensation arrangements for and changes in other corporate officers. In furtherance of this purpose, the Committee shall have, without limitation, the following goals and responsibilities:

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Review with appropriate representatives of our management our organizational structurechief executive officer, and in particular,shall conduct its decision making process with respect to that issue without the responsibilities and performance ofchief executive officers and, from time to time, senior operations executives and the plans for their succession, and to report at least annually thereon to the Board of Directors;

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Consider appropriate competitive data and recommend to the Board of Directors compensation and fringe benefits (except pensions generally applicable to salaried employees) for executive officers;

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Consider appropriate competitive data, and any recommendation made by the Chief Executive Officer and approve: (i) executive salary structure; and (ii) compensation and fringe benefits (except pensions generally applicable to salaried employees) for other corporate officers;

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In connection with our annual incentive compensation programs, each year: (i) review and approve the Chief Executive Officer’s goals and his/her performance against those goals; (ii) approve annual incentive compensation targets; (iii) approve an annual incentive compensation award for the Chief Executive Officer, other executive officers and other corporate officers; (iv) review the annual performance objectives of the other executive officers; and (v) review annual incentive compensation awards for senior operations executives; and

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Review with appropriate officers: (i) changes in corporate officers; (ii) policy on matters pertaining to compensation; (iii) special benefits and perquisites; (iv) each year on a retrospective basis, compensation changes made in the prior year to determine whether policies established by the Committee have been executed as intended and are achieving the intended result; (v) each year on a retrospective basis, corporate results against corporate goals; and (vi) any other matter of concern to the Committee relating to our overall corporate organization or compensation policy.

The currentofficer present. All members of the Organization and Compensation Committee are Narendra Borkar (Chair)qualify as independent under the definition promulgated by the NYSE MKT.

The Organization and Joyce Erony, who will be replacedCompensation Committee has the authority to directly retain the services of any consulting firm to assist in fulfilling its responsibilities and to approve any fee arrangements for work performed. The Compensation Committee’s independent compensation consultant during fiscal year 2014 was the Hay Group (the “Hay Group”). The Hay Group was engaged by, James Gale effective as ofand reported directly to, the end ofOrganization and Compensation Committee, which had the annual meeting. We believe thatsole authority to hire or fire them and to approve fee arrangements for work performed. The Hay Group assisted the compositionOrganization and functioningCompensation Committee in fulfilling its responsibilities under its charter, including advising on proposed compensation packages for executive officers, compensation program design and market practices generally. The Organization and Compensation Committee authorized the Hay Group to interact with management on behalf of the Organization and Compensation Committee, as needed, in 2013 compliesconnection with alladvising the Organization and Compensation Committee, and the Hay Group was included in discussions with management and, when applicable, requirementsthe Organization and Compensation Committee’s outside legal counsel on matters being brought to the Organization and Compensation Committee for consideration. As described in “Compensation Discussion and Analysis – Compensation Consultants,” the Hay Group assisted the Organization and Compensation Committee in defining the appropriate market of our peer companies for executive compensation and practices. The Hay Group also assisted the Organization and Compensation Committee in comparing our director compensation program and practices against those of our peers. We used the information we obtained from the Hay Group primarily for evaluating our executive compensation practices, including measuring the competitiveness of our practices. The Organization and Compensation Committee has assessed the independence of the Sarbanes-Oxley ActHay Group pursuant to SEC rules and the corporate governance rules of 2002,the NYSE MKT and SEC rulesconcluded that no conflict of interest existed that would have prevented the Hay Group from independently representing the Organization and regulations, including those regardingCompensation Committee.

The Organization and Compensation Committee, and, where applicable, the independenceChief Executive Officer reviews the performance of each named executive officer in light of the above factors and determines whether the named executive officer should receive any increase in base salary or receive a discretionary equity award based on such evaluation. During fiscal year 2014, the Organization and Compensation Committee did not adhere to a formula or other quantitative measures with respect to compensation but rather relied on qualitative and subjective evaluations to determine the appropriate levels of compensation for our named executives.

Please also see the report of the Organization and Compensation Committee Members. During our 2013 fiscal year,set forth elsewhere in this proxy statement.

A copy of the Organization and Compensation Committee met two times.

Audit Committee. The Audit Committee has been established for the purpose of overseeing our accounting and financial reporting processes and the audit of our annual financial statements, as well as our internal controls and audit functions. The Audit Committee operates under aCommittee’s written charter adopted by the Board of Directors. The full text of the charter of the Audit Committee is publicly available on our website atwww.igilabs.com.

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As described more fully in the Audit Committee Charter, the purpose of the Audit Committee is to assist the Board of Directors in fulfilling its responsibilities to stockholders concerning our accounting and reporting practices, and to facilitate open communication between the Audit Committee, the Board of Directors, our outside auditor and management. The Audit Committee is required to discharge its responsibilities, and assess the information provided by our management and the outside auditor, in accordance with its business judgment. In exercising its business judgment, the Audit Committee is required to rely on the information and advice provided by management and/or our outside auditor. Pursuant to its charter, the function of the Audit Committee includes, without limitation:

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to provide the opportunity for direct communication between our Board of Directors and our external auditors;

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to monitor the design and maintenance of our system of internal accounting controls;

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to select, evaluate and, if necessary, replace the external auditor;

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to review the results of internal and external audits as to the reliability and integrity of the financial and operating information systems established to monitor compliance with our policies, plans and procedures and with laws and regulations; and

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to review the relationship between us and the external auditors and to ascertain the independence of the external auditors.

The members of the Audit Committee in 2013 were Bhaskar Chaudhuri (Chair) and Michael Hemric. Effective April 1, 2014, Mr. Finio filled the vacancy on the Audit Committee that was created by Mr. Hemric’s resignation, and he is succeeding Mr. Chaudhuri as Chair. We believe that the composition and functioning of our Audit Committee in 2013 complied with all applicable requirements of the Sarbanes-Oxley Act of 2002, NYSE MKT and SEC rules and regulations, including those regarding the independence of the Audit Committee members. The Board of Directors determined that Bhaskar Chaudhuri was, while Chair of the Audit Committee during 2013 and until his replacement by Mr. Finio, and Mr. Finio currently is, an “audit committee financial expert” as currently defined under the SEC’s rules implementing Section 407 of the Sarbanes-Oxley Act of 2002. During our 2013 fiscal year, the Audit Committee met four times.

Nominating and Corporate Governance Committee. Our Board of DirectorsNominating and Corporate Governance Committee met once during fiscal 2014 and has adopted a charter governing the dutiestwo members, Bhaskar Chaudhuri (Chairman) and James C. Gale. The Nominating and Corporate Governance Committee’s role and responsibilities ofare set forth in the Nominating and Corporate Governance Committee. TheCommittee’s written charter and include evaluating and making recommendations to the full textBoard as to the size and composition of the charterBoard and its committees, evaluating and making recommendations as to potential candidates and evaluating current Board members’ performance. Both members of the Nominating and Corporate Governance Committee qualify as independent under the definition promulgated by NYSE MKT.

If a stockholder wishes to nominate a candidate for director who is available onnot to be included in our websiteproxy statement, it must follow the procedures described in our Amended and Restated By-Laws and in “Stockholder Proposals and Nominations for Director” atwww.igilabs.com. Pursuant to the charter, the purposeend of this proxy statement.

In addition, under our current corporate governance policies, the Nominating and Corporate Governance Committee is to identify individuals qualified to become members of our Board of Directors, and to recommend that our Board of Directors select the director nominees for the next annual meeting ofmay consider candidates recommended by stockholders to develop and recommend to the Board of Directors a set of corporate governance principles applicable to us, and to make recommendations on compensation of the Board of Directors. In furtherance ofas well as from other sources, such purpose,as other directors or officers, third party search firms or other appropriate sources. For all potential candidates, the Nominating and Corporate Governance Committee shall have, without limitation,may consider all factors it deems relevant, such as a candidate’s personal integrity and sound judgment, business and professional skills and experience, independence, knowledge of the following goals and responsibilities:

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To identify, review and recommendindustry in which we operate, possible conflicts of interest, diversity, the extent to which the candidate would fill a present need on the Board of Directors, qualified candidatesand concern for director nominees to fill any existing or anticipated vacancythe long-term interests of the stockholders. In general, persons recommended by stockholders will be considered on the Board of Directors;

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To identify, review and recommendsame basis as candidates from other sources. If a stockholder wishes to the Board of Directors, prior to each year’s annual meeting of stockholders, successors to the class of directors whose term shall then expire (including any director in such class proposing to standpropose a candidate for election to another term), and additional director nominees, if any, for election to the Board of Directors on whose behalf the Board of Directors will solicit proxies;

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To recommend to the Board of Directors the size of the Board of Directors;

·

To review and make recommendations to the Board of Directors with respect to suggestions for director nominees made by stockholders to the Board of Directors or to management in accordance with our Bylaws;

·

To review annually the Board of Director’s overall performance and oversee the annual performance evaluation for each of its committees;

·

To recommend to the Board of Directors whether resignations tendered by members who have hadconsideration as a substantial change in their job responsibilities should be accepted;

·

To review annually the Board of Director’s committee structure, charters and membership and recommend to the Board of Directors changes, if any; and, in consultation with the Chairman of the Board of Directors, recommend to the Board of Directors the assignment of members of the Board of Directors to the various committees and appointment, rotation or removal of committee chairs;

·

To review and make recommendations to the Board of Directors with respect to changes in directors’ compensation and benefits; and

·

To develop and recommend to the Board of Directors a set of corporate governance guidelines and to review the guidelines at least annually and recommend changes as necessary.

The Nominating and Corporate Governance Committee shall have sole authority to retain and terminate any consulting firm to assist it in carrying out its duties and responsibilities, as the committee may deem appropriate in its sole discretion. The Nominating and Corporate Governance Committee shall have sole authority to approve related fees and other retention terms.

The Nominating and Corporate Governance Committee’s process for recruiting and selecting nominees is for Committee members to attempt to identify individuals who are thought to have certain minimum qualifications, including appropriate business background and experience, industry specific knowledge and general reputation and expertise that would allow them to contribute as effective directors to our governance, and who are willing to serve as directors of a public company. The Nominating and Corporate Governance Committee also considers such other factors as it deems appropriate, including the current composition of the Board of Directors. The Committee and Board believe that Board membership should reflect diversity in its broadest sense, including persons diverse in skills, background, gender and ethnicity. The Committee has not adopted a formal policy for the consideration of diversity in identifying candidates for the Board.

To date, we have not engaged any third party to assist in identifying or evaluating potential nominees. After a possible candidate is identified, the individual meets with various members of the Committee to ascertain his or her interest and willingness to serve, and Committee members discuss among themselves the individual’s potential to be an effective member of the Board of Directors. If the discussions and evaluation are positive, the individual is recommendednominee by the Nominating and Corporate Governance Committee under our corporate governance policies, it should submit such recommendation in writing to the entire Board of Directors.

14

The entire Board of Directors, including the Nominating and Corporate Governance Committee, approved the nomination of the candidates reflected in Proposal No. 1. The Nominating and Corporate Governance Committee will consider stockholder recommendations for candidates to serve on the Board of Directors. The name of any recommended candidate for director, together with pertinent biographical information, a document indicating the candidate’s willingness to serve if elected, and evidence of the nominating stockholder’s ownership of our common stock should be sent to the Nominating and Corporate Governance Committee c/o IGI Laboratories, Inc., Corporate Secretary at our corporate offices, 105 Lincoln Avenue, PO Box 687, Buena, New Jersey 08310. To date, the

The Nominating and Corporate Governance Committee has not adoptedconsiders issues of diversity among its members in identifying and considering nominees for director, and strives, where appropriate, to achieve a specific formal policy with respect todiverse balance of backgrounds, perspectives, and experience on the consideration of director candidates recommended by stockholdersboard and to date no director candidates have been recommended by stockholders. If a director candidate were to be recommended by a stockholder, the Nominating and Corporate Governance Committee expects to evaluate such candidate in the same manner it evaluates director candidates it identifies.its committees.

The membersA copy of the Nominating and Corporate Governance Committee’s written charter is publicly available on the Company’s website atwww.igilabs.com.

Organization and Compensation Committee in 2013 were Michael Hemric (Chair)Interlocks and Insider Participation. Our Organization and Compensation Committee has three members, Narendra Borkar (Chairman), James Gale. On April 1, 2014, Mr. Hemric resigned,C. Gale and he was replaced with Mr. Chaudhuri, who is the current ChairJohn Celentano. No member of the committee.Organization and Compensation Committee has been an officer or employee of IGI. None of our executive officers serves on the board of directors or compensation committee of a company that has an executive officer that serves on our Board of Directors or Organization and Compensation Committee.

Board Leadership Structure and Role in Risk Oversight

Our Board of Directors has five independent members and one non-independent member who serves as our President and Chief Executive Officer. We believe that the compositionnumber of the current Nominating and Corporate Governance Committee, and as composed in 2013, complies with all applicable requirements of the Sarbanes-Oxley Act of 2002, NYSE MKT and SEC rules and regulations, including those regarding the independence of the Nominating and Corporate Governance Committee members. The Nominating and Corporate Governance Committee met one time during the 2013 fiscal year. Since the Nominating and Corporate Governance Committee is composed solely of non-managementindependent, experienced directors all nominees for director at the Annual Meeting were nominated by non-management directors.

Board Meeting and Attendance

During our 2013 fiscal year,that make up our Board of Directors, met four times. Each incumbent director attended at least 75%along with the independent oversight of the total numberBoard of Directors by the Non-Executive Chairman, benefits our company and our shareholders. All of our independent directors have demonstrated leadership in other organizations and are familiar with board of director processes.

The Chairman of the Board of Directors presides at all meetings of the Board of Directors. The Chairman is appointed on an annual basis by a majority vote of the directors. Currently, the offices of Chairman of the Board of Directors and each committeeChief Executive Officer are separated. We have no fixed policy with respect to the separation of the offices of the Chairman of the Board of Directors on which such director served.

As required, independent membersand Chief Executive Officer. Currently, two separate individuals serve in the positions of Chairman of our Board of Directors meetand Chief Executive Officer. We believe that our current leadership structure is optimal for the Company at this time.

Our management is principally responsible for defining the various risks facing the Company, formulating risk management policies and procedures, and managing our risk exposures on a day-to-day basis. The Board of Directors’ principal responsibility in executive sessions outsidethis area is to ensure that sufficient resources, with appropriate technical and managerial skills, are provided throughout the presenceCompany to identify, assess and facilitate processes and practices to address material risk and to monitor our risk management processes by informing itself concerning our material risks and evaluating whether management has reasonable controls in place to address the material risks. The involvement of the Board of Directors in reviewing our business strategy is an integral aspect of the Board of Directors’ assessment of management’s tolerance for risk and also its determination of what constitutes an appropriate level of risk for the Company.

While the full Board of Directors has overall responsibility for risk oversight, the Board of Directors has elected to delegate oversight responsibility related to certain risks committees, which in turn report on the matters discussed at the committee level to the full Board of Directors. For instance, our Audit Committee focuses on the material risks facing the Company, including operational, market, credit, liquidity and legal risks. Additionally, our Organization and Compensation committee could be charged with reviewing and discussing with management whether our compensation arrangements are consistent with effective controls and sound risk management. Our management reports to the Board of Directors and Audit Committee on a regular basis regarding risk management.

Stockholder Communications with Directors and Director Attendance at Annual Meetingsto the Board

Stockholders who wish to send communications to our Board of Directors may do so by sending them c/o IGI Laboratories, Inc., Corporate Secretary, 105 Lincoln Avenue, PO Box 687, Buena, New Jersey 08310. Such communications may be addressed either to specified individual directors or the entire Board of Directors. The Corporate Secretary will have the discretion to screen and not forward to directors communications that the Corporate Secretary determines are communications unrelated to our business or governance, commercial solicitations, offensive, obscene, or otherwise inappropriate. The Corporate Secretary will, however, compile all stockholder communications that are not forwarded and such communications will be available to any director.

It is the policy of our Board of Directors that directors are strongly encouraged to attend all annual stockholder meetings. Each of our directors serving at the time attended the 2013 annual meeting of stockholders.

Board Leadership Structure

The Chairman of the Board of Directors presides at all meetings of the Board of Directors. The Chairman is appointed on an annual basis by a majority vote of the directors. Currently, the offices of Chairman of the Board of Directors and Chief Executive Officer are separated. We have no fixed policy with respect to the separation of the offices of the Chairman of the Board of Directors and Chief Executive Officer. The Board of Directors believes that the separation of the offices of the Chairman of the Board of Directors and Chief Executive Officer is part of the succession planning process and that it is in the best interests of the company to make this determination from time to time.

15

Oversight of Risk Management

We are exposed to a number of risks and we regularly identify and evaluate these risks and develop plans to manage them effectively. Our Chief Executive Officer and Chief Financial Officer are directly responsible for our risk management function and report to our Board of Directors and Audit Committee in this regard. In fulfilling their risk management responsibilities, our Chief Executive Officer and Chief Financial Officer work closely with members of senior management, including our accounting staff.

On behalf of the Board of Directors, the Audit Committee plays a key role in the oversight of our risk management policy. In that regard, the Chief Financial Officer meets with the Audit Committee at least four times a year to discuss the risks facing us, highlighting any new risks that may have arisen since they last met. The Audit Committee reports to the Board of Directors on a regular basis to apprise them of their discussions with the Chief Financial Officer. Finally, the Chief Financial Officer and Chief Executive Officer report directly to the Board of Directors on at least an annual basis to apprise them directly of our risk management efforts.

Standards of Business Conduct

The Company has adopted written standards of business conduct that applies to all directors, officers and employees of the Company and its subsidiaries. The Company’s policy on standards of business conduct is available at its website atwww.igilabs.com. Any amendments to the standards of business conduct policy or waivers from the provisions of such policy for the Company’s principal executive officer and principal financial and accounting officer will be disclosed in a Current Report on Form 8-K filed with the SEC 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 NYSE MKT.

EXECUTIVE COMPENSATION

Executive Officers

During the year ended December 31, 2013,2014, we had twoone executive officers. In addition to Jason Grenfell-Gardner, whose biography is set forth above in “Proposal No. 1 — Election of Directors,” Jenniferofficer who was not also a director, Jenniffer Collins, servedwho serves as our Chief Financial Officer. We have employment agreements with each of our executive officers, Jason Grenfell-Gardner and Jenniffer Collins. See the section of our proxy statement entitled “Executive Officer and Director Compensation – Employment Agreements with Executive Officers.”

Jenniffer Collins – Chief Financial Officer

Jenniffer Collins, age 45, has served as our Chief Financial Officer fromsince July 2011 to the present.2011. Ms. Collins has over twenty years of experience in accounting and finance. Prior to joining IGI, she most recently served, fromsince October 2006, to July 2011,she served as Vice President-TreasurerPresident - Treasurer and, previously, the Corporate Controller atof the Lightstone Group, a privately held real estate firm, and The Lightstone Value Plus REIT, a publicly traded real estate investment trust. From January 2004 through October 2006, Ms. Collins also served as Corporate Controller forof Orchid Cellmark, Inc., a publicly held biotechnology company, and, from July 2001 through January 2004, Ms. Collins served as Director of Finance and Investor Relations for Tellium, Inc., a publicly held optical switching company, which was purchased by Zhone Technologies, Inc. in November 2003. Her background also includes seven years of public accounting experience, including at Pricewaterhouse Coopers. Ms. Collins earned her CPA in New Jersey in 1993 and graduated with a B.S. in accounting from Lehigh University.

16COMPENSATION DISCUSSION AND ANALYSIS

Compensation Discussion and Analysis

2013

The following Compensation Discussion and Analysis presents an overview of our compensation program, focusing on the elements of compensation awarded or paid to our President and Chief Executive Officer and our Chief Financial Officer, or our “Named Executive Officers.”

Summary of 2014 Results

We are pleased with another year of progress that we believe is due to management’s effective and successful execution of the Company’s strategic objectives established by our President and Chief Executive Officer and the Board of Directors.  The key highlights and accomplishments for our 2014 fiscal year include the following:

The Organization and Compensation Committee consulted with the Hay Group, an independent third party, in November 2014, to conduct a market benchmark study and review the compensation arrangements between the Company and its Named Executive Officers in comparison to their peers set forth below. Specifically, the independent third party’s assessment focused on the following areas of review:

Make Whole Equity Incentive Grants. On February 11, 2015, because our Named Executive Officers had not received any equity grants since joining IGI (aside from equity grants pursuant to their employment agreements), the Organization and Compensation Committee decided to issue a one-time, make whole equity grant to each of our Named Executive Officers as follows:

Annual Equity Incentive Program for Management.On February 11, 2015, the Organization and Compensation Committee also decided to institute an annual equity incentive program for our Named Executive Officers pursuant to which we would issue, in the sole discretion of our Organization and Compensation Committee, to our (i) President and Chief Executive Officer, an annual equity grant of options to purchase shares of our common stock and/or RSUs, in an amount equal to 100% of his annual base salary, and (ii) Chief Financial Officer, an annual equity grant of options to purchase shares of our common stock and/or RSUs, in an amount equal to 60% of her annual base salary. The equity grants would be made pursuant to our 2009 Plan and, if granted, would be subject to a three-year vesting schedule. The allocation of different securities within each annual equity grant shall be determined by the Organization and Compensation Committee in its sole discretion. The first such annual equity grants were approved on February 11, 2015, and were as follows:

Bonuses. Based on IGI’s strong performance for the fiscal year end 2014, the Organization and Compensation Committee recommended cash bonuses of 115% of the target bonus for our President and Chief Executive Officer (or $281,750) and 114% of the target bonus for our Chief Financial Officer (or $74,714). The Organization and Compensation Committee further decided, in light of what they believed to be the significant contributions of our Named Executive Officers during our fiscal year ended 2014, to grant one-time performance bonuses of $75,000 in cash and 25,000 RSUs to our President and Chief Executive Officer and $30,000 in cash and 7,500 RSUs to our Chief Financial Officer. The common stock underlying each such grant of RSUs vested fully on the date of grant.

Compensation Philosophy and Objectives.

The Organization and Compensation Committee leads the development of our compensation philosophies and practices, and attempts to ensure that the total compensation paid to our executive officers is fair and reasonable relative to the extremely competitive nature of the specialty generic pharmaceutical industry. For several years, our Company forged through business and financial challenges, and it was not until more recently that the Company has experienced a significant turn-around that is largely attributable to the success of our current management team. During the challenging downturn years, the Organization and Compensation Committee focused intently on attracting and rewarding executives with the unique intersection of industry and turnaround skills and made compensation decisions based on our objective of aligning the Company’s key executives’ goals and incentive pay with the goals of our shareholders in order to enable and encourage the turn-around effort, while considering the significant cash constraints the Company operated under from 2010 to 2014. Consistent with our ongoing goal to keep the Company’s key executives’ objectives and incentive pay aligned with the goals of our shareholders, we continue to pursue a compensation philosophy that is intended to provide total compensation opportunities, which include base salary, bonus, long term equity compensation and a health and welfare benefits package intended to incentivize the uniquely skilled employees who will continue to carry out our strategic plan, mission and goals, while maintaining our required high quality standards and growth.

In 2014, we refined our compensation philosophy to reflect the Company’s current progress toward its mission to be a leader in the specialty generic pharmaceutical industry in order to align it with the achievement of the Company’s business strategies, and to be consistent with the compensation structure of our industry peers.  Accordingly, we developed and adopted a philosophy that is intended to serve the foundation upon which the executive compensation program is structured and administered and to serve as a basis for guiding the continued development and evolution of the program.

Our compensation philosophy is based on the following goals and principles:

Role of Organization and Compensation Committee and Management

Our Organization and Compensation Committee is composed exclusively of independent directors and meets regularly both with and without management present. The Organization and Compensation Committee annually sets Named Executive Officer base salaries, establishes annual incentive compensation pay for performance objectives based on both individual and company goals, makes actual awards of annual incentive compensation based on attainment of these goals and other factors the Organization and Compensation Committee deems appropriate, and considers awards of long-term equity compensation. In connection with its review and determination, the Organization and Compensation Committee considers the input of the Chairman of our Board, who conducts a detailed review of the performance of our President and Chief Executive Officer based on the Chairman’s substantial and meaningful experience in ownership and management of pharmaceutical and life science companies.  Our Chairman also presents his recommendation to the Organization and Compensation Committee for any change in base salary or other compensation components for our President and Chief Executive Officer.  The Organization and Compensation Committee also seeks input from the President and Chief Executive Officer, particularly related to the establishment and measurement of corporate and individual objectives and recommendations related to overall employee compensation matters.

Our President and Chief Executive Officer reviews the performance of, and proposes salary increases for, all managers who report to him, including the other Named Executive Officer. Any increases are generally based upon the individual’s performance during the previous year in addition to the Company’s performance as it relates to the key objectives established at the beginning of the year.  The Organization and Compensation Committee reviews and approves the reasonableness of any proposed compensation for the Named Executive Officers. In conducting its review and making its determinations, the Organization and Compensation Committee reviews a history of base salary, cash incentive bonus targets and payouts and equity awards, prepared by the Company’s Human Resources Department (“HR”).  During the year, our President and Chief Executive Officer may not change the base salary of the managers who report to him without the prior approval of our Organization and Compensation Committee.    

Our HR evaluates compensation levels and composition and fashions competitive pay packages on a company-wide basis.  HR also works with the President and Chief Executive Officer in planning for recruitment and retention of employees.  

Compensation Consultants

The Organization and Compensation Committee has maintained a structured approach to compensation for our Named Executive Officers and, in 2014, retained its own independent compensation consultant to provide the Organization and Compensation Committee with support, advice and recommendations. In 2014, our compensation consultant worked with the Organization and Compensation Committee in comparing our executive compensation with pertinent market data taken from published salary surveys reflecting a broad range of entities, both within and outside our own specialty pharmaceutical industry. The study also included publicly reported data from the following selected peer group: Aceto Corporation; Amphastar Pharmaceuticals, Inc.; ANI Pharmaceuticals, Inc.; Antares Pharmaceuticals, Inc.; Cambrex Corporation; DepoMed Inc.; Flamel Technologies SA; Insys Pharmaceuticals, Inc.; Intellipharmaceutics International, Inc.; Lannett Company, Inc.; Sagent Pharmaceuticals, Inc.; Sciclone Pharmaceuticals, Inc.; and Tetraphase Pharmaceuticals, Inc. The Organization and Compensation Committee reviewed these surveys and information in order to obtain a general understanding of current compensation practices and trends for specific positions held as opposed to solely focusing on the Named Executive Officers.  This analysis was reviewed in order to confirm the appropriate data, measures and comparisons.

With respect to establishing the overall compensation of the President and Chief Executive Officer and Chief Financial Officer, we gathered, analyzed and evaluated the compensation mix provided by our peer group, while keeping in mind the other factors set forth in the Organization and Compensation Committee’s charter.  We do not select a specific target or benchmark our Named Executive Officers’ compensation at a certain level or percentage based on other companies’ compensation arrangements. Based on our review of these sources, we have determined that our total compensation and cash compensation for our Named Executive Officers fell significantly below the aggregated 50^th percentile of the named executive officers of our peer group. Our goal was to structure our compensation in a manner where the compensation would be competitive in the market place with a long term focus for our Named Executive Officers’ compensation structure comes from their Long Term Incentive Awards.

The Organization and Compensation Committee has analyzed whether the work of our current compensation consultant, the Hay Group, has raised any conflict of interest, taking into consideration the following factors: (i) the provision of other services to the Company by the Hay Group; (ii) the policies and procedures of the Hay Group that are designed to prevent conflicts of interest; (iii) any business or personal relationship of the Hay Group or the individual compensation advisors employed by the Hay Group with our President and Chief Executive Officer; (iv) any business or personal relationship of the individual compensation advisors with any member of the Organization and Compensation Committee; and (v) any stock of the Company owned by the Hay Group or the individual compensation advisors employed by the Hay Group. The Organization and Compensation Committee has determined, based on its analysis of the above factors, that the work of the Hay Group and the individual compensation advisors employed by the Hay Group as compensation consultants to the company has not created any conflict of interest.

Components of Compensation

Our compensation program generally provides equivalent benefits for all salaried and hourly-paid employees. For our managers, directors and vice presidents, including our executive officers, we provide additional compensation designed to reward performance.  For 2014, the principal components of compensation for our Named Executive Officers were:

Base Salary.  The salaries for our Named Executive Officers have been established in order to be competitive with market practices so as to allow us to attract and retain senior executive talent. Salary decisions are also influenced by equity grants based on the relationship between salaries among the executives and each executive’s role and responsibilities and the impact on the Company’s performance.  Other factors considered by the Organization and Compensation Committee include an executive’s experience, specific skills, tenure and individual performance. In setting base salaries for the Named Executive Officers, we also consider how equity can be used to balance an executive’s overall compensation to make it competitive based on an analysis of peer group data.   In 2014, the base salaries of our President and Chief Executive Officer and Chief Financial Officer were increased from $325,000 to $361,846 and from $212,100 to $226,572, respectively.

Performance-Based Annual Bonus.Each year, the Organization and Compensation Committee adopts guidelines pursuant to which it calculates the annual cash incentive awards available to our Named Executive Officers, subject to the Organization and Compensation Committee’s oversight and modification. The Organization and Compensation Committee believes that our annual incentive program provides our Named Executive Officers with a team incentive to both enhance our financial performance and perform at the highest level. The terms of these programs are not contained in a formal written plan. No executive is part of an incentive plan that has any guaranteed bonus amounts.

We structured specific annual incentive compensation pay for 2014 based upon the Company’s achievement of its overall corporate goals. In addition, the Chief Financial Officer’s annual incentive compensation pay is based on individual performance goals set and established by the President and Chief Executive Officer and reviewed and approved by the Organization and Compensation Committee.  After our Board of Directors reviewed the strategic plan and budget for the year, the Organization and Compensation Committee set annual corporate goals designed to induce achievement of that plan and budget.  For 2014, in accordance with the employment agreement for the President and Chief Executive Officer, our President and Chief Executive Officer’s bonus target was set at 70% of base compensation, and the Chief Financial Officer’s bonus was set at 30% of base compensation

Since the Company exceeded all of its overall corporate and budget goals for 2014, bonuses were paid for 2014 as follows:

Where:

Not included in the table are the following RSU grants made on February 11, 2015: an aggregate of 110,000 RSUs to our President and Chief Executive Officer, which are valued at $10.67 per share, and an aggregate of 39,000 RSUs to our Chief Financial Officer, which are valued at $10.67 per share.

For the year ended 2014, the Company’s overall corporate objectives were as follows:

Given that the foregoing goals were met, our Board of Directors, based on the recommendation of our Organization and Compensation Committee, determined that our Named Executive Officers were entitled to the additional discretionary bonuses paid.

Long Term Incentive Compensation. The Organization and Compensation Committee considered how equity can be used to balance an executive’s overall compensation to make it competitive based on an analysis of peer group data as well as to incentivize our Named Executive Officers. Based on the foregoing considerations of competitiveness and incentivization, we decided to increase the equity compensation portion of our executive’s overall compensation.

Benefits.

Employment and Consultant Agreements.  The Company entered into employment agreements with its President and Chief Executive Officer and Chief Financial Officer in connection with their hiring.  The Company does not have employment agreements with any other employees.

Company-Wide Benefits.   Executive officers and all full-time employees are eligible to participate in the Company’s standard benefit program, which includes health insurance, 401(k), disability and life insurance, flexible spending accounts, travel assistance, paid time off and holidays.  The Company matches employee 401(k) contributions at a rate of 100% of the first 3% of compensation contributed by participants and 50% of the next 2% of compensation contributed by participants. We do not offer any benefits to our Named Executive Officers that are not offered to our other employees.

Other Considerations.

Tax Considerations.  It has been and continues to be our intent that all non-equity incentive payments be deductible unless maintaining such deductibility would undermine our ability to meet our primary compensation objectives or is otherwise not in our best interest. At this time, essentially all compensation (except certain equity incentives) paid to the Named Executive Officers is deductible under Section 162(m) of the Internal Revenue Code.  We also regularly analyze the tax effects of various forms of compensation and the potential for excise taxes to be imposed on the executive officers which might have the effect of frustrating the purposes of such compensation.

Accounting Treatment Considerations.  We are especially attuned to the impact of Accounting Standards Codification (“ASC”) Topic 718, Stock Compensation, with respect to the grant and vesting of equity compensation awards.  Prior to the granting of such awards, we analyze the short and longer-term effects of any particular award on our budget for the year of grant and anticipated financial impact in future years.  This information is taken into account in determining the type and vesting parameters for equity-based compensation awards.

Timing of Equity Grants and Equity Grant Practices.  The Organization and Compensation Committee recommends to the Board equity compensation to all of the Named Executive Officers and all other Company employees.  All awards are made based on the closing price of our stock on the date of the approved award.  In addition, awards may be made to new employees upon their joining the Company, and to employees who are promoted during the year.  The timing of such awards depends on those specific circumstances and is not tied to any other particular company event, anticipated events or announcements.

COMPENSATION COMMITTEE REPORT

The Organization and Compensation committee of our Board of Directors has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K, which appears elsewhere in this proxy statement, with our management. Based on this review and discussion, the Organization and Compensation Committee has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in our proxy statement.

RISKS RELATED TO COMPENSATION PRACTICES AND POLICIES

Consistent with SEC disclosure requirements, we have assessed the Company’s compensation policies, practices and awards and have concluded that our compensation policies, practices and awards do not create risks that are reasonably likely to have a material adverse effect on the Company. Our management assessed the Company’s compensation and benefits programs to determine if the programs’ provisions and operations create undesired or unintentional risk of a material nature. We do not have any programs where a participant may be able to directly affect variability or timing of a payout. Rather, our compensation programs include a combination of fixed base salaries, cash bonuses, long-term incentive awards and employee retirement plans that are generally uniform in design and operation throughout the Company and with all levels of employees.

Based on the foregoing, we believe that our compensation policies, practices and awards do not create risks that are likely to have a material adverse effect on the Company as a whole. We also believe that our incentive compensation arrangements provide incentives that do not encourage risk-taking beyond the organization’s ability to effectively identify and manage significant risks, are compatible with our effective internal controls and our risk management practices, and are supported by the oversight and administration of the Compensation Committee with regard to executive compensation programs.

EXECUTIVE OFFICER AND DIRECTOR COMPENSATION

Summary Compensation Table

The following table sets forthshows the total compensation forpaid or accrued during the previous twolast three fiscal years ended December 31, 2014, 2013 and 2012 which was earned by eachto our Chief Executive Officer and our Chief Financial Officer.

2014 Fiscal YearGrants of Plan-Based Awards

There were no grants of non-equity incentive plan awards or grants of equity awards made to our currentexecutive officers during the fiscal year ended December 31, 2014.

Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table

Employment Agreements with Executive Officers

President and Chief Executive Officer.Jason Grenfell-Gardner joined IGI as our President and Chief Executive Officer who served during all of 2013 and part of 2012, our current Chief Financial Officer and our former President and Chief Executive Officer, who ceased to be employed in 2012. We refer to these people in this Proxy Statement as our Named Executive Officers.

^{_________________________________}

⁽¹⁾

Lists the principal positions held as of December 31, 2013. Onentered into an employment agreement, effective July 30, 2012 the Company appointed Jason Grenfell-Gardner as the Company’s new President and Chief Executive Officer, effective July 30, 2012. Charles E. Moore ceased to be employed by the Company and resigned as a member of the Board, effective July 30, 2012.

⁽²⁾

The amounts shown in this column represent the fair value of the awards on the date of grant, as computed in accordance with FASB ASC Topic 718.

⁽³⁾

The amounts reflected in this column represent the fair value of the awards on the date of grant, as computed in accordance with FASB ASC Topic 718. We valued these options using a Black-Scholes option pricing model. In the model, we used an expected life of 3.2 years to value the ten year options that we issued. We used an interest rate equal to the yield on the treasury bonds that have approximately 3.2 years remaining until maturity and used the volatility of our stock price over a period that is approximately five and one-half years prior to the grant date.

⁽⁴⁾

The amounts shown in this column represent premiums for group life insurance, medical, and dental insurance paid by us, and contributions made by us under our 401(k) Plan.

⁽⁵⁾

Represents severance paid to Mr. Moore.

17

Narrative Disclosure for Summary Compensation Table

Jason Grenfell-Gardner. Jason Grenfell-Gardner commenced serving as our President and Chief Financial Officer and as a member of our Board of Directors effective July 30, 2012. Under his employment agreement, Mr. Grenfell-Gardner received an annual salary of $315,000 for the years ended December 31, 2012 and 2013. In connection with his employment agreement, Mr. Grenfell-Gardner received an option to purchase 975,000 shares of the Company’s common stock (the “Primary OptionCEO Employment Agreement”) and a supplemental option to purchase 25,000 shares of. Under the Company’s common stock (the “Supplemental Option”), the vesting terms of which are explained below. On December 30, 2013, Mr. Grenfell-Gardner received an award of 325,000 shares of restricted stock and an option to purchase 25,000 shares of the Company’s common stock in connection with his employment agreement.CEO Employment Agreement, Mr. Grenfell-Gardner is entitled to participatean annual base salary of $315,000, which was increased in certainaccordance with terms of the Company’s benefit programs onCEO Employment Agreement to $350,000 for the same terms and conditions generally provided by the Company to its executive employees.fiscal year ended 2014. Mr. Grenfell-Gardner is also eligible to receive an annual performance bonus for each calendar year during the term of his employment, which may be payable in either cash, stock options and/or restricted stock.stock, provided Mr. Grenfell-Gardner is employed on December 31 of such fiscal year. Mr. Grenfell-Gardner’s target annual performance bonus will be equal to 70% of his base salary then-in effect for the applicable fiscal year. In January 2013, the BoardThe amount of Directors approved a bonus of $39,174 for Mr. Grenfell-Gardner. In February 2014, the Board of Directors approved a bonus of $175,297 in relation to the period ended December 31, 2013. In March 2014, the Board of Directors approved a one-timeany such annual performance bonus of $75,000. All performance targets pursuant to such plan shall be determined by the Organization and Compensation Committee of the Board of Directors in their discretion, with reference to Mr. Grenfell-Gardner’s fulfillment of performance goals established by the Organization and Compensation Committee of our Board of Directors.

In connection with the entry into the CEO Employment Agreement, Mr. Grenfell-Gardner is also subjectreceived (i) 325,000 shares of restricted stock (the “Restricted Stock Award”), (ii) an option to certain restrictive covenants as set forth in his employment agreement, including confidentiality, non-solicitation and non-competition covenants. Mr. Grenfell-Gardner’s employment agreement further provides for payments upon certain types of employment termination events as further set forth in his employment agreement, as described below under “Potential Payments Upon Termination or Change-in-Control.”

The above-referenced stock option grants have an exercise price equal to the closing pricepurchase 975,000 shares of the Company’s common stock at an exercise price of $1.02 per share (the “Primary Option”) and (iii) a supplemental option to purchase 50,000 shares of the Company’s common stock (the “Supplemental Option”): options to purchase 25,000 shares of the Company’s common stock at an exercise price of $1.02 per share were issued on July 30, 2012, and are now fully vested; options to purchase 25,000 shares of the dateCompany’s common stock at an exercise price of grant,$2.89 were issued on December 30, 2013, and vest ratably on December 30 of each of 2013, 2014 and 2015. The Restricted Stock Award and the Primary Option are subject to and governed by the terms of the 2009 Plan and a restricted stock will become fully vested over a periodaward agreement and stock option award agreement, respectively, which agreements provide that one-third of three years as follows: (i) one-third shall vest on the first anniversary of the date of the grant; (ii) one-third shall vest on the second anniversary of the date of the grant; and (iii) one-third shall vest on the third anniversary of the date of the grant. One-half of the shares subject to the Supplemental Option shall become fully vested immediately upon their grant and the remaining one-half of the shares subject to sucheach award shall vest ratably on July 30 of each of 2013, 2014 and 2015. The Supplemental Option is subject to and governed by the first anniversaryterms of the effective date of Mr. Grenfell-Gardner’s employment.2009 Plan and stock option award agreements. In addition, any options or restricted stock that remainsremain unvested immediately prior to a change in control, as defined below, will immediately vest, provided that Mr. Grenfell-Gardner remains in continuous service with the Company through the consummation of thethat change in control.

Jenniffer Collins. Jenniffer Collins commenced servingEither party may terminate Mr. Grenfell-Gardner’s employment at any time, provided that Mr. Grenfell-Gardner shall provide 30 days’ written notice to the Company of any such termination.

Mr. Grenfell-Gardner is also subject to certain restrictive covenants as our Chief Financial Officerset forth in the CEO Employment Agreement, including confidentiality, non-solicitation and Corporate Secretary effective July 21, 2011. Under her employment agreement, Ms. Collins received an annual salary of $212,000 fornon-competition covenants. Mr. Grenfell-Gardner also agrees to assign certain intellectual property to the years ended December 31, 2013 and 2012. Ms. CollinsCompany. Mr. Grenfell-Gardner is also entitled to participate in certain of ourthe Company’s benefit programs on the same terms and conditions generally provided by usthe Company to ourits executive employees.

Chief Financial Officer.Jenniffer Collins joined IGI as our Chief Financial Officer pursuant to an employment agreement, effective July 21, 2011 (the “CFO Employment Agreement”). Under the CFO Employment Agreement, Ms. Collins receives an annual base salary of $210,000, which was increased in accordance with terms of the CFO Employment Agreement to $218,463 for the fiscal year ended 2014. Ms. Collins is also eligible to receive an annual performance bonus for each calendar year during the term of her employment, which may be payable in either cash, stock options and/or restricted stock.stock, provided Ms. Collins is employed on December 31 of such fiscal year. Ms. Collins’ target annual performance bonus will be equal to 30% of her base salary then-in effect for the applicable fiscal year. AllThe amount of any such annual performance targets pursuant to such planbonus shall be determined by ourthe Organization and Compensation Committee. In January 2013,Committee of the Board of Directors approved a bonusin their discretion, with reference to Ms. Collins’ fulfillment of $20,177 in cash and a stock award with a fair value of $12,206 in relation to the period ended December 31, 2012. In February 2014,performance goals established by the Board of Directors approved a bonus of $49,075 foror any committee with respect to the applicable fiscal year.

In connection with entering into the CFO Employment Agreement, Ms. Collins received an option to purchase 225,000 shares of the Company’s common stock at an exercise price of $1.04 per share. The option is subject to and governed by the terms of the 2009 Plan and a stock option award agreement, and is now fully vested. In addition, any options or restricted stock that remain unvested immediately prior to a change in relationcontrol, as defined below, will immediately vest, provided that Ms. Collins remains in continuous service with the Company through the consummation of that change in control.

Either party may terminate Ms. Collins’ employment at any time, provided that Ms. Collins shall provide 30 days’ written notice to the period ended December 31, 2013.Company of any such termination.

Ms. Collins is also subject to certain restrictive covenants as set forth in her employment agreement,the CFO Employment Agreement, including confidentiality, non-solicitation and non-competition. Further,non-competition covenants. Ms. Collins also agrees to assign certain intellectual property to the Company. Ms. Collins is also entitled to paymentparticipate in certain of six monthsthe Company’s benefit programs on the same terms and conditions generally provided by the Company to its executive employees.

Outstanding Equity Awards at 2014 Fiscal Year-End

The following table shows grants of severance plusstock options and grants of unvested stock awards outstanding on the last day of the fiscal year ended December 31, 2014to each of the executive officers named in the Summary Compensation Table.

Option Exercises and Stock Vested in 2014

The following table shows information regarding exercises of options to purchase our common stock and vesting of stock awards held by each executive officer named in the Summary Compensation Table during the fiscal year ended December 31, 2014.

No executive officer exercised an option to purchase our common stock during the fiscal year ended December 31, 2014.

Pension Benefits

We do not have any qualified or non-qualified defined benefit plans.

Nonqualified Deferred Compensation

We do not have any nonqualified defined contribution plans or other deferred compensation plan.

Potential Payments upon Termination or Change in Control

Set forth below is a pro-rata portiondescription of her bonus, if she is terminated without cause.the potential payments we would need to make upon termination of Mr. Grenfell-Gardner’s and Ms. Collins’sCollins’ employment agreement further provides for paymentsor upon certain other types of employment termination events, including a change in control as further set forth in herof the Company. Any such payments are conditioned upon such executive’s execution and delivery to the Company, within 60 days following cessation of employment, agreement, as described below under “of a general release of claims.

Potential Payments Upon Termination or Change-in-Control.by us without cause.”

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Charles E. Moore. Charles E. Moore ceased to be employedIf the executive’s employment is terminated by the Company as Chief Executive Officer and resigned as a member of the Company’s Board of Directors, effective July 30, 2012. In connection with Mr. Moore’s departure from the Company, we entered into a Separation of Employment Agreement and General Release (the “Separation Agreement”) dated August 14, 2012 with Mr. Moore, consistent with the terms of Mr. Moore’s employment agreement. The Separation Agreement provided that we pay Mr. Moore $138,680 as a separation payment, with such amount to be paid ratably over a six-month period on each regular payroll payment date during such period, which amount has been paid in full.

Also, in the Separation Agreement, Mr. Moore agreed to provide us with a general release, and Mr. Moore agreed to certain restrictive covenants, and reconfirmed his agreement to the confidentiality, non-competition and non-solicitation covenants set forth in his employment agreement with us, after the Separation Date.

Potential Payments Upon Termination or Change-in-Control

Our employment agreements with Mr. Grenfell-Gardner and Ms. Collins require us to make certain payments to them in the event of a termination of employment or change-in-control (as defined below). In the event either are terminated without “cause”cause (as defined below), Mr. Grenfell-Gardner and Ms. Collinswe are each entitledrequired to pay (i) their unpaid base salary through the effective date of termination and any reimbursedreimbursable business expensesexpenses; (ii) an amount per month equal to one-twelfth of their then-adjustedthe executive’s base salary as then in effect for a period of six months following termination of employment; and (iii) an amount equal to a pro-rata portion of theirthe executive’s annual performance bonus that would otherwise have been payable to the executive for the year in which the termination occurs.occurs, prorated as of the date of termination. Further, to the extent then unvested, upon such termination, a pro-rata portion of Mr. Grenfell-Gardner’s and Ms. Collins’ respectivethe executive’s options and restricted stock will become vestedvested. However, any such payment obligations shall immediately terminate upon a judicial determination that the executive has breached certain confidentiality, non-solicitation, non-competition and/or conflict of interest provisions under their respective employment agreements.

Termination for any other reason.If the executive’s employment is terminated by the Company other than without cause (as defined below), including, but limited to, termination without cause.for cause, as a result of the executive’s death or disability, or as a result of the executive’s resignation, we are required to pay their unpaid base salary through the effective date of termination.

Payments upon a Change in Control.The employment agreements of Mr. Grenfell-Gardner and Ms. Collins further provide that, in the event of a “change in control,” provided they remain in continuous service with the Company through the consummation of thesuch change in control, all unvested options and restricted stock awarded to them pursuant to their respective employment agreements will immediately vest.

“Cause,” for purposes of each of the employment agreements, includes (i) commission of a willful and material act of dishonesty in the course of the executive’s duties under their respective employment agreements, (ii) conviction by a court of competent jurisdiction of a crime constituting a felony or conviction in respect of any act involving fraud, dishonesty or moral turpitude, (iii) the executive’s performance under the influence of controlled substances, or continued habitual intoxication, during working hours, after the Company shall have provided written notice to the executive and given the executive 30 days within which to commence rehabilitation with respect thereto, and the executive shall have failed to commence such rehabilitation or continued to perform under the influence after such rehabilitation, (iv) frequent or extended, and unjustifiable (not as a result of incapacity or disability) absenteeism, which shall not have been cured within 30 days after the Company’s written notice of breach and its intention to terminate the executive’s employment in accordance with the provisions of his or her employment agreement, (v) the executive’s personal, willful and continuing misconduct or refusal to perform his or her duties and responsibilities, or to carry out directives of the Board of Directors, which, if capable of being cured, shall not have been cured within 60 days after the Company’s written notice of breach and its intention to terminate the executive’s employment in accordance with the provision of his or her employment agreement or (vi) material non-compliance with the terms of thishis or her respective employment agreement.agreement, including, but not limited to, any breach of certain confidentiality, non-solicitation, non-competition and conflict of interest provisions thereunder.

A “change in control,” for purposes of each of the employment agreements, includes (a) any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (other than (i) an individual or entity holding securities of the acquisitionCompany as of 60%the date hereof which represent 3% or more of the outstanding voting power of the all securities on matters to be generally voted upon by the Company's stockholders, (ii) Jane Hager, Edward Hager, Steve Morris, Frank Gerardi or any of their respective affiliates, any entity of which any of the foregoing are trustees, or trusts established for their benefit, (iii) the Company, any trustee or other fiduciary holding securities under an employee benefit plan of the Company, (iv) Signet Healthcare Partners, its affiliates or any of its affiliated funds, or (v) any corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportion as their ownership of stock of the Company) is or becomes the owner, directly or indirectly, of outstanding securities of the Company by a person, (ii)representing 60% or more of the combined voting power of the Company's then outstanding securities; (b) the consummation of a merger or consolidation of the Company with any other corporation, other than (i) a merger or (iii)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) more than 40% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation or (ii) a merger or consolidation effected to implement a re-capitalization of the Company (or similar transaction) or a reincorporation of the Company into another jurisdiction; or (c) a sale of all or substantially all of the assets of the Company, in each case subject to certain exceptions set forth in the employment agreements.Company.

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Outstanding Equity Awards at 2013 Fiscal Year-End

The following table sets forth certain information concerning outstanding equity awards as of December 31, 2013.

Director Compensation

Director Options. In September 1999,2009, our Board of Directors unanimously adopted the 1999 Director Stock Option Plan, which we refer to as the 1999 Director Plan. The current 1999 Director Plan, as amended, provides that:

·

on January 2 of each year, eacha non-employee director is granted a stock option to purchase 15,000 shares of our common stock;compensation program, which provides as follows:

·

on January 2 of each year, each of the Chairperson of the Board, the Audit Committee and the Organization and Compensation Committee is granted additional stock options to purchase 20,000, 20,000 and 15,000 shares of our common stock, respectively;

·

In addition, at the time of his or her election,appointment, each newly elected director will receive a stock option grantshall be granted options to purchase 30,000an additional 15,000 shares of our common stock.stock under our 2009 Plan.

All of such options will beare granted at an exercise price equal to the closing price of our common stock on the NYSE MKT on the date of grant. All options granted under the 1999 Director Plangrant and vest fully vested on the first anniversary of the date of grant.

Director Fees. In 2009, our Board of Directors unanimously adopted a non-employee director compensation program, which provides for (i) the equity grants described above and (ii) the payment of an annual cash retainer of $25,000, payable on a quarterly basis.

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The following table shows the total compensation paid or accrued during the fiscal year ended December 31, 2013 to2014to each of our non-employee directors. Directors who are employed by us are not compensated for their service on our Board of Directors.

^{_________________________________}

⁽¹⁾

The amounts reflected in this column represent Mr. Grenfell-Gardner, who served as our President and Chief Executive Officer during the fair value of the awards on the date of grant, as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation (“FASB ASC Topic 718”).

⁽²⁾

As ofyear ended December 31, 2013,2014, and continues to serve in that capacity, does not receive additional compensation for his service as a director and, therefore, is not included in the aggregate amount of shares of common stock that can be acquired by each director pursuantDirector Compensation table below. All compensation paid to outstanding option awards are as follows: James C. Gale, 105,000 shares; Narendra N. Borkar, 135,000 shares; Michael Hemric, 100,000 shares; Joyce Erony, 95,000 sharesMr. Grenfell-Gardner is reported in the Summary Compensation Table included under “Executive Officer and Bhaskar Chaudhuri, 95,000 shares.Director Compensation.”

⁽³⁾EQUITY COMPENSATION PLAN INFORMATION

We issued the options in this column at an exercise price equal to the closing price of our common stock on the date of the grant. We valued these options using a Black-Scholes model. In the model, we used an expected life of 3.2 years to value the ten-year options that we issued. We used an interest rate equal to the yield on treasury bonds that have approximately 3.2 years remaining until maturity and uses the volatility of our stock price over a period that is approximately 3.2 years prior to the grant date.

⁽⁴⁾

Ms. Erony and Mr. Gale voluntarily deferred payment of the cash compensation otherwise due to them on account of director fees until such time as the Company returns to profitability.

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Securities Authorized For Issuance Under Equity Compensation Plans

The following table provides certain aggregate information with respect to all of the Company’s equity compensation plans in effect as of December 31, 2013.2014.

^{_________________________________}

⁽¹⁾

Includes information with respect to the 1999 Stock Incentive Plan, as amended, the 1999 Director Plan and the 2009 Equity Incentive Plan, as amended, or the 2009 Plan.

⁽²⁾

Includes information with respect to the 1999 Director Plan and the 2009 Plan. As of December 31, 2013, we had 522,984 shares available for issuance pursuant to the 1999 Director Plan and 799,836 shares available for issuance pursuant to the 2009 Plan.

REPORT OF THE AUDIT COMMITTEE

The Audit Committee of the Board of Directors, has:which consists entirely of directors who meet the independence and experience requirements of the NYSE MKT, has furnished the following report:

·The Audit Committee assists the Board of Directors in overseeing and monitoring the integrity of our financial reporting process, compliance with legal and regulatory requirements and the quality of internal and external audit processes. This committee’s role and responsibilities are set forth in our charter adopted by the Board of Directors, which is available on our website atwww.igilabs.com. This committee reviews and reassesses our charter annually and recommends any changes to the Board of Directors for approval. The Audit Committee is responsible for overseeing our overall financial reporting process, and for the appointment, compensation, retention, and oversight of the work of EisnerAmper LLP. In fulfilling its responsibilities for the financial statements for fiscal year December 31, 2014, the Audit Committee took the following actions:

reviewed

·

discussed with our independent auditors, EisnerAmper LLP, matters required to be discussed by Auditing Standard No. 16 –Communications with Audit Committees; and

·

received the

In relianceBased on the Audit Committee’s review of the audited financial statements and discussions referred to above,with management and EisnerAmper LLP, the Audit Committee recommended to ourthe Board of Directors that ourthe audited consolidated financial statements be included in our Annual Report on Form 10-K for filing with the SEC for the year ended December 31, 2013.

Audit Committee

Bhaskar Chaudhuri (Chairman)

Michael Hemric

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PROPOSAL NO. 2 – APPROVAL OF THE AMENDMENT OF

OUR 2009 EQUITY INCENTIVE PLAN TO INCREASE THE NUMBER OF SHARES

OF COMMON STOCK THAT MAY BE ISSUED THEREUNDER BY 1,000,000 SHARES

Background

On March 25, 2014, our Board of Directors unanimously adopted a resolution approving, subject to approval by our shareholders, an amendment of our 2009 Equity Incentive Plan, or the 2009 Plan, to increase the number of shares of common stock available for grant under the 2009 Plan by adding 1,000,000 shares. The 2009 Plan was previously amended and restated by the Board on April 12, 2010, and approved by our stockholders at the 2010 annual meeting to increase the number of shares issuance thereunder by 2,000,000 shares, to a total aggregate of 4,000,000 shares of common stock.

The Board of Directors believes that the proposed amendment of the 2009 Plan is in the best interests of, and will provide long-term advantages to, us and our stockholders and recommends approval by our stockholders. Our Board of Directors believes that the number of shares of common stock currently available for issuance under the 2009 Plan is insufficient in view of our compensation structure and strategy. The Board of Directors has concluded that our ability to attract, retain and motivate top quality employees is material to our success and would be enhanced by our continued ability to make grants under the 2009 Plan. The Board of Directors has directed that the proposal to approve the amendment and restatement of the 2009 Plan be submitted to the stockholders for their approval at the Annual Meeting.

As of March 31, 2014: (i) 757,836 shares of common stock remained available for future awards under the 2009 Plan; (ii) 216,667 unvested restricted share awards were outstanding under the 2009 Plan; and (iii) 1,916,500 shares of common stock were subject to outstanding options under the 2009 Plan.

As stated above, if Proposal 2 is approved, 1,000,000 additional shares would be added to the shares available for award under the 2009 Plan. As a result, these additional shares, together with the shares that currently remain available for future awards under the 2009 Plan plus any shares of common stock that are restored to availability under the 2009 Plan upon expiration, forfeiture or termination of options or other awards, would be available for any form of award under the 2009 Plan.

If an option or other award granted under the 2009 Plan expires, is forfeited or otherwise terminates, the shares of common stock subject to any portion of the award that expires, is forfeited or that otherwise terminates, as the case may be, will again become available for the issuance under the 2009 Plan.

We intend to register the additional shares that would be available for awards under the 2009 Plan on Form S-8 under the Securities Act of 1933 as soon as practicable after receiving shareholder approval of the increase.

The following is a brief summary of the 2009 Plan, as amended by this Proposal, and is qualified in all respects by the specific language of the full text of the amended and restated 2009 Plan, a copy of which is attached asAppendix A to the Proxy Statement.

Summary of the 2009 Plan

Shares Available and Award Limitations. Subject to adjustment in certain circumstances as discussed below, the 2009 Plan authorizes up to 5,000,000 shares of our common stock for issuance pursuant to the terms of the 2009 Plan. The maximum number of shares that may be subject to awards made to any individual in any single calendar year under the 2009 Plan is 1,000,000 shares.

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If and to the extent awards granted under the 2009 Plan terminate, expire, cancel, or are forfeited without being exercised and/or delivered, the shares subject to such awards will again be available for grant under the 2009 Plan. Additionally, to the extent any shares subject to an award are withheld in settlement of any exercise price and/or any tax withholding obligation associated with that award, those shares will again be available for grant under the 2009 Plan.

In the event of any recapitalization, reorganization, merger, spin-off, stock split or combination, stock dividend or other similar event or transaction, substitutions or adjustments will be made by the Board of Directors to: (i) the aggregate number, class and/or issuer of the securities reserved for issuance under the 2009 Plan; (ii) the number, class and/or issuer of securities subject to outstanding awards; and (iii) the exercise price of outstanding options or stock appreciation rights, in each case in a manner that reflects equitably the effects of such event or transaction.

Administration.The 2009 Plan is administered and interpreted by the Board of Directors or by one or more committees of the Board of Directors (each a “Committee”). The authority of the Board of Directors and any Committee appointed by the Board of Directors are co-extensive. Therefore, for the remainder of this discussion, references to the Committee will be deemed to include the Board of Directors.

The Committee designated by the Board of Directors has authority to grant awards under the 2009 Plan and determine the terms of such awards, including the persons to whom awards are to be granted, the type and number of awards to be granted and the number of shares of our common stock to be covered by each award. The Committeedesignated by the Board of Directors also specifies the time(s) and conditions upon which awards will be exercisable or settled. The Committee designated by the Board of Directors is also empowered to interpret the 2009 Plan and any award agreement and to correct any defect, supply any omission and to reconcile any inconsistency contained in the Plan or any award agreement.

Awards.Awards granted under the 2009 Plan may consist of incentive stock options or non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units and performance awards. Each award is subject to the terms and conditions set forth in the 2009 Plan and to any other terms and conditions specified by the Committee designated by the Board of Directors and memorialized in a written award agreement.

Eligibility.Employees, directors, consultants and other service providers of ours and our affiliates are eligible to participate in the 2009 Plan, provided, however, that only our or our subsidiaries’ employees are eligible to receive incentive stock options. As of March 31, 2014, approximately 62 employees, including our executive officers, would be eligible to participate in the 2009 Plan.

Stock Options

General.The Committee designated by the Board of Directors may grant options qualifying as incentive stock options (“ISOs”) within the meaning of Section 422 of the Code and/or non-qualified stock options (“NQSOs”).

Term, Purchase Price, Vesting and Method of Exercise of Options.The exercise price of any stock option granted under the 2009 Plan will be the fair market value of such stock on the date the option is granted, which as long as our common stock is traded on a national securities exchange, will be the closing price of our common stock on such exchange.

The Committee designated by the Board of Directors may determine the option exercise period for each option; provided, however, that the exercise period may not exceed ten years from the date of grant. Vesting for each option will also be determined by the Committee.

Generally, payment of the option price will be made in cash, or with the Committee’s consent, in shares of our common stock having a fair market value on the date of exercise equal to the option price, or by such other means as the Committee may permit. The participant must pay the option price and the amount of withholding tax due, if any, at the time of exercise.

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Stock Appreciation Rights.The Committee designated by the Board of Directors is authorized to grant stock appreciation rights (“SARs”) under the 2009 Plan. Upon exercise of a SAR, the participant is entitled to receive an amount equal to the difference between the fair market value of our common stock underlying the SAR on the date of exercise and the fair market value of our common stock underlying the SAR on the date of grant. Such amount may be paid in cash or shares of our common stock, as determined by the Committee.

Effects of Termination of Service with us.Generally, unless provided otherwise in the award agreement, the right to exercise any option or SAR terminates 90 days following termination of the participant’s relationship with us for reasons other than death, disability or termination for “cause” as defined in the 2009 Plan. If the participant’s relationship with us terminates due to death or disability, unless provided otherwise in the award agreement, the right to exercise an option or SAR will terminate the earlier of one year following such termination or the original expiration date. If the participant’s relationship with us is terminated for “cause”, any option or SAR not already exercised will automatically be forfeited as of the date of such termination.

Restricted Stock Awards.The Committee designated by the Board of Directors may issue restricted shares of our common stock under the 2009 Plan. A restricted stock award is an award of shares that will vest based on the occurrence of a condition specified by the Committee (such as the completion of a period of service or attainment of a performance goal). If a participant’s employment terminates before the vesting condition is fulfilled, the shares will be forfeited. While the shares remain unvested, a participant may not sell, assign, transfer, pledge or otherwise dispose of the shares. Unless otherwise determined by the Committee, an award of restricted stock entitles the participant to all of the rights of a stockholder of ours, including the right to vote the shares and the right to receive any dividends thereon.

Restricted Stock Units.The Committee designated by the Board of Directors may issue restricted stock units (“RSUs”) under the 2009 Plan. A RSU is a contractual promise to issue shares (or pay the value of shares) at a specified future date, subject to fulfillment of vesting conditions specified by the Committee. A RSU award carries no voting or dividend rights or other rights associated with stock ownership. A RSU award may be settled in shares of our common stock, cash, or in any combination of common stock and/or cash, as determined by the Committee.

Performance Awards.The Committee designated by the Board of Directors may grant performance awards under the 2009 Plan, which may be denominated as a number of shares of our common stock or a specified number of other awards (or a combination of both). Generally, performance awards require satisfaction of pre-established performance goals, consisting of one or more business criteria and a targeted performance level with respect to such criteria, as a condition of awards being granted, settled or becoming vested under the 2009 Plan, or as a condition to accelerating the timing of such events.

The performance criteria associated with that award will be based on one or more of the following: (1) the attainment of certain target levels of, or a specified percentage increase in, revenues, income before taxes and extraordinary items, net income, operating income, earnings before income tax, earnings before interest, taxes, depreciation and amortization, earnings per share, after-tax or pre-tax profits, operational cash flow, return on capital employed or return on invested capital, after-tax or pre-tax return on stockholders’ equity, the price of our common stock or a combination of the foregoing; (2) the achievement of a certain level of, reduction of, or other specified objectives with regard to limiting the level of increase in, our bank debt or other public or private debt or financial obligations; (3) the attainment of a certain level of, reduction of, or other specified objectives with regard to limiting the level in or increase in all or a portion of controllable expenses or costs or other expenses or costs; and/or (4) such other business criteria specified by the Committee, provided that such criteria does not cause a performance award intended to constitute “qualified performance-based compensation” under Section 162(m) of the Code to fail to so qualify. Performance goals may be established on a Company-wide basis, or with respect to one or more business units, divisions, affiliates or products. In addition, performance goals may be established in either absolute terms or relative to the performance of one or more comparable companies or an index covering multiple companies.

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The Committee may provide, at the time a performance goal is established, that adjustments will be made to the applicable performance goal to take into account, in the manner specified by the Committee, the impact of one or more of the following: (1) gain or loss from all or certain claims and/or litigation and insurance recoveries, (2) the impairment of tangible or intangible assets, (3) stock-based compensation expense, (4) extraordinary, unusual or infrequently occurring events reported in our public filings, (5) restructuring activities reported in our public filings, (6) investments, dispositions or acquisitions, (7) gain or loss from the disposal of certain assets, (8) gain or loss from the early extinguishment, redemption, or repurchase of debt, (9) changes in accounting principles that become effective during the performance period, or (10) such other items specified by the Committee, provided that such adjustment does not cause a performance award intended to constitute qualified performance-based compensation under Section 162(m) of the Code to cease to so qualify. Each of the adjustments described in this paragraph may relate to the whole Company or to any subsidiary, division or other operational unit of the Company, as determined by the Committee at the time the performance goals are established. The adjustments are to be determined in accordance with generally accepted accounting principles and standards, unless another objective method of measurement is designated by the Committee. Finally, adjustments will be made as necessary to any business criteria related to our stock to reflect changes in corporate capitalization, such as stock splits and reorganizations.

The adoption, disclosure and approval of the foregoing performance criteria are intended to enable the issuance of awards that will constitute “qualified performance-based compensation” exempt from the deduction limitations of Section 162(m) of the Code.

Amendment and Termination of the 2009 Plan.The Board of Directors may amend, alter or discontinue the 2009 Plan at any time; provided however, no amendment that would impair the rights of a participant with respect to their award may be made without that participant’s consent, and any amendment that increases the aggregate number of shares of our common stock that may be issued under the 2009 Plan or modifies the requirements as to eligibility for participation will be subject to approval by our stockholders.

The 2009 Plan will not expire on any particular date. The Committee may continue to grant awards so long as shares remain available, provided that no new ISOs will be granted after the 10^th anniversary of the date the 2009 Plan was approved by our stockholders (or, if the stockholders approve an amendment that increases the number of shares subject to the 2009 Plan, the 10th anniversary of the date of such approval).

Change in Control. In the event of our change in control, the Committee has discretion to, among other things, accelerate the vesting of outstanding awards, cash out outstanding awards or exchange outstanding awards for similar awards of a successor company. Our “change in control” will be deemed to have taken place upon:

·

the acquisition by any person (with certain limited exceptions) of direct or indirect ownership of securities representing 60% or more of the combined voting power of our then outstanding securities;

·

our merger or consolidation resulting in our stockholders immediately prior to such event not owning 40% of the combined voting power of the voting securities of the resulting entity immediately following such event;

·

the sale of substantially all our assets; or our liquidation or dissolution.

Federal Income Tax Consequences of Awards Granted under the 2009 Plan

Set forth below is a general description of the federal income tax consequences relating to awards granted under the 2009 Plan. Participants are urged to consult with their personal tax advisors concerning the application of the principles discussed below to their own situations and the application of state and local tax laws.

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NQSOs.There are no federal income tax consequences to participants or to us upon the grant of a NQSO. Upon the exercise of a NQSO, participants will recognize ordinary income in an amount equal to the excess of the fair market value of the shares at the time of exercise over the exercise price of the NQSO and we generally will be entitled to a corresponding federal income tax deduction at that time. Shares issued upon the exercise of a NQSO will have a tax basis equal to their fair market value on the date of exercise, and the holding period of the shares will commence on that date for purposes of determining whether a subsequent disposition of the shares will result in long-term or short-term capital gain or loss.

ISOs.Participants will not be subject to federal income taxation upon the grant or exercise of an ISO and we will not be entitled to a federal income tax deduction by reason of such grant or exercise. However, the amount by which the fair market value of the shares at the time of exercise exceeds the option exercise price is an item of tax preference subject to the alternative minimum tax. A sale of shares acquired by exercise of an ISO that does not occur within one year after the exercise or within two years after the grant of the ISO generally will result in the recognition of long-term capital gain or loss equal to the difference between the amount realized on the sale and the option exercise price and we will not be entitled to any tax deduction in connection therewith.

If such sale occurs within one year from the date of exercise of the ISO or within two years from the date of grant (a “disqualifying disposition”), the participant generally will recognize ordinary income equal to the lesser of the excess of the fair market value of the shares on the date of exercise over the exercise price, or the excess of the amount realized on the sale of the shares over the exercise price. We generally will be entitled to a tax deduction on a disqualifying disposition corresponding to the ordinary compensation income recognized by the participant.

SARs.The participant will not recognize any income upon the grant of a SAR. Upon the exercise of a SAR, the participant will recognize ordinary compensation income equal to the value of the shares of our common stock and/or cash received upon such exercise, and we will be entitled to a congruent deduction. Shares received in connection with the exercise of a SAR will have a tax basis equal to their fair market value on the date of transfer, and the holding period of the shares will commence on that date for purposes of determining whether a subsequent disposition of the shares will result in long-term or short-term capital gain or loss.

Restricted Stock.A participant normally will not recognize taxable income upon the award of restricted stock, and we will not be entitled to a deduction, until such stock is transferable by the participant or is no longer subject to a substantial risk of forfeiture for federal tax purposes, whichever occurs earlier. When the shares of our common stock subject to the award are either transferable or are no longer subject to a substantial risk of forfeiture, the participant will recognize ordinary compensation income in an amount equal to the difference between the fair market value of the shares of our common stock at that time and the amount paid by the participant for the shares, if any. We will be entitled to a deduction equal to the income recognized by the participant.

A participant may, however, elect to recognize ordinary income in the year the restricted stock is awarded in an amount equal to the difference between the fair market value of the shares of common stock at that time, determined without regard to any restrictions, and the amount paid by the participant for the shares, if any. In this event, we will be entitled to a deduction equal to the amount recognized as compensation by the participant in the same year. In addition, in this event, the participant will not be required to recognize any taxable income upon vesting of the shares. If, after making the election, any shares subject to the award are forfeited, the participant will not be entitled to any tax deduction or refund with respect to taxes previously paid.

In either case, the tax basis of shares subject to a restricted stock award will be equal to their fair market value on the date the participant recognizes ordinary income with respect to the award, and the holding period of the shares will commence on that date for purposes of determining whether a subsequent disposition of the shares will result in long-term or short-term capital gain or loss.

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RSUs. A participant will not recognize taxable income upon the grant of a RSU. At the time shares and/or cash are paid to a participant in settlement of the RSU, the participant will recognize ordinary income equal to the value of the shares and/or cash and we will be entitled to a congruent deduction. Shares issued in settlement of a RSU award will have a tax basis equal to their fair market value on the date of vesting, and the holding period of those shares will commence on that date for purposes of determining whether a subsequent disposition of the shares will result in long-term or short-term capital gain or loss.

Performance Awards.If a performance award is settled by the issuance of unrestricted shares of our common stock, the participant receiving the shares will recognize ordinary income equal to the value of the shares at the time of issuance and we will be entitled to a congruent deduction. Those shares will then have a tax basis equal to their fair market value on the date of issuance, and the holding period of those shares will commence on that date for purposes of determining whether a subsequent disposition of the shares will result in long-term or short-term capital gain or loss.

If a performance award is settled by the issuance of another type of award under the 2009 Plan, the tax consequences of that other award will be the same as described above with respect to the relevant type of award.

Section 162(m).Section 162(m) of the Code limits the federal income tax deductions a publicly held company can claim for compensation in excess of $1,000,000 paid to certain executive officers (generally, the officers who are “named executive officers” in the summary compensation table in the issuer’s proxy statement, excluding the issuer’s principal financial officer). “Qualified performance-based compensation” is not counted against the $1,000,000 deductibility limit. Under the 2009 Plan, options or SARs granted with an exercise price at least equal to 100% of the fair market value of the underlying shares at the date of grant may satisfy the requirements for treatment as “qualified performance-based compensation.” In addition, awards that are conditioned upon achievement of certain performance goals may satisfy the requirements for treatment as “qualified performance-based compensation.” A number of other requirements must be met, however, in order for those awards to so qualify. Accordingly, there can be no assurance that awards under the 2009 Plan will be fully deductible under all circumstances.

New Plan Benefits

Awards are granted under the 2009 Plan in the discretion of the Committee designated by the Board. Accordingly, it is not possible to determine the number, name or positions of persons who will benefit from the amendment and restatement of the 2009 Plan, if it is approved by stockholders, or the terms of any such benefits.

Vote Required

The affirmative vote of a majority of the votes present or represented by proxy and entitled to vote at the annual meeting is required to approve the amendment to the 2009 Plan.

Board Recommendation

OUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE APPROVAL OF THE AMENDMENT OF OUR 2009 PLAN.

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PROPOSAL NO. 3 – RATIFICATION OF THE APPOINTMENT OF

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee has selected EisnerAmper LLP to serve as our independent auditors for the fiscal year ending December 31, 2014. Representatives from EisnerAmper LLP are expected to attend the Annual Meeting and will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.

Although stockholder ratification of the appointment of EisnerAmper LLP as our independent registered public accounting firm is not required by our bylaws or otherwise, our Board of Directors has decided to afford our stockholders the opportunity to express their opinions on the matter of our independent registered public accounting firm. Even if the selection is ratified, the Audit Committee in its discretion may select a different independent registered public accounting firm at any time if it determines that such a change would be in our best interests and those of our stockholders. If our stockholders do not ratify the appointment, the Audit Committee will take that fact into consideration, together with such other information as it deems relevant, in determining its next selection of an independent registered public accounting firm.

Fees Paid to Independent Auditors

The following table sets forth the aggregate fees paid by us for the audit and other services for the fiscal years 2013 and 2012 to our independent auditors:

^{_________________________________}

⁽¹⁾

These are fees for professional services rendered for the audit of our 2013 and 2012 financial statements and review of financial statements included in our quarterly reports on Form 10-Q, and services that are normally provided in connection with statutory and regulatory filings or engagements, and professional services associated with our filing of registration statements on Form S-3 and Form S-8.

Representatives of EisnerAmper LLP attended all meetings of the Audit Committee in 2013. The Audit Committee pre-approves and reviews all audit services performed by our independent auditors as well as the fees charged by our independent auditors for such services. In its pre-approval and review of non-audit service fees, the Audit Committee considers, among other things, the possible effect of the performance of such services on the auditors’ independence. EisnerAmper LLP did not perform any non-audit services for us during fiscal years 2013 or 2012.

Vote Required

The affirmative vote of a majority of the shares of common stock cast for this proposal is required to ratify the selection of EisnerAmper LLP as our independent registered public accounting firm for the fiscal year ended December 31, 2014.2014 for filing with the SEC. As Mr. Celentano, who is currently a member of our Audit Committee, was not yet a member of the Audit Committee at the time this report was issued, his signature is not included below.

29SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our directors, executive officers and beneficial owners of more than 10% of our common stock to file with the SEC initial reports of ownership and reports of changes in the ownership of our common stock and other equity securities. Such persons are required to furnish us copies of all Section 16(a) filings.

Board Recommendation

Our records reflect that all reports which were required to be filed pursuant to Section 16(a) of the Exchange Act were filed on a timely basis.

OUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF EISNERAMPER LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING DECEMBER 31, 2014.