UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Tableexecution for Incyte. We delivered strong revenue growth across our portfolio of Contents
Incyte Corporation
1801 Augustine Cut-Off
Wilmington, Delaware 19803
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Wednesday, May 26, 2021June 15, 2022
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Record Date: | | April 18, 2022—Stockholders of record as of the close of business on | |
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By Order of the Board of Directors | | ||
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| Maria E. Pasquale | | |
| Secretary | ||
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| | | Proxy Statement 2022|i | |
| Time and Date: | | | 1:00 PM EDT, June 15, 2022 | | | | | |
| Place: | | | 1815 Augustine Cut-Off* Wilmington, DE 19803 | | | |||
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| | April 18, 2022 | | | |||||
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Please follow the instructions contained in this Proxy Statement | | | ||||||
| Mail Date: | | | The Proxy Availability Notice will be mailed to stockholders on or about April |
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PROPOSAL | | | |||||
| | | BOARD’S VOTING RECOMMENDATION | | |||
1 | | | Election of Directors | | | FOR each Nominee | |
2 | | | Advisory Vote to Approve Executive Compensation | ||||
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Ratification of Independent Registered Public Accounting Firm | |||||||
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You may vote using any of the following methods:
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INTERNET | | | | | IN PERSON | | |||||
Stockholders of record may vote online at www.envisionreports.com/INCY | | | Stockholders of record may call toll-free 1-800-652—VOTE (8683) | | | Follow the instructions in your proxy materials. | | | You may obtain directions to the Annual Meeting by contacting our | |
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2020
We reported total productProduct and royalty revenues grew 17% year-over-year to $2.9 billion, driven by growth across all products commercialized by Incyte as well as Incyte products commercialized by our partners. During the year, we achieved 5 regulatory approvals across the U.S., Europe and Japan. These launches are currently underway and are expected to contribute more meaningfully to revenue going forward.
Net sales ofJakafi
New productindications in myelofibrosis, polycythemia vera and graft-versus-host disease (GVHD). In the fourth quarter, Jakafi received approval of its fourth indication for the treatment of patients with steroid-refractory chronic GVHD.
Wewe receive royalties on Jakavi®Jakavi
| 2|Proxy Statement 2022 | | | |
| Performance Highlights | |
$569 million
We operate in two therapeutic areas that are defined by the indications of our approved medicines and the diseases for which our clinical candidates are being developed. The first therapeutic area is Hematology/
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Proxy Statement | |
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| Performance Highlights | |
Oncology, which is comprised of Myeloproliferative Neoplasms (MPNs)2021 and Graft-Versus-Host Disease (GVHD), as well as solid tumorsYTD Regulatory and hematologic malignancies. Our second therapeutic area is InflammationClinical Achievements
We are also eligible to receive milestones and royalties on molecules discovered by us and licensed to third parties.
Weyear-to-date, we achieved numerous important milestones in 2020 and during 2021 to date, and thesemilestones. These are summarized in the graphic below and described in more detail thereafter.
AD = atopic dermatitis; GVHD = graft-versus-host disease; MF = myelofibrosis; DLBCL = diffuse large B-cell lymphoma; CCA = cholangiocarcinoma; BTC = biliary tract cancer; SCACcarcinoma; AAD = squamous cell anal carcinoma; NHLAmerican Academy of Dermatology; MAA = non-Hodgkin lymphoma;Marketing Authorization Application; EMA = European Medicines Agency; NSCLC = non-small cell lung cancer; AD = atopic dermatitis; IAI = inflammationcancer.
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The REACH3 Phase 3 trial of ruxolitinib in patients with steroid-refractory chronic GVHD met its primary endpoint of superior overall response rate at month 6 and achieved statistically significant and clinically meaningful improvements in both key secondary endpoints, the modified LeeSeptember 2021. There are approximately 14,000 patients living with chronic GVHD symptom scale and failure free survival. The safety profilein the U.S., of ruxolitinib was consistent with previously reported studies of ruxolitinib in GVHD.
The success of the REACH3 trial represents the largest randomized pivotal trial with positive results in this patient population, as was the success of the randomized REACH2 trial in patients with acute GVHD, as described last year. The sNDA seeking FDA approval of ruxolitinib in patients with steroid-refractory chronic GVHD is now under Priority Review at the FDA with a decision expected in June 2021.
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We are alsoOur Leadership In MPNs Beyond Ruxolitinib (LIMBER) program focuses on developing multiple programs beyond ruxolitinib monotherapynew therapies to improve and expand upon available therapeutic options for patients living with myeloproliferative neoplasms (MPNs) as part of our Leadership In MPNs BEyond Ruxolitinib (LIMBER) initiative. We are evaluating combinations of ruxolitinib with other therapeutic modalities, as well as developing a once-a-day formulation of ruxolitinib for potential use as monotherapy and combination therapy. This new formulation ofMPNs. Parsaclisib (PI3Kδ) plus ruxolitinib is being evaluated in pivotal trials (1L and inadequate responders), and INCB57643 (BET) and INCB00928 (ALK2) combination trials with ruxolitinib are in proof-of-concept. Once-a-day (QD) ruxolitinib is currently in stability testing and is expected to be submitted to the FDA early next year,for approval in the first half of this year.
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| Performance Highlights | |
Basedbased on positivedata, including overall response rate, from the Phase 2 data presented in 2020, we have opened two pivotal trialsL-MIND study, a single-arm trial of ruxolitinibMonjuvi in combination with parsaclisib (PI3Kd) in first-line myelofibrosis (MF; LIMBER-313) and in MF patients withlenalidomide as a suboptimal response to ruxolitinib monotherapy (LIMBER-304).
Additional Phase 2 trials combining ruxolitinib with investigational agents from our portfolio such as INCB57643 (BET) and INCB00928 (ALK2) in patients with MF are in preparation, and additional discovery and development initiatives are also ongoing within the LIMBER program, which are evaluating both internally-discovered compounds, including itacitinib (JAK1), and candidates from collaboration partners.
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Momentum is strong behind the U.S. launch of Monjuvi, with good uptake in both academic and community settings and illustrated by the market share gained in the first several months since launch.
Updated data from L-MIND form part of the data dossier submitted to the European Medicines Agency (EMA) seeking approval of Monjuvi in Europe for the treatment ofadult patients with r/r DLBCL.
We Monjuvi’s launch is ongoing in the U.S. and uptake continues to increase in the second-line DLBCL setting, with continued penetration into new accounts.
The U.S. launch of Pemazyre has been successful and, in March, we announced that Pemazyre
In addition to our commercialized product portfolio, we also have late-stage assets under development.
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(CITADEL-205) lymphomas were presented at ASH 2020. Data from the CITADEL program are expected to form the basis of an NDA seeking FDA approval of parsaclisib, which is expected to be submittedcurrently being evaluated in the second half of 2021.
In January 2021, we announced that the FDA had accepted for Priority Review our Biologics License Application (BLA) for retifanlimab (PD-1)a Phase 3 trial (POD1UM-303) as a treatment for previously treated patients with advanced squamous cell carcinoma of the anal canal (SCAC) who have
| | | Proxy Statement 2022|5 | |
| Performance Highlights | |
Inflammation and AutoImmunity (IAI) / Dermatology |
RuxolitinibOpzelura™ (ruxolitinib) cream is a potent, selective inhibitor of JAK1 and JAK2 that provides the opportunity was launched on October 11, 2021 for mild to directly target diverse pathogenic pathways that underlie certain dermatologic conditions, includingmoderate atopic dermatitis which(AD) and is a form of eczema, andpending regulatory approval for vitiligo.
The Phase 3 TRuE-AD program of ruxolitinib cream in patients with atopic dermatitis was successful and the NDA seeking FDA approval in this indication was submitted in December 2020. The submission was granted Priority Review and the FDA decision is expected in June 2021.
If approved, we expect the initial uptake of ruxolitinib cream to be driven by specialists in medical dermatology and allergy.
Thepresented positive Phase 3 TRuE-V trials24-week results of
Phase 2 studies for hidradenitis suppurativa, prurigo nodularis and vitiligo. There is significant potential with each of these indications where there are limited treatment options, or in some cases, no FDA-approved therapies.
Partnered Programs (Incyte is eligible for royalties and milestone payments) |
We participate in multiple collaborative partnerships in which we are eligible for milestone payments and royalties on certain Incyte-discoveredIncyte discovered products that we licensed to third parties. TheseCurrently, our key commercialized products include Jakavi®Jakavi® (ruxolitinib) and Tabrecta®Tabrecta® (capmatinib), which are licensed to Novartis, and Olumiant®Olumiant® (baricitinib), which is licensed to Eli LillyLilly.
With the success of the REACH clinical trial program evaluating ruxolitinib in patients with steroid-refactoryPharmaceuticals and Medical Devices Agency (PMDA) as a treatment for steroid-refractory acute (REACH2) and steroid-refractory chronic (REACH3) GVHD Novartis intends to seek approval for Jakavi in Europe and Japan, in these indications.
During 2020, Novartis also announced U.S.respectively. In March 2022, the EMA’s Committee for Medicinal Products for Human Use (CHMP) issued a positive opinion recommending approval of ruxolitinib for the treatment of patients aged 12 and Japanese approvals of Tabrecta for certain patientsolder with non-small cell lung cancer, and intends to submit for approval in Europe during 2021. Tabrecta was discovered by Incyte and global rights were licensed to Novartis in 2009.
During 2020, Lilly announced that Olumiant has been approved in both Europe and Japansteroid-refractory acute graft-versus-host disease or chronic graft-versus-host disease. Capmatinib is under review at the EMA as a treatment for certain patients with atopic dermatitis,NSCLC and expects to announcein April 2022, the FDA decision on its sNDA seekingCHMP issued a positive opinion recommending approval of Olumiantcapmatinib for atopic dermatitis during 2021.
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Tablethe treatment of Contentsadults with metastatic non-small cell lung cancer whose tumors have a mutation that leads to METex14.
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| Performance Highlights | |
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| Performance Highlights | |
| 8|Proxy Statement 2022 | | | |
| | | | | | | | | | | | | | | Committee Membership | | |||||||||
Name and Primary Occupation | | | Director Since | | | Age | | | Independent | | | Other Outside Public Boards | | | Compensation | | | Audit and Finance | | | Nominating and Corporate Governance | | | Science and Technology | |
Hervé Hoppenot—Chairman of the Board President and Chief Executive Officer Incyte Corporation | | | 2014 | | | 62 | | | | | | 1 | | | | | | | | | | | | | |
Julian C. Baker—Lead Independent Director Managing Partner Baker Brothers Investments | | | 2001 | | | 55 | | | ✓ | | | 2 | | | | | | | | | | | | ||
Jean-Jacques Bienaimé Chief Executive Officer BioMarin Pharmaceutical Inc. | | | 2015 | | | 68 | | | ✓ | | | 1 | | | | | | | | | | | | ||
Otis W. Brawley, M.D. Bloomberg Distinguished Professor of Oncology and Epidemiology Johns Hopkins University | | | 2021 | | | 62 | | | ✓ | | | 3 | | | | | | | | | | | | | |
Paul J. Clancy Former Executive Vice President and Chief Financial Officer Alexion Pharmaceuticals, Inc. | | | 2015 | | | 60 | | | ✓ | | | 3 | | | | | | | | | | | | ||
Wendy L. Dixon, Ph.D.1 Former Chief Marketing Officer and President, Global Marketing Bristol-Myers Squibb Company | | | 2010 | | | 66 | | | ✓ | | | 2 | | | | | | | | | | | | | |
Jacqualyn A. Fouse, Ph.D. Chief Executive Officer Agios Pharmaceuticals, Inc. | | | 2017 | | | 60 | | | ✓ | | | 1 | | | | | | | | | | | | ||
Edmund P. Harrigan, M.D. Former Senior Vice President of Worldwide Safety and Regulatory Pfizer Inc. | | | 2019 | | | 69 | | | ✓ | | | 2 | | | | | | | | | | | | | |
Katherine A. High, M.D. President, Therapeutics Asklepios Biopharmaceutical, Inc. | | | 2020 | | | 70 | | | ✓ | | | 1 | | | | | | | | | | | | |
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| Corporate Governance Highlights | |
Expertise | | | Hoppenot | | | Baker | | | Bienaimé | | | Brawley | | | Clancy | | | Fouse | | | Harrigan | | | High | |
Biopharma Industry | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | ✓ | |
Operational Leadership | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | ✓ | | | ✓ | | | ✓ | |
International | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | ✓ | | | ✓ | | | | |
Drug Discovery, Development & Regulatory | | | ✓ | | | | | | ✓ | | | ✓ | | | | | | | | | ✓ | | | ✓ | |
Commercial | | | ✓ | | | | | | ✓ | | | | | | | | | ✓ | | | | | | | |
Financial | | | ✓ | | | ✓ | | | ✓ | | | | | | ✓ | | | ✓ | | | | | | | |
Additional Information | | | | | | | | | | | | | | | | | | | | | | | | | |
PhD/MD | | | | | | | | | | | | ✓ | | | | | | ✓ | | | ✓ | | | ✓ | |
Attendance | | | 100% | | | 100% | | | 93% | | | 100% | | | 100% | | | 100% | | | 88% | | | 100% | |
Independence | | | | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | ✓ | |
Threedevelopment efforts, as well as into healthcare delivery.
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Director | | | Executive/ Industry | | | Drug Discovery | | | Clinical Development | | | Regulatory | | | Business Development | |
Otis W. Brawley, M.D. | | | ✓ | | | | | | ✓ | | | ✓ | | | | |
Edmund P. Harrigan, M.D. | | | ✓ | | | | | | ✓ | | | ✓ | | | ✓ | |
Katherine A. High, M.D. | | | ✓ | | | ✓ | | | ✓ | | | ✓ | | | | |
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| Corporate Governance Highlights | |
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We believe our Board represents a diverse group of individuals that bring various skills and experience. Our Board's continuous efforts to refresh itself have led to a complementary mix of new, mid-term and seasoned directors. We believe this group of directors collectively has the skills to support Incyte in the achievement of our long-term goals.
Matrix of Board Nominees
Expertise | Hoppenot | Baker | Bienaimé | Clancy | Dixon | Fouse | Harrigan | High | ||||||||
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Operational Leadership | ||||||||||||||||
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Commercial | ||||||||||||||||
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Attendance | 100% | 100% | 100% | 100% | 100% | 100% | 88% | 100% | ||||||||
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Independence | ||||||||||||||||
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Proxy Statement | |
| Each year, we conduct stockholder outreach to gather direct feedback on our corporate governance, compensation practices and environmental, social and governance (ESG) practices. Since 2018, we have contacted stockholders who represent the top 80% of our shares outstanding. As a result of our annual stockholder engagement, we have implemented several significant enhancements in our corporate governance, compensation policies, ESG activities and stockholder communication practices. The following changes were made in response to feedback received: | | | STOCKHOLDERS: 80% OF SHARES OUTSTANDING | |
Each year, we proactively reach out to our stockholders to determine how our corporate governance, compensation practices and stockholder communications might improve. In 2018, 2019 and 2020, we contacted stockholders representing approximately 80% of our shares outstanding.
SHARES OUTSTANDING INVOLVED IN OUTREACH CAMPAIGN
As a result of this stockholder engagement over the last five years, we have implemented several significant enhancements in our corporate governance and compensation policies and in our stockholder communication practices. For example, our Board and management team made the following changes in response to feedback received:
| | | Action | | | Year of Implementation | |
| Governance | | | | | ||
✓ | | | Adopted a proxy access bylaw | | | 2021 | |
| Adopted equity ownership guidelines | | | 2016, amended 2021 | | ||
✓ | | | Adopted a director overboarding policy | | | 2020 | |
| | | Compensation | | | | |
✓ | | | Adjusted the executive compensation pay mix to include higher percentages of performance shares | | | Performance Shares added in 2018; increased % of performance shares in 2020 and 2022 | |
✓ | | | Established a three-year performance period for our CEO and other U.S.-based executive officers | | | 2020 | |
✓ | | | Restructured director pay to be based on a set target value instead of fixed share grants | | | 2019 | |
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In our outreach in the fall of 2020, we reached out to top stockholders representing approximately 80% of our shares outstanding. We held conversations with stockholders representing 45% of our shares outstanding, not including the shares owned by Baker Bros. Advisors LP. All engagements included our Chief Financial Officer with additional participation from our Head of Human Resources, our Assistant General Counsel and our Head of Investor Relations. Julian Baker, our Lead Independent Director, was involved in engagements with investors that specifically asked to speak with a member of the Board of Directors.
Following our stockholder outreach, we compiled the feedback we received and presented it to the Nominating and Corporate Governance and Compensation Committees for consideration and to help inform our governance and compensation practices. Mr. Baker, who participated in a number of our off-season proxy engagements, is a member of both of these committees.
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| | Added ESG goals to our Annual Incentive Plan | | | 2022 | |
| | | Disclosed ethnic and racial diversity data for U.S. workforce | | | 2021 | |
✓ | | | Enhanced ESG disclosure | | | 2019 | |
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FeedbackStockholder feedback in 20202021 was largely positive, with investors pleased withexpressing support for the progress Incyte has made in recent yearsyears. Our conversations focused on Board refreshment and diversity, executive compensation and ESG. We continue to progress in response toeach of these investor engagements. Theareas. Beginning with Board refreshment and diversity, the graphic below highlights significantour improvements in ourthis area as well as improvements related to outside Board gender diversity, tenure and level of total Board commitments.
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| Stockholder Engagement | |
commitments.
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| What We Do | | |||
| ✓ We pay for performance, including having a total stockholder return (TSR) component for 2021 performance shares | | | ✓ We have a compensation clawback policy | |
| ✓ 30% of executives’ target equity award value is in the form of performance shares (and that percentage will increase to 33% for 2022) | | | ✓ Our Compensation Committee uses an independent compensation consultant, Compensia, and considers peer groups in establishing executive compensation | |
| ✓ Performance shares have a three-year performance period | | | ✓ Robust anti-hedging and anti-speculation policies in place | |
| ✓ Robust stock ownership guidelines for our CEO, executive officers and our directors | | | ✓ Our Compensation Committee is comprised of all independent directors | |
| ✓ Double-trigger equity vesting in the event of a change-in-control | | | ✓ We conduct an annual say-on-pay vote | |
| ✓ Equity awards have a minimum vesting period of 12 months with a vesting period over 4 years. | | | ✓ We engage proactively with our stockholders throughout the year | |
| What We Don’t Do | | |||
| ✗ We do not reprice stock options | | | ✗ We do not provide golden parachute excise tax gross-ups | |
| ✗ We do not provide single-trigger equity vesting in the event of a change-in-control | | | ✗ We do not provide excessive perquisites for executives | |
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| Executive Compensation Highlights | |
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Average peer CEO compensation reflects 20192020 compensation from the 20202021 proxies of the peer group.
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Our executive compensation program is designed so that a substantial portion of the pay of our Chairman and Chief Executive Officer is delivered in the form of long-term incentives—which means that most of Mr. Hoppenot's Realizable Compensation (meaning, cash actually received during any year and the actual value of that year's equity grants as measured on December 31 of that year) is tied directly to our stock price performance and achievement of our long-term goals. Mr. Hoppenot's compensation, as reported in the Summary Compensation Table on page 68, reflects the accounting value of long-term incentives at grant and not the value actually received from these grants or their potential future value that may actually be realized.
We believe that it is useful to compare Mr. Hoppenot's Realizable Compensation between 2018 and 2020 with his Summary Compensation Table compensation for the same period as illustrated in the chart below.
Target Compensation reflects base salary, target bonus under the annual incentive compensation plan, and the value of equity awards as shown in the Summary Compensation Table, with the value of PSUs in 2018-2020 based on their target number of shares, not the amount of PSUs actually earned. Realizable Compensation includes the same elements as Target Compensation but reflects the actual bonus paid under the annual incentive compensation plan and reflects realizable values for equity granted during the applicable calendar year, calculated as of December 31 of such year, which includes:
The lower Realizable Compensation for each of the three years is the result of a combination of lower stock price, underwater stock options, and short term incentive awards that were, in some cases, earned below target. The Compensation Committee has designed Mr. Hoppenot's compensation to ensure that his Realizable Compensation is closely tied to our stock price performance. Our Compensation Committee believes that its pay for performance compensation strategy is working as intended and is best evaluated by examining Realizable Compensation, rather than solely the accounting compensation set forth in the Summary Compensation Table.
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| | | Proxy Statement | |
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AtOur commitment to operating responsibly is a core purpose of our organization. Incyte our investmentswas founded on the objective of discovering and developing novel therapies for patients in strong scienceneed. As the company has grown, we have challenged ourselves to also Expect More. Operating a sustainable business means more to us than creating solutions and the pursuit of R&D excellence drive our efforts to create new therapies with the potential to improve the lives of patients, make a difference in healthcare, and build sustainable value for all our stakeholders.
In additiongenerating revenues. It means giving back to our communities, protecting our planet and supporting our colleagues. It also means a commitment to improving the treatment and quality of life of patients, we are also determined to enhance the communities in which we live and work and to support our colleagues, all while operating our business in a way that protects the environment.
We value integrity, as well as ethical and responsible behavior in all aspects of our business.
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Creating and developing medicines is our core objective, and we are committed to putting patients first at all times. Our exceptional team of drug discovery and development scientists—led by experienced executives with proven records of success—are working to find solutions for some ofFor the most critical unmet medical needs. We also striveup to ensuredate Environmental, Social and Governance information, please visit
www.incyte.com/responsibility. Please note that all eligible patientsthe information provided on our website is not part of this Proxy Statement.
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For almost 20 years, our science-first approach and heritage in immunologyGlobal Responsibility areas of focus that have been the foundationcommunicated as top priorities by our stakeholders.
Within cancer R&D, our discovery and development strategyit is twofold. In our targeted-therapy strategy, we focus on key molecules/pathways that drive the development, growth and spread of cancer cells, and our immuno-oncology strategy is based on the diversity of cells required to maintain an immune-suppressive tumor microenvironment.
Our research and development efforts in IAI encompass multiple strategies, including leveraging our cross-program knowledge of the JAK-STAT pathway and exploring the potential of JAK inhibition for a number of immune-mediated dermatologic conditions with a high unmet medical need, including atopic dermatitis and vitiligo.
During 2020, our clinical development team managed over 120 different clinical trials, 31 of which were new studies that were opened during the year, and 47 of which were completed. Our global clinical trials took place at over 2,000 different sites in 29 different countries, further illustrating our commitment to bringing medicines to patients that need them.
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Patient advocacy serves an important role in carrying out our commitment to patients while supporting the rigorous pursuit of science. We engage the advocacy community to obtain important feedback, including for clinical trial design and protocols, as well as to incorporate readily-understandable language in all relevant materials.
During 2020, our U.S. patient advocacy team held a number of patient advocacy advisory board meetings, engaging 25 different patient support organizations across oncology (focused on MPNs, DLBCL and GVHD) and dermatology (covering atopic dermatitis).
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We strive to ensure that eligible patients have access to our medicines. This can take the form of access to applicable clinical trials by providing patients with information and resources to support their treatment journey, or by providing individual patients with access to unapproved or investigational products through our compassionate use programs.
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For our approved medicines, programs such as IncyteCARES, CML Life and My MISSION Support are designed to help eligible patients before and during applicable treatments. Such help and assistance may include reimbursement support, opportunities for financial assistance, delivery coordination of medicines and temporary coverage for access delays, as well as connections to other support services and to other education and helpful resources.
At Incyte, we seek to price our medicines responsibly in a way that reflects their value to patients and society. We strongly believe that patients should have access to the medicines they are prescribed, and are committed to working with policy makers and leading insurers in the U.S. to increase patient access to needed medications and lower out-of-pocket cost burdens for patients. Specifically, we support legislation that would redesign the Medicare Part D program by reducing out of pocket costs as well as legislation that would provide patient protections and guardrails around the use of step therapy protocols.
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Patient safety is at the forefront of all our activities. We are determined to adhere to the regulations in all territories in which we operate clinical trials, and to conducting those clinical trials in an ethical manner. We are also committed to the supervision of all ongoing trials through an institutional review board, an ethics committee and/or a research ethics board in an effort to protect the safety of trial participants before, during and after patients are treated.
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At Incyte it's always been important to make a difference in our communities where we live and work. It's part of who we are as a company.
During 2020, the Incyte Charitable Giving Foundation expanded its ongoing donations to include two new organizations—FAME Inc. and One Village Alliance—both of which are located close to our global headquarters in Delaware and which aim to increase educational opportunities for underserved communities.
We continue to support the Incyte Cancer Care Assistance Fund for Delaware which provides emergency financial assistance for cancer patients, their caregivers and family members living in Delaware. This emergency fund was established for the sole purpose of providing emergency financial assistance to people with cancer who reside in Delaware, and the fund covers medical expenses and/or basic living expenses to help participants and caregivers cope with the emotional and life changing aspects of cancer.
We are also very pleased to have increased our support for the Food Bank of Delaware, including to cover the costs of increased food distribution and pre-made weekend meal kits. The Food Bank works to close the food insecurity gap, which has grown significantly during the COVID-19 pandemic.
Restrictions, including stay-at-home orders, related to COVID-19 made volunteering more difficult to measure in 2020, but we continue to encourage our teammates to give back to their communities as appropriate while keeping safety in mind. Incyte's measured volunteerism was 206 hours in 2020 compared to 780 hours in 2019.
Incyte's Matching Gifts program was as robust as ever, with more than $170,000 in employee donations to charitable causes matched by Incyte during 2020.
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Incyte is committed to promotingcultivate an environment where our colleagues know they are fulfilled and valued. We promote a company culture based on scientific excellence as we seek to create new treatments and we seek positive
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collaboration with each other. Working collaboratively is of the utmost importance as we aim to change the treatment landscape for patients with cancer and inflammatory and autoimmune diseases.
| Global Responsibility | |
We strive
Many professional development opportunities are organized by department. For example, the E.D.G.E. (Empowerment, Development, Growth, Engagement) Program seeks to connect and empower Incyte employees in the U.S. Business Team to foster professional growth and leadership. This is accomplished through speaker programs and networking opportunities, featuring internal and external leaders, mentorship opportunities, and increased awareness of professional development opportunities.
In the U.S., leadership development training is provided to managers that are new to Incyte, employees who were recently promoted to managers and those individuals that have been identified as potential leaders. Additionally, classes in presentation skills and emotional intelligence are offered throughout the organization as well as the Insights Discovery Workshop.
In Europe, managers are eligible for selection to participate in a training program, which includes multiple modules with unique focus areas. A team effectiveness workshop is in place for teams to help improve communication, accountability, decision-making and overall performance. The Insights Discovery workshop seeks to improve internal and external communication. In addition, the Challenge Academy is a program aimed at challenging employees through specific projects.
We believe these professional opportunities enhance our colleagues' skills, career aspirations,and job satisfaction as well as provide personal enrichment.
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It is our goal to conduct business in a manner that does not compromise the health of people nor the state of the environment. It is our policy to comply with all applicable environmental health and safety (EHS) regulatory requirements and seek to continually improve our EHS management systems.
A strong safety culture is a fundamental part of how we work, and our philosophy is that everyone at Incyte has a responsibility to create and maintain a safe and healthy workplace with a goal to reduce risk and prevent injuries. Our management team recognizes this responsibility and is committed to providing the resources necessary to achieve this goal.
When the COVID-19 pandemic began in March, we facilitated a seamless transition to remote working and were able to offer a gradual and voluntary return to offices beginning in June. Multiple protocols remain in place for our office and laboratory teams, as described elsewhere in this Proxy Statement.
During 2020, Incyte teams once again participated in the Annual Activity Challenge. This year, the challenge began earlier than usual with the idea to keep people active, especially during periods of enforced confinement. 31 Incyte teams made up of over 270 participants from across the globe logged 157,325,101 steps equal to 78,663 miles—enough steps to take three trips around the world.
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Incyte offers a competitive compensation package, which allows 100% of global Incyte employees to participate in the annual incentive compensation plan. Annual equity-based grants are also afforded to 100% of global Incyte employees to further incentivize performance as well as retention.
We seek to ensure our compensation package remains competitive by benchmarking against our peers several times annually as well as reviewing compensation twice per year to confirm that our employees are being
| | | Progress in 2021 | |
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| | ✓ Revamped individual development planning to focus on the most relevant core competencies for each division ✓ Added pilot program for continuing education | |
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compensated fairly, equitably (including gender pay equity), and in accordance with our pay structures and job levels.
Our benefits package also includes an option to participate in our Employee Stock Purchase Plan for both full-time and part-time employees working at least 20 hours per week.
Over the years, we have added numerous benefits to support our colleagues in their professional as well as personal endeavors.
Our industry-leading U.S. health insurance coverage is 100% covered for full-time employees and is 95% subsidized for part-time employees working at least 20 hours per week in the U.S. A healthcare resource program is another one of many complimentary benefits provided by Incyte in the U.S., which offers broad assistance with a variety of healthcare and insurance-related issues to help colleagues make more informed healthcare decisions.
The benefits package also includes many complimentary tools for health, including the Employee Assistance Program (EAP), which is provided at no cost to employees to help with a variety of personal and work-related concerns, difficulties and problems 24 hours a day and 365 days per year.
Other ad hoc benefits may include on-site COVID antibody testing, flu shots and learning opportunities that are often offered on-site and/or virtually, including nutrition, wellness and financial planning seminars.
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Our management team makes themselves available to all employees, and members of our executive management attempt to meet with new employees within the first six months of employment.
Our quarterly Town Hall events include presentations by executive management and allow for Q&A at the end of each. Our open-door culture allows for continuous ad-hoc feedback and helps drive innovation in all departments, not just within discovery and development.
| | | ✓ Required all employees and those who enter our buildings to be fully vaccinated against COVID-19 ✓ Offered COVID-19 vaccinations and testing on-site ✓ Eliminated use of PTO when sick | |
Compensation and Benefits |
| | ✓ Adjusted 2022 merit increases to reflect higher inflation ✓ Added Wellthy, which provides personalized support to help tackle the logistical and administrative tasks related to caring for family ✓ Added Hinge, which provides exercise therapy tailored to each employee’s specific need ✓ Added Omada, which provides personalized support to achieve individual health goals ✓ Updated parental leave policy: ✓ Primary caregivers are now entitled to a total of 16-18 weeks of family leave inclusive of short-term disability ✓ Secondary caregiver is entitled to 4 weeks of family leave | |
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We were proud to be named the #2 Top Employer by Science in Incyte was recognized specifically for: being socially responsible ✓
having loyal employees ✓
treating employees with respect | | | |||
| For the first time, Incyte was recognized as one of Newsweek’s Top 100 Most Loved Workplaces for 2021. We ranked #77 on the list and were one of four biopharma companies included in the list. Newsweek noted that Incyte was loved because of benefits such as 100% coverage for health insurance as well as parental leave for all situations, such as in the case of adoption. | | | |
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We believe that creative solutions are best achieved by diverse teams working together, and inclusion is therefore vital to the biopharmaceutical industry and is essential to Incyte. Diversity of thoughts, backgrounds, perceptions and ideas help us create the medical solutions that patients require, and represent the lifeblood of organizations such as ours.
As of December 31, 2020, 50% of our global workforce are women, and 38% of our global leadership positions are filled by women. In addition, three of our eight Board members are women, resulting in 38% female representation on our Board of Directors. This compares well with the average among S&P 500 constituents, wherein 28% of all Board seats are currently taken by women.
Incyte was founded on the premise that the pursuit of R&D excellence creates value for society and for all of our internal and external stakeholders, and we know that our continued and future success depends on the creativity that only a diverse team can generate. We are committed to ensuringDiversity of thoughts, backgrounds, perceptions and ideas helps us create the medical solutions that we are recruiting from the widest possible talent pool from where we then select candidates based on merit.
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Proxy Statement | |
| Global Responsibility | |
Amongst our U.S. workforce, 35% self-report as non-white, which is comparable to the 2010 United States Census data from the State
women.
| As of December 31, 2021, 33% of our U.S. workforce self-reported as non-white, which is comparable to the 2020 United States Census data from the State of Delaware, the location of our global headquarters (38% non-white). We do not collect racial diversity data outside of the U.S., given various privacy restrictions. We are committed to recruiting from the most diverse talent pool possible. This is true for our workforce, our Executive Management Team and other leadership positions across the organization. | | |
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Our Executive Management teamTeam (“ET”) is made up of a diverse group of very experienced individuals who are representativewith a range of our global outlookexperiences and the multicultural naturebackgrounds. Nine of the pharmaceutical industry. As an illustration of the dievrsity of thought and backgrounds of our Executive Management team, nine of the twelvethirteen ET members were born outside of the U.S.
We believe this diversity of perspectives and approaches drives innovation, fosters new ideas and creates a work environment that values equality and collaboration.
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| Global Responsibility | |
We also recognize our role in supporting diversity beyond our workforce. Incyte uses multiple external suppliers, consultants and other agency partners to fulfill our mission, and we intend to establish an Inclusion Commitment for all appropriate counterparties to help us pursue our diversity and inclusion goals. We are also looking to increase the numberinclusion. The Committee established 5 key sub-committees, each with a different area of minority owned vendors and consultants that we use.focus:
As a drug development company, we know how essential it is that the U.S. drug development industry works to increase the inclusion of Black patients into clinical trials. We intend to explore opportunities to increase this
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throughMinimizing our Environmental ImpactClinical Trial Diversity Working Group. The COVID-19 pandemic, and its disproportionate impact on Black communities in the U.S., has brought the need to ensure appropriate participation in clinical trials into ever-sharper relief. We intend to work towards meaningful solutions across our clinical studies to support and encourage appropriate representation of all racial and ethnic groups.
In addition to the initiatives above, in June 2020, and in support of the Black Lives Matter movement, we donated an undisclosed amount to two local organizations—FAME Inc. and One Village Alliance—both of which are located close to our global headquarters in Delaware and which aim to increase educational opportunities for underserved minorities in the State.
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Incyte is committed to operating in a way that minimizes our environmental impact. InSince the spring of 2020, when we published our inaugural SASB Summary, which included initial environmental metrics.
In the coming years, we planhave worked to expand upon these metricsour environmental measurements and initial disclosures as well as toand seek ways tosolutions that may reduce our impact on the environment. During 2021, we transitioned the source of our electricity at U.S. Headquarters to be 100% renewable. We also completed a project to make airflow in our labs more efficient.
| | | Proxy Statement 2022|19 | |
| Global Responsibility | |
We are determined to become a carbon neutral organization. While we acknowledge that finding solutions to further reducedisclosed our absolute carbon emissions may take time, the climate imperative means that we will not wait
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to act, and we have already begun by offsetting 100% of our measured carbon emissions in the U.S. in 2019* through verified reforestation carbon credit projects.
*For 2019, we measured Scope 1 and Scope 2 for the properties wholly owned by Incyte that were fully functional for all of 2019. This includes U.S. Headquarters, which consists of Building 1801 and Building 1815. This represents 66% of our total office space in the U.S.
Over time, we expect to continue to work to reduce our absolute emissions by using additional renewable energy sources, moving our U.S. and European fleets to hybrid or electric vehicles and making appropriate infrastructure investments to enable increased uses of renewable energy sources as we continue to expand.
Our key environmental target through combinations of absolute CO2 reductions and offsets of our remaining emissions, is to be aan operationally carbon neutral organization by 2025,. In addition, we set three environmentally-related goals, as shown below, and three specific tactical goals to help us achieve this ambitious target are laid out below.we have already made progress toward their achievement.
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Cybersecurity and the awareness of and preparedness for related risks are a high priority at Incyte. The Audit and Finance Committee of the Board is updated by our cybersecurity team at least twice per year, and Incyte has not had a cyber breach in the past three years. We carry cybersecurity risk insurance, and conduct an annual cybersecurity audit with a different third party on each occasion.
All employees and contractors are required to attend mandatory cybersecurity awareness training, and refresher modules are also provided. In 2020, we conducted 26 online training sessions for the global user population, and recordings were also shared thereafter. We also conducted multiple "Cybersecurity at Home" training sessions covering the protection of, for example, home routers and smart home / smart car technologies, as well as recommendations for identity and home internet access protection.
We conduct phishing simulation email campaigns twice a year. As a result of these increased awareness activities, the percentage of phish-prone users declined in 2020, and the percentage of users who forwarded the phishing simulation campaign emails to the Incyte cybersecurity mailbox increased.
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The new disclosures made as part of our Global Responsibility initiative in 2020 have led to significant improvements in Incyte's scores and ratings by key ESG stakeholders, such as S&P Global, MSCI and Sustainalytics.
We expect our Global Responsibility initiative will continue to evolve, and we look forward to updating and adding to our disclosures in the coming years. For the most up to date Environmental, Social and Governance information, as well as our latest SASB Summary, please visit www.incyte.com/responsibility. Please note that the information provided on our website is not part of this Proxy Statement.
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Incyte is very grateful to the millions of people around the world fighting the COVID-19 pandemic and its effects on society—from doctors, nurses and to all other essential workers who are continuing to provide their much-needed services. We have also sought to contribute to this fight in several ways, as described below.
When we enacted our global business continuity plans in the spring of 2020, our key priorities were to ensure that patients continue to receive their life-saving medicines, that we continue to provide our patients, customers and employees the support they need, and importantly, to do this in a manner that minimizes the health risks to all.
ARDS = Acute Respiratory Distress Syndrome; EAP = Expanded Access Program.
We also created, and continue to maintain, dedicated COVID-19 resource pages on the Incyte corporate website www.incyte.com/covid-19 and on our company intranet site, enabling easy access to updated information on the disease, Incyte's responsiveness, potential treatments, and vaccine availability, as well as links to published guidelines, including from the CDC, WHO, NIOSH and OSHA.
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We were well prepared going into this crisis as we had ample drug supply, thereby ensuring availability of commercial medicines to patients. Our manufacturing processes have also proceeded without interruption, and despite the challenges of the pandemic, our team has continued to provide the level of service and responsiveness that our customers have been accustomed to over the years. We have expanded our multi-channel engagements and our field representatives are conducting multiple virtual and digital programs with our customers, and we prioritized patient needs by delivering commercial and clinical trial medicines to home addresses, where necessary and possible.
Our clinical team made the decision to allow patients, care-givers and physicians to decide on patients' participation in clinical programs, and we did not make any unilateral decisions to close or suspend enrollment in any of our clinical trials. Regional shutdowns and similar policies have affected certain studies, but the impact has been largely transient to date, and we have been able to remain on track with timelines for most key development programs.
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On the regulatory front, there was no impact on key timelines—as evidenced by the early FDA approvals that we announced for Pemazyre® (pemigatinib), Tabrecta® (capmatinib) and Monjuvi® (tafasitamab-cxix).
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At the outset of the pandemic, we rapidly mobilized our clinical and alliance management teams as we sought to uncover if our molecules might be of benefit to patients with COVID-19. We launched two Phase 3 trials (one of which was in collaboration with Novartis), evaluating ruxolitinib and we removed all contractual obstacles to enable Lilly to open trials evaluating baricitinib.
In November 2020, with Lilly we announced that that the FDA issued an Emergency Use Authorization (EUA) for the distribution and emergency use of baricitinib to be used in combination with remdesivir in hospitalized adult and pediatric patients two years of age or older with suspected or laboratory confirmed COVID-19 who require supplemental oxygen, invasive mechanical ventilation, or extracorporeal membrane oxygenation.
The EUA was supported by data from the Adaptive COVID-19 Treatment Trial (ACTT-2), which was sponsored by the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH). In December 2020, the New England Journal of Medicine published peer-reviewed results from the Phase 3 ACTT-2 trial, which included 1,033 patients from 67 trial sites in eight countries.
In December 2020, with Novartis we announced that the Phase 3 RUXCOVID study evaluating the safety and efficacy of ruxolitinib plus standard-of-care (SOC) as a treatment for non-ventilated patients 12 years and older with COVID-19 associated cytokine storm did not meet its primary endpoint. In addition, there was no clinically relevant benefit observed among secondary and exploratory endpoints.
In March 2021, we announced results from the Phase 3 369-DEVENT study evaluating the efficacy and safety of ruxolitinib (5mg and 15mg) plus standard of care (SOC) versus SOC in patients 12 years and older on mechanical ventilation with COVID-19 associated Acute Respiratory Distress Syndrome (ARDS). While improvement in mortality trended positively, statistical significance was not reached for the overall study population. However, a significant improvement in mortality was seen in U.S. patients at both doses and in the overall study population when both doses were pooled. We plan to make ruxolitinib available to eligible patients in the U.S. at no cost via an Expanded Access Program pending agreement with the U.S. Food and Drug Administration.
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At the onset of the pandemic, we donated supplies, including personal protective equipment (PPE), from our laboratories in Wilmington, Delaware, to one of our local hospital systems that, like others, was facing a critical shortage. We also made a donation to fund the purchase of hospital equipment and goods to support patients, hospitals, healthcare facilities and providers in the critically affected Lombardy region of Italy.
At all Incyte locations, we initiated a seamless transition to remote working in March 2020 and from June 2020 were able to offer a gradual and voluntary return to offices where regional regulations permitted. Multiple protocols remain in place in all our global offices, including temperature checks, physical distancing and mask requirements, as well as the opportunity for rapid, finger-stick serological tests, to ensure safe workplaces for those who opt to return.
For our laboratory teams, rigorous safety precautions were put in place to allow essential operations to continue, even during the the spring of 2020, and our laboraties returned to full operations in May 2020. Ongoing precautions include temperature checks on entry and the mandatory use of PPE including surgical or N95 masks and gloves for all while on our laboratory campuses. Rapid, finger-stick serological tests are also available.
There have not been any staff reductions as a result of COVID-19, and we also took the decision to maintain all on-site and allied support staff at all of our facilities on full pay and benefits, including during the initial periods of enforced confinement because of stay-at-home orders.
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We also understand that periods of solitude and other effects of the pandemic have the potential to take a significant toll on the health and wellbeing of our team, and therefore numerous additional actions were taken and support provided, often in response to feedback and other requests from within the organization.
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The Board proposes the election of eight directors of our Company to serve until the next annual meeting of stockholders, or thereafter until their successors are duly elected and qualified. If any nominee is unable or declines to serve as director at the time of the Annual Meeting, an event that we do not currently anticipate, proxies will be voted for any nominee designated by the Board to fill the vacancy.
Director Nominees |
Names of the nominees and certain biographical information about them are set forth below:
Hervé Hoppenot |
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| | CHAIRMAN OF THE BOARD Age: 62 | | | COMMITTEES: • None | | |
DIRECTOR SINCE: 2014 | | |||||||||
BACKGROUND: | ||||||||||
Mr. Hoppenot joined Incyte as President and Chief Executive Officer and a Director in January 2014, and was appointed Chairman of the Board in May 2015. Mr. Hoppenot served as the President of Novartis Oncology, Novartis Pharmaceuticals Corporation, the U.S. subsidiary of Novartis AG, a pharmaceutical company, from January 2010 to January 2014. Prior to that, Mr. Hoppenot served in other executive positions at Novartis Pharmaceuticals Corporation, serving from September 2006 to January 2010 as Executive Vice President, Chief Commercial Officer of Novartis Oncology and Head of Global Product Strategy & Scientific Development of Novartis Pharmaceuticals Corporation and from 2003 to September 2006 as Senior Vice President, Head of Global Marketing of Novartis Oncology. Prior to joining Novartis, Mr. Hoppenot served in various increasingly senior roles at Aventis S.A. (formerly Rhône Poulenc S.A.), a pharmaceutical company, including as Vice President Oncology US of Aventis Pharmaceuticals, Inc. from 2000 to 2003 and Vice President US Oncology Operations of Rhone Poulenc Rorer Pharmaceuticals, Inc. from 1998 to 2000. | ||||||||||
QUALIFICATIONS: | ||||||||||
The Board has concluded that Hervé Hoppenot should serve on the Board because he has significant leadership and senior management experience from his various executive positions in the healthcare industry, including as the President of Novartis Oncology, Novartis Pharmaceuticals Corporation. His past experiences and his current role as our CEO give him strong knowledge of our strategy, markets, competitors, financials and operations. | ||||||||||
OTHER PUBLIC COMPANY BOARDS: | | |||||||||
Current Cellectis S.A. | | | Past 5 Years None | |
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Julian C. Baker |
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| | LEAD INDEPENDENT DIRECTOR Age: 55 | | |
• Nominating and Corporate Governance (Chair) • Compensation | | | DIRECTOR SINCE: 2001 | | ||||||
BACKGROUND: | ||||||||||
Mr. Baker is a Managing Member of Baker Bros. Advisors LP, which he and his brother, Felix Baker, Ph.D., founded in 2000. Baker Bros. Advisors LP is a biotechnology-focused investment advisor to fund partnerships whose investors are primarily endowments and foundations. Mr. | ||||||||||
QUALIFICATIONS: | ||||||||||
The Board has concluded that Julian C. Baker should serve on the Board because he is an experienced investor in many life sciences companies. He brings to the Board significant strategic and financial expertise and extensive knowledge of the life sciences and biopharmaceuticals industries as a result of his investments in and service as a director of other publicly and privately held life sciences companies. | ||||||||||
OTHER PUBLIC COMPANY BOARDS: | | |||||||||
Current Prelude Therapeutics Incorporated | | | Past 5 Years Genomic Health, Inc. Idera Pharmaceuticals, Inc. (2014-2018) | |
Jean-Jacques Bienaimé | | |
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| | | DIRECTOR SINCE: 2015 | |
BACKGROUND: | ||||||||||
Mr. Bienaimé has served as Chief Executive Officer and a member of the board of directors of BioMarin Pharmaceutical Inc., a biopharmaceutical company, since May 2005. Mr. Bienaimé has also served as Chairman of BioMarin since June 2015. From November 2002 to April 2005, Mr. Bienaimé served as Chairman, Chief Executive Officer and President of Genencor, a biotechnology company focused on industrial bioproducts and targeted cancer biotherapeutics. Prior to joining Genencor, Mr. Bienaimé was Chairman, President and Chief Executive Officer of SangStat Medical Corporation, an immunology focused biotechnology company that was later acquired by Genzyme Corporation. He became President of SangStat in 1998 and Chief Executive Officer in 1999. Prior to joining SangStat, Mr. Bienaimé held various management positions from 1992 to 1998 with Rhône Poulenc Rorer Pharmaceuticals (now known as Sanofi Aventis), including Senior Vice President of Corporate Marketing and Business Development, and Vice President and General Manager of the advanced therapeutic and oncology division. Mr. Bienaimé is a director of the Biotechnology Innovation Organization and the Pharmaceutical Research and Manufacturers of | ||||||||||
QUALIFICATIONS: | ||||||||||
The Board has concluded that Jean-Jacques Bienaimé should serve on the Board because he has significant leadership experience in the management of biotechnology organizations, business development, and sales and marketing of both biotechnology and pharmaceutical products. He also brings significant experience as a director of other publicly held life sciences companies. | ||||||||||
OTHER PUBLIC COMPANY BOARDS: | | |||||||||
Current BioMarin Pharmaceutical Inc. | | | Past 5 Years Vital Therapies, Inc. (2013-2018) | |
| 22|Proxy Statement 2022 | | | |
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Otis W. Brawley, M.D. | | | INDEPENDENT DIRECTOR Age: 62 | | | COMMITTEES: • Science and Technology | | | DIRECTOR SINCE: 2021 | |
BACKGROUND: Dr. Brawley has served as a Bloomberg Distinguished Professor of Oncology and Epidemiology at Johns Hopkins University since January 2019. From April 2007 to December 2018, Dr. Brawley served as the Chief Medical and Scientific Officer of the American Cancer Society. From January 2002 to August 2007, Dr. Brawley was director of the Georgia Cancer Center at Grady Memorial Hospital. From April 2001 to December 2018, Dr. Brawley served as Professor of hematology, oncology, medicine and epidemiology at Emory University. Prior to joining Emory University, Dr. Brawley was an assistant director and senior investigator at the National Cancer Institute and an internist and oncologist at the National Institutes of Health Clinical Center and Bethesda Naval Hospital. QUALIFICATIONS: The Board has concluded that Otis W. Brawley should serve on the Board because he has significant medical and scientific leadership experience. Dr. Brawley’s medical and academic background in oncology and hematology, together with his medical, scientific and public health leadership experience, are expected to assist the Board in its oversight role over our drug discovery and development efforts and to provide the Board with relevant insight into healthcare delivery. In addition, Dr. Brawley has experience serving as a director of other publicly held life sciences companies. OTHER PUBLIC COMPANY BOARDS: | | |||||||||
Current Agilent Technologies, Inc. Lyell Immunopharma, Inc. PDS Biotechnology Corporation | | | Past 5 Years None | |
Paul J. Clancy | | | INDEPENDENT DIRECTOR Age: | | | COMMITTEES: • Audit and Finance (Chair) • Compensation | ||
| | | DIRECTOR SINCE: 2015 | |
BACKGROUND: | |||||||||
Mr. Clancy has more than 30 years of experience in financial management and strategic business planning, and served as a senior advisor from October 2019 until July 2020 to, and as the Executive Vice President and Chief Financial Officer from July 2017 through October 2019 of, Alexion Pharmaceuticals, Inc., a biopharmaceutical company. Prior to joining Alexion, Mr. Clancy served as Executive Vice President, Finance and Chief Financial Officer of Biogen Inc. (formerly known as Biogen Idec Inc.), a biopharmaceutical company, from August 2007 until June 2017. He also served as Senior Vice President of Finance of Biogen, with responsibilities for leading the treasury, tax, investor relations and business planning groups. Prior to the 2003 merger of Biogen, Inc. and IDEC Pharmaceuticals Corporation to form Biogen, Mr. Clancy was the Vice President of Portfolio Management of Biogen. He joined Biogen in 2001 as Vice President of U.S. Marketing. Before Biogen, Mr. Clancy spent 13 years at PepsiCo Inc., a food and beverage company, serving in a variety of financial, strategy and general management positions. | |||||||||
QUALIFICATIONS: | |||||||||
The Board has concluded that Paul J. Clancy should serve on the Board because he has significant financial and executive leadership experience at large multi-national biopharmaceutical companies. Mr. Clancy also has experience as a director of a publicly held biotechnology company, and his breadth and depth of financial experience position him well to serve as Chair of the Audit and Finance Committee of the Board. | |||||||||
OTHER PUBLIC COMPANY BOARDS: | | ||||||||
Current Agios Pharmaceuticals, Inc. Exact Sciences Corporation Xilio Therapeutics, Inc. | | | Past 5 Years None | ||||||
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Jacqualyn A. Fouse, Ph.D. | | | INDEPENDENT DIRECTOR Age: | | | COMMITTEES: • Audit and Finance • Nominating and Corporate Governance | ||
| | | DIRECTOR SINCE: 2017 | |
BACKGROUND: | ||||||||||
Dr. Fouse has served as Chief Executive Officer of Agios Pharmaceuticals, Inc., a biopharmaceutical company, since February 2019. Prior to Agios, she served as Executive Chair of Dermavant Sciences, a biopharmaceutical company from July 2017 to September 2018. From September 2010 until June 2017, Dr. Fouse served in various capacities at Celgene Corporation, a biopharmaceutical company, serving as Strategic Advisor to the Management Executive Committee from April 2017 to June 2017, President and Chief Operating Officer from March 2016 to March 2017, President, Hematology and Oncology from August 2014 to February 2016, Executive Vice President and Chief Financial Officer from February 2012 to July 2014, and Senior Vice President and Chief Financial Officer from September 2010 to February 2012. Prior to joining Celgene, Dr. Fouse served as Chief Financial Officer of Bunge Limited, a global agribusiness and food company, from July 2007 to September 2010. Prior to joining Bunge, Dr. Fouse served as Senior Vice President, Chief Financial Officer and Corporate Strategy at Alcon Laboratories, Inc. since 2006, and as its Senior Vice President and Chief Financial Officer since 2002. Prior to her time with Alcon she held a variety of senior leadership roles with international companies. | ||||||||||
QUALIFICATIONS: | ||||||||||
The Board has concluded that Jacqualyn A. Fouse should serve on the Board because she has significant corporate finance, financial reporting and accounting expertise as a result of her executive roles at Agios and previously at Dermavant Sciences and Celgene, as well as her prior positions with other companies. Additionally, Dr. Fouse is able to provide diverse and valuable corporate governance, management, operational and strategic expertise to the Board through her experience as an executive officer and a public company board member. | ||||||||||
OTHER PUBLIC COMPANY BOARDS: | | |||||||||
Current Agios Pharmaceuticals, Inc. | | | Past 5 Years Celgene Corporation (2016-2017) | |
Edmund P. Harrigan, M.D. | | |
Age: |
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| | COMMITTEES: • Science and Technology (Chair) | | | DIRECTOR SINCE: 2019 | |
BACKGROUND: | ||||||||||
Edmund P. Harrigan, M.D. joined the Board in December 2019. Dr. Harrigan served as Senior Vice President of Worldwide Safety and Regulatory for Pfizer Inc. from 2012 until his retirement in 2015. Dr. | ||||||||||
QUALIFICATIONS: | ||||||||||
The Board has concluded that Edmund P. Harrigan should serve on the Board because he has significant executive leadership experience in the pharmaceutical and biotechnology industry, including experience in drug discovery and development, regulatory affairs and business development. Dr. Harrigan also brings substantial medical and scientific experience to the Board. In addition, Dr. Harrigan has significant experience serving as a director of other publicly held life sciences companies. | ||||||||||
OTHER PUBLIC COMPANY BOARDS: | | |||||||||
Current ACADIA Pharmaceuticals, Inc. PhaseBio Pharmaceuticals, Inc. | | | Past 5 Years Bellicum Pharmaceuticals, Inc. (2018-2019) Karuna Therapeutics, Inc. (2011-2020) | |
| 24|Proxy Statement 2022 | | | |
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Katherine A. High, M.D. |
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| | INDEPENDENT DIRECTOR Age: 70 | | | COMMITTEES: • Science and Technology | | |
DIRECTOR SINCE: 2020 | | |||||||||
BACKGROUND: | ||||||||||
Katherine A. High, M.D., joined the Board in March 2020. Dr. High has served as President, Therapeutics of Asklepios Biopharmaceutical, Inc., a biotechnology and gene therapy company that is a wholly-owned subsidiary of Bayer AG, since January 2021. Dr. High served as President of Spark Therapeutics, Inc., a gene therapy company, from September 2014 until February 2020 and as Head of Research and Development of Spark from September 2017 until February 2020. From September 2014 through September 2017, Dr. High served as Chief Scientific Officer of Spark. Prior to serving as President of Spark, Dr. High provided advice to Spark and subsequently served as an independent consultant to Spark from December 2013 to September 2014. From July 1999 through September 2014, Dr. High was a Professor at the Perelman School of Medicine at the University of Pennsylvania. From March 2003 through September 2014, Dr. High was an Investigator of the Howard Hughes Medical Institute. Dr. High served as the Director of the Center for Cellular and Molecular Therapeutics at | ||||||||||
QUALIFICATIONS: | ||||||||||
The Board has concluded that Katherine A. High should serve on the Board because she has significant executive, scientific and medical leadership experience, including extensive academic and industry experience in drug discovery and development. Her medical background, together with her experience leading drug discovery and development efforts at Spark Therapeutics, are expected to assist the Board in its oversight role over our drug discovery and development efforts. In addition, Dr. High has experience serving as an executive officer and director of publicly traded life sciences companies. | ||||||||||
OTHER PUBLIC COMPANY BOARDS: | | |||||||||
Current CRISPR Therapeutics AG | | | Past 5 Years Spark Therapeutics, Inc. (2014-2019) | |
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The Board has appointed an Audit and Finance Committee, a Compensation Committee, a Nominating and Corporate Governance Committee and a Science and Technology Committee. The Board has determined that each director who serves on these committees is "independent,"“independent,” as that term is defined by applicable listing standards of The Nasdaq Stock Market and Securities and Exchange Commission rules. The Board has approved a charter for each of these committees, acommittees. A current copy of each committee'scommittee’s charter can be found on our website at http://www.incyte.com under the "Corporate Governance"“Corporate Governance” heading in the "For Investors"“For Investors” portion of our website. The Board has also appointed a Non-Management Stock Option Committee.
Audit and Finance Committee | | | COMMITTEE MEMBERS | |
The Audit and Finance ➤ assisting the Board in fulfilling its oversight responsibilities relating to the ➤ appointing, compensating, evaluating and, when appropriate, replacing our independent registered public accounting firm; ➤ reviewing and pre-approving audit and permissible non-audit services; ➤ reviewing the scope of the annual audit; ➤ monitoring the independent registered public accounting ➤ meeting with the independent registered public accounting firm and management to discuss and review our financial statements, internal control over financial reporting, and auditing, accounting and financial reporting processes; ➤ reviewing the results of ➤ overseeing the management of risks associated with financial and accounting systems, accounting policies, public reporting, investment strategies and cybersecurity, including the periodic review of ➤ overseeing our internal audit function; and ➤ reviewing matters related to the The Board has determined that Mr. Clancy and Dr. Fouse are each qualified as an Audit Committee Financial Expert under the definition outlined by the Securities and Exchange Commission. No member of our Audit and Finance Committee sits on more than three public company audit committees, including ours. | |
| Paul J. Clancy (Chair) Wendy L. Dixon1 Jacqualyn A. Fouse Met 8 times in | |
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TableDr. Wendy L. Dixon is retiring from the Board as of Contents
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26|Proxy Statement 2022 | | | |
| Board Committees | |
Compensation Committee | | | COMMITTEE MEMBERS | |
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| Jean Jacques Bienaimé (Chair) Julian C. Baker Paul J. Clancy Met 5 times in | |
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Nominating and Corporate Governance Committee | | | COMMITTEE MEMBERS | |
The Nominating and Corporate Governance ➤ identifying qualified individuals to become members of the Board; ➤ determining the composition of the Board and its committees; ➤ monitoring a process to assess Board effectiveness; ➤ recommending nominees to fill vacancies on the Board; ➤ reviewing and making recommendations to the Board with respect to candidates for director proposed by stockholders; ➤ reviewing the composition, functioning and effectiveness of the Board and its committees; ➤ developing and recommending to the Board codes of conduct applicable to officers, directors and employees and charters for the various committees of the Board; and ➤ reviewing and making recommendations to the Board regarding the succession plan relating to our CEO and other executive officers. | |
| Julian C. Baker (Chair) Jean Jacques Bienaimé Jacqualyn A. Fouse | |
Met 4 times in 2021 | |
Science and Technology Committee | | | COMMITTEE MEMBERS | |
The Science and Technology ➤ assisting the Board in its general oversight of the ➤ providing strategic advice to the Board and management regarding emerging science and technology issues and trends; ➤ reviewing and assessing the ➤ assisting the Board with its oversight responsibility for enterprise risk management in areas affecting the | |
| Edmund P. Harrigan Otis W. Brawley Katherine A. High Met 2 times in | |
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Proxy Statement | |
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| Board Committees | |
| | | | | | | | | | | | Committee Membership | | |||||||||
Name and Primary Occupation | | | Director Since | | | Age | | | Independent | | | Compensation | | | Audit and Finance | | | Nominating and Corporate Governance | | | Science and Technology | |
Hervé Hoppenot—Chairman of the Board President and Chief Executive Officer Incyte Corporation | | | 2014 | | | 62 | | | | | | | | | | | | | | | | |
Julian C. Baker—Lead Independent Director Managing Partner Baker Brothers Investments | | | 2001 | | | 55 | | | ✓ | | | | | | | | | | | | ||
Jean-Jacques Bienaimé Chief Executive Officer BioMarin Pharmaceutical Inc. | | | 2015 | | | 68 | | | ✓ | | | | | | | | | | | | ||
Otis W. Brawley, M.D. Bloomberg Distinguished Professor of Oncology and Epidemiology Johns Hopkins University | | | 2021 | | | 62 | | | ✓ | | | | | | | | | | | | | |
Paul J. Clancy Former Executive Vice President and Chief Financial Officer Alexion Pharmaceuticals, Inc. | | | 2015 | | | 60 | | | ✓ | | | | | | | | | | | | ||
Wendy L. Dixon, Ph.D.1 Former Chief Marketing Officer and President, Global Marketing Bristol-Myers Squibb Company | | | 2010 | | | 66 | | | ✓ | | | | | | | | | | | | | |
Jacqualyn A. Fouse, Ph.D. Chief Executive Officer Agios Pharmaceuticals, Inc. | | | 2017 | | | 60 | | | ✓ | | | | | | | | | | | | ||
Edmund P. Harrigan, M.D. Former Senior Vice President of Worldwide Safety and Regulatory Pfizer Inc. | | | 2019 | | | 69 | | | ✓ | | | | | | | | | | | | | |
Katherine A. High, M.D. President, Therapeutics Asklepios Biopharmaceutical, Inc. | | | 2020 | | | 70 | | | ✓ | | | | | | | | | | | | |
| | | Committee Chair | | | | | Financial Expert | | | | | Member | |
Committee Membership | ||||||||||||||
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Name and Primary Occupation | Director Since | Age | Independent | Compensation | Audit and Finance | Nominating and Corporate Governance | Science and Technology(1) | |||||||
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Hervé Hoppenot—Chairman of the Board President and Chief Executive Officer Incyte Corporation | 2014 | 61 | ||||||||||||
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Julian C. Baker—Lead Independent Director Managing Partner Baker Brothers Investments | 2001 | 54 | ||||||||||||
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Jean-Jacques Bienaimé Chief Executive Officer BioMarin Pharmaceutical Inc. | 2015 | 67 | ||||||||||||
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Paul J. Clancy Former Executive Vice President and Chief Financial Officer Alexion Pharmaceuticals, Inc. | 2015 | 59 | ||||||||||||
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Wendy L. Dixon, Ph.D. Former Chief Marketing Officer and President, Global Marketing Bristol-Myers Squibb Company | 2010 | 65 | ||||||||||||
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Jacqualyn A. Fouse, Ph.D. Chief Executive Officer Agios Pharmaceuticals, Inc. | 2017 | 59 | ||||||||||||
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Edmund P. Harrigan, M.D. Former Senior Vice President of Worldwide Safety and Regulatory Pfizer Inc. | 2019 | 68 | ||||||||||||
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Katherine A. High, M.D. President, Therapeutics Asklepios Biopharmaceutical, Inc. | 2020 | 69 | ||||||||||||
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Committee Chair Financial Expert Member
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Based on the Compensation Committee's most recent review in February 2021, the Compensation Committee recommended,we sought approval for, and in March 2021, the Boardour stockholders approved, changes to our non-employee director compensation program that enable the Board to set the grant date target value of equity awards under our Amended and Restated 2010 Stock Incentive Plan (the "2010“2010 Stock Incentive Plan"Plan”) that enable the Board to set the total grant date target value of equity awards to our non-employee directors up to a maximum of $500,000, which was the total grant date target value for equity awards made to non-employee directors in 2020.
In addition, the mix of equity awards was changed from 75% stock options and 25% restricted stock unit (RSU) awards to 60% stock options and 40% RSU awards. These changes will take effectFor 2021, the Board, upon the approvalrecommendation of amendmentsthe Compensation Committee, reduced the total grant date target value of non-employee director equity awards from $500,000 to $400,000. Based on the 2010 Stock Incentive Plan as described below under "Proposal 3,"Compensation Committee’s most recent review in November 2021, the Compensation Committee recommended, and are more fully described under "in November 2021, the Board approved, retaining the total grant date target value of non-employee director equity awards at $400,000 through at least the 2023 annual meeting of stockholders.Proposal 3."
Role | Cash Retainer ($)(1) | Total Equity Awards ($)(2) | |||||
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Lead Independent Director | 90,000 | 400,000 | |||||
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Non-Employee Director | 60,000 | 400,000 | |||||
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TableIn addition, in November 2021, based on the Compensation Committee’s review of Contentscompensation for non-employee directors of peer group companies, effective January 1, 2022, the Board increased the annual retainers for the Lead Independent Director from $90,000 to $100,000, the chair of the Nominating and Corporate Governance Committee from $16,000 to $18,000, members of the Audit and Finance Committee from $12,000 to $12,500 and members of the Nominating and Corporate Governance Committee from $8,000 to $9,000. All other annual retainers for committee membership and chair service remained the same.
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Role | | | Cash Retainer ($)(1) | | | Total Equity Awards ($)(2) | | ||||||
Lead Independent Director | | | | | 100,000 | | | | | | 400,000 | | |
Non-Employee Director | | | | | 60,000 | | | | | | 400,000 | | |
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| | Proxy Statement 2022|29 | |
| Compensation of Directors | |
Role | | | Cash Retainer ($)(1) | | |||
Chair of Audit and Finance Committee | |||||||
| | | | 25,000 | | | |
Members of Audit and Finance Committee | |||||||
| | | | 12,500 | | | |
Chair of Compensation Committee | |||||||
| | | | 25,000 | | | |
Members of Compensation Committee | |||||||
| | | | 10,000 | | | |
Chair of Nominating and Corporate Governance Committee | |||||||
| | | | 18,000 | | | |
Members of Nominating and Corporate Governance Committee | |||||||
| | | | 9,000 | | | |
Chair of Science and Technology Committee | |||||||
| | | | 25,000 | | | |
Members of Science and Technology Committee | |||||||
| | | | 10,000 | | |
Name | | | Fees Earned or Paid in Cash ($) | | | Stock Awards ($)(1)(3) | | | Option Awards ($)(2)(3) | | | Total ($) | | ||||||||||||
Julian C. Baker | | | | | — | | | | | | 275,917 | | | | | | 239,875 | | | | | | 515,792 | | |
Jean-Jacques Bienaimé | | | | | 69,750 | | | | | | 159,917 | | | | | | 239,875 | | | | | | 469,542 | | |
Otis W. Brawley | | | | | 652 | | | | | | 86,921 | | | | | | 130,461 | | | | | | 218,034 | | |
Paul J. Clancy | | | | | — | | | | | | 254,917 | | | | | | 239,875 | | | | | | 494,792 | | |
Wendy L. Dixon | | | | | — | | | | | | 231,917 | | | | | | 239,875 | | | | | | 471,792 | | |
Jacqualyn A. Fouse | | | | | — | | | | | | 239,917 | | | | | | 239,875 | | | | | | 479,792 | | |
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| Compensation | |
Name | | | Fees Earned or Paid in Cash ($) | | | Stock Awards ($)(1)(3) | | | Option Awards ($)(2)(3) | | | Total ($) | | ||||||||||||
Edmund P. Harrigan | | | | | — | | | | | | 229,917 | | | | | | 239,875 | | | | | | 469,792 | | |
Katherine A. High | | | | | 52,500 | | | | | | 159,917 | | | | | | 239,875 | | | | | | 452,292 | | |
Name | | Fees Earned or Paid in Cash ($) | | Stock Awards ($)(1)(3) | | Option Awards ($)(2)(3) | | Total ($) | | ||||||||||
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Julian C. Baker | | | — | | | | 242,508 | | | | 379,645 | | | 622,153 | | ||||
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Jean-Jacques Bienaimé | | | — | | | | 211,104 | | | | 379,645 | | | 590,749 | | ||||
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Paul J. Clancy | | | — | | | | 217,854 | | | | 379,645 | | | 597,499 | | ||||
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Wendy L. Dixon | | | — | | | | 198,508 | | | | 379,645 | | | 578,153 | | ||||
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Jacqualyn A. Fouse | | | — | | | | 206,508 | | | | 379,645 | | | 586,153 | | ||||
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Paul A. Friedman | | | 74,540 | | | | 126,508 | | | | 379,645 | | | 580,693 | | ||||
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Edmund P. Harrigan | | | — | | | | 191,155 | | | | 379,645 | | | 570,800 | | ||||
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Katherine A. High | | | 50,801 | | | | 136,662 | | | | 410,258 | | | 597,721 | | ||||
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Name | | | Value of Restricted Stock Awards ($) | | | Grant Date Fair Value of RSU Awards ($) | | ||||||
Julian C. Baker | | | | | 116,000 | | | | | | 159,917 | | |
Jean-Jacques Bienaimé | | | | | — | | | | | | 159,917 | | |
Otis W. Brawley | | | | | — | | | | | | 86,921 | | |
Paul J. Clancy | | | | | 95,000 | | | | | | 159,917 | | |
Wendy L. Dixon | | | | | 72,000 | | | | | | 159,917 | | |
Jacqualyn A. Fouse | | | | | 80,000 | | | | | | 159,917 | | |
Edmund P. Harrigan | | | | | 70,000 | | | | | | 159,917 | | |
Katherine A. High | | | | | — | | | | | | 159,917 | | |
Name | | Value of Restricted Stock Awards ($) | | Grant Date Fair Value of RSU Awards ($) | | ||||||
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Julian C. Baker | | | 116,000 | | | | 126,508 | | | ||
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Jean-Jacques Bienaimé | | | 84,596 | | | | 126,508 | | | ||
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Paul J. Clancy | | | 91,346 | | | | 126,508 | | | ||
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Wendy L. Dixon | | | 72,000 | | | | 126,508 | | | ||
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Jacqualyn A. Fouse | | | 80,000 | | | | 126,508 | | | ||
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Paul A. Friedman | | | — | | | | 126,508 | | | ||
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Edmund P. Harrigan | | | 64,647 | | | | 126,508 | | | ||
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Katherine A. High | | | — | | | | 136,662 | | | ||
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Name | | | Number of Unvested RSU Awards | | | Number of Shares Underlying Unexercised Option | | ||||||
Julian C. Baker | | | | | 1,923 | | | | | | 145,996 | | |
Jean-Jacques Bienaimé | | | | | 1,923 | | | | | | 120,996 | | |
Otis W. Brawley | | | | | 1,255 | | | | | | 5,910 | | |
Paul J. Clancy | | | | | 1,923 | | | | | | 120,996 | | |
Wendy L. Dixon | | | | | 1,923 | | | | | | 125,996 | | |
Jacqualyn A. Fouse | | | | | 1,923 | | | | | | 79,746 | | |
Edmund P. Harrigan | | | | | 1,923 | | | | | | 22,884 | | |
Katherine A. High | | | | | 1,923 | | | | | | 19,809 | | |
Name | | Number of Unvested RSU Awards | | Number of Shares Underlying Unexercised Option | | ||||||
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Julian C. Baker | | | 1,282 | | | | 157,986 | | | ||
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Jean-Jacques Bienaimé | | | 1,282 | | | | 112,986 | | | ||
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Paul J. Clancy | | | 1,282 | | | | 112,986 | | | ||
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Wendy L. Dixon | | | 1,282 | | | | 137,986 | | | ||
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Jacqualyn A. Fouse | | | 1,282 | | | | 71,736 | | | ||
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Paul A. Friedman | | | 1,282 | | | | 105,486 | | | ||
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Edmund P. Harrigan | | | 1,282 | | | | 14,874 | | | ||
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Katherine A. High | | | 1,282 | | | | 11,799 | | | ||
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Proxy Statement | |
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What We Do | | ||||
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✓ Majority voting for directors in uncontested elections | | | ✓ Audit and Finance Committee receives semiannual updates by our Chief Compliance Officer | | |
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✓ Strong and active Lead Independent Director, representing one of our largest stockholders | | | ✓ Board and the committees may seek advice from outside advisors | | |
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✓ Audit and Finance Committee, Nominating and Corporate Governance Committee and Compensation Committee comprised solely of independent directors | | | ✓ Pre-clearance by our General Counsel required for trading in our stock by any director, and all executive trading must be through a pre-cleared trading plan | | |
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✓ Audit and Finance Committee regularly meets with Ernst & Young LLP, our independent registered public accounting firm, as well as our corporate audit services team—without members of executive management present | | | ✓ Maintain robust Code of Business Conduct and Ethics, Senior Financial | | |
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✓ An independent compensation consultant is engaged by and reports directly to our Compensation Committee | | | ✓ Board members have complete access to management and employees in their discretion | | |
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✓ Annual election of directors | | | ✓ High Board and committee attendance | | |
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✓ Review and approve corporate strategic plan, including the budget, at least annually | | | ✓ Robust commitment to corporate, environmental and social responsibility | | |
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✓ Limits on outside board and audit committee service | | | ✓ Extensive ongoing stockholder outreach, often involving Lead Independent Director | | |
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✓ Proxy access bylaw (3% ownership, 3 years, nominees up to 20% of the Board) | | | ✓ Audit and Finance Committee is updated by our cybersecurity team at least twice per year | |
| What We Don’t Do | | |||
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| | | ✗ No hedging or speculative trading in our stock by directors, executives or other employees | |
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✗ No plurality voting in uncontested Board elections | | | ✗ Board members may not be | |
“overboarded” | |
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Our Bylaws include a majority voting standard for the election of directors. In order to receive a majority of the votes cast, the number of shares voted "FOR"“FOR” must exceed the number of votes "AGAINST"“AGAINST”; abstentions and broker non-votes do not count as votes cast. Our Bylaws provide that, in an uncontested election, director nominees must receive a majority of the votes cast to be elected to the Board. Our Corporate Governance Guidelines state that if a nominee for director in an uncontested election does not receive a majority of the votes cast, the director should submit a resignation for consideration by the Board. The Nominating and Corporate Governance Committee will evaluate and make a recommendation to the Board with respect to the proffered resignation. The Board must take action on the recommendation within 90 days following certification of the stockholder vote. The director whose resignation is under consideration cannot participate in any decision regarding his or her resignation. The Nominating and Corporate Governance Committee and the Board may consider any factors they deem relevant in deciding whether to accept a director'sdirector’s resignation.
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| Corporate Governance | |
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circumstances existing at the time. As such, the Board periodically evaluates whether combining or separating the roles of Chairman and CEO is in the best interestsinterest of the Company and of our stockholders.
| | | Proxy Statement 2022|33 | |
| Corporate Governance | |
Director Independence |
In 2020,2021, our Board determined that each individual who served as a member of the Board in 2020,2021 except for Mr. Hoppenot, was an "independent director"“independent director” within the meaning of Rule 5605 of The Nasdaq Stock Market.
Board Evaluation |
Our Board—in conjunction with our Nominating and Corporate Governance Committee, which is chaired by our Lead Independent Director—regularly reviews its competencies and areas of expertise in light of the current and future goals, strategies and challenges of our Company. As our Board has done three times in the last four years, when it sees a current or potential need our Board undertakes a thorough search for new directors. As part of this self-assessment,Refreshment
The Board considers at least annuallycomposition, taking into consideration: the knowledge, experience and diverse perspectives of directors,its directors; each individual director'sdirector’s performance and contributions to the work of the Board and its committees,committees; the personal circumstances and other time commitments of directors, along withdirectors; and other factors the Board deems appropriate, such as independence, absence of conflicts and lack of any reputational risks. The Board weighs these factors with the needs of our BoardIncyte’s priorities and its committees based on Incyte's current strategy and risk profile.needs. Our directors serve one-year terms, and all continuing directors are subject to our stockholders'stockholders’ votes every year.
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has significant executive, scientific and medical leadership experience, including extensive academic and industry experience in drug discovery and development. Her medical background, together with her experience leading drug discovery and development efforts, are expected to assist the Board in its oversight role over our drug discovery and development efforts.
as well as into healthcare delivery.
| | | Relevant Experience | | |||||||||||||||||||||||||||
Director | | | Executive/ Industry | | | Drug Discovery | | | Clinical Development | | | Regulatory | | | Business Development | | |||||||||||||||
Otis W. Brawley, M.D. | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | | | |
Edmund P. Harrigan, M.D. | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | |
Katherine A. High, M.D. | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | | | |
| 34|Proxy Statement 2022 | | | |
| Corporate Governance | |
Expertise | | | Hoppenot | | | Baker | | | Bienaimé | | | Brawley | | | Clancy | | | Fouse | | | Harrigan | | | High | | |||||||||||||||||||||
Biopharma Industry | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | ✓ | |
Operational Leadership | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | ✓ | |
International | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | ✓ | |
Drug Discovery, Development & Regulatory | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | | | | | | | ✓ | | | | ✓ | |
Commercial | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | | | | | | | | | | | | | ✓ | | | | | | | | | | | |
Financial | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | | | | | | |
Additional Information | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
PhD/MD | | | | | | | | | | | | | | | | | | | | | | | ✓ | | | | | | | | | | | | ✓ | | | | | | ✓ | | | | ✓ | |
Attendance | | | | | 100% | | | | | | 100% | | | | | | 93% | | | | | | 100% | | | | | | 100% | | | | | | 100% | | | | | | 88% | | | | 100% | |
Independence | | | | | | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | | | ✓ | | | | ✓ | |
Expertise | Hoppenot | Baker | Bienaimé | Clancy | Dixon | Fouse | Harrigan | High | ||||||||
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Biopharma Industry | ||||||||||||||||
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Operational Leadership | ||||||||||||||||
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International | ||||||||||||||||
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Drug Discovery, Development & Regulatory | ||||||||||||||||
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Commercial | ||||||||||||||||
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Financial | ||||||||||||||||
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Additional Information | ||||||||||||||||
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PhD/MD | ||||||||||||||||
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Attendance | 100% | 100% | 100% | 100% | 100% | 100% | 88% | 100% | ||||||||
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Independence | ||||||||||||||||
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ThreeWe believe having a diverse group of directors with different experiences and skills as well as broad representation benefits the interests of all Incyte stakeholders. Two of our eight Board nominees are women, representing 38%25% of our Board of Directors. This compares well with the 2021 average among S&P 500 constituents, wherein 28%in which 29% of all Board seats are currently taken by women. Two (25%) of our directors were also born outside of the United Statesin Europe, one self-identifies as Black/African American and one self identifiesself-identifies as LGBTQ+, further reflecting the diversity of our Board. Currently, 100% of our Board nominees self-identify as white.
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| Corporate Governance | |
All of our Board nominees are currently compliant with this policy.
| Hoppenot2 | | | Baker | | | Bienaimé2 | | | Brawley | | | Clancy | | | Fouse2 | | | Harrigan | | | High | |
| 2 | | | 3 | | | 2 | | | 4 | | | 4 | | | 2 | | | 3 | | | 2 | |
Number of Total Public Board Commitments1 | ||||||||||||||
Hoppenot2 | Baker | Bienaimé2 | Clancy | Dixon | Fouse2 | Harrigan | High | |||||||
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2 | 3 | 2 | 3 | 4 | 2 | 3 | 2 | |||||||
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Director Nominations |
The Board nominates directors for election at each annual meeting of stockholders and elects new directors to fill vacancies when they arise. The Board has as an objective, set forth in our Corporate Governance Guidelines, that its membership be composed of experienced and dedicated individuals with diversity of backgrounds, perspectives and skills. The Nominating and Corporate Governance Committee has the responsibility to identify, evaluate, recruit and recommend qualified candidates to the Board for nomination or election.
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nominees for election to our Board, in addition to the diverse set of skills and experience the Board collectively represents.
| 36|Proxy Statement 2022 | | | |
| Corporate Governance | |
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date of the preceding year'syear’s annual meeting of stockholders, notice by the stockholder to be timely must be so received by the Secretary of the Company not later than the close of business on the later of (1) the 90th day prior to the date of the meeting and (2) the 10th day following the first public announcement or disclosure of the meeting date. Information required by the Bylaws to be in the notice include the name and contact information for the candidate and the person making the nomination and other information about the nominee that must be disclosed in proxy solicitations under Section 14 of the Securities Exchange Act of 1934 and the related rules and regulations under that Section.
| | | Proxy Statement 2022|37 | |
| Corporate Governance | |
Board Meetings |
The Board held six meetings during 2020—2021—four regularly scheduled meetings and two other meetings. All directors attended all four regularly scheduled meetings held by the Board. Overall, each director attended at least 88% of the meetings held by the Board and the committees on which he or she served during 2020.
2021.
Corporate Governance Guidelines |
The Board is committed to sound and effective corporate governance practices. Accordingly, the Board has adopted Corporate Governance Guidelines, which are intended to describe the governance principles and procedures by which the Board functions. The guidelines are subject to periodic review and update by the Nominating and Corporate Governance Committee and the Board, and were most recently amended in November 2017.February 2022. These Guidelines can be found on our website at http://www.incyte.com under the "Corporate Governance"“Corporate Governance” heading in the "For Investors"“For Investors” portion of our website.
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| 38|Proxy Statement 2022 | | | |
| Corporate Governance | |
Communications with the Board |
If you wish to communicate with the Board, you may send your communication in writing to:
Certain Relationships and Related Transactions |
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2020
We reported total productProduct and royalty revenues grew 17% year-over-year to $2.9 billion, driven by growth across all products commercialized by Incyte as well as Incyte products commercialized by our partners. During the year, we achieved 5 regulatory approvals across the U.S., Europe and Japan. These launches are currently underway and are expected to contribute more meaningfully to revenue going forward.
Net sales ofJakafi
New productindications in myelofibrosis, polycythemia vera and graft-versus-host disease (GVHD). In the fourth quarter, Jakafi received approval of its fourth indication for the treatment of patients with steroid-refractory chronic GVHD.
Wewe receive royalties on Jakavi®Jakavi
| | | Proxy Statement 2022|41 | |
| Executive Compensation | |
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We operate in two therapeutic areas that are defined by the indications of our approved medicines2021 and the diseases for which our clinical candidates are being developed. The first therapeutic area is Hematology/Oncology, which is comprised of Myeloproliferative Neoplasms (MPNs)YTD Regulatory and Graft-Versus-Host Disease (GVHD), as well as solid tumorsClinical Achievements
Weyear-to-date, we achieved numerous important milestones in 2020 and during 2021 to date, and thesemilestones. These are summarized in the graphic below and described in more detail thereafter.
| 42|Proxy Statement 2022 | | | |
| Executive Compensation | |
AD = atopic dermatitis; GVHD = graft-versus-host disease; MF = myelofibrosis; DLBCL = diffuse large B-cell lymphoma; CCA = cholangiocarcinoma; BTC = biliary tract cancer; SCACcarcinoma; AAD = squamous cell anal carcinoma; NHLAmerican Academy of Dermatology; MAA = non-Hodgkin lymphoma;Marketing Authorization Application; EMA = European Medicines Agency; NSCLC = non-small cell lung cancer; AD = atopic dermatitis; IAI = inflammationcancer.
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The REACH3 Phase 3 trial of ruxolitinib in patients with steroid-refractory chronic GVHD met its primary endpoint of superior overall response rate at month 6 and achieved statistically significant and clinically meaningful improvements in both key secondary endpoints, the modified LeeSeptember 2021. There are approximately 14,000 patients living with chronic GVHD symptom scale and failure free survival. The safety profilein the U.S., of ruxolitinib was consistent with previously reported studies of ruxolitinib in GVHD.
The success of the REACH3 trial represents the largest randomized pivotal trial with positive results in this patient population, as was the success of the randomized REACH2 trial in patients with acute GVHD, as
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described last year. The sNDA seeking FDA approval of ruxolitinib in patients with steroid-refractory chronic GVHD is now under Priority Review at the FDA with a decision expected in June 2021.
We are alsoOur Leadership In MPNs Beyond Ruxolitinib (LIMBER) program focuses on developing multiple programs beyond ruxolitinib monotherapynew therapies to improve and expand upon available therapeutic options for patients living with myeloproliferative neoplasms (MPNs) as part of our Leadership In MPNs BEyond Ruxolitinib (LIMBER) initiative. We are evaluating combinations of ruxolitinib with other therapeutic modalities, as well as developing a once-a-day formulation of ruxolitinib for potential use as monotherapy and combination therapy. This new formulation ofMPNs. Parsaclisib (PI3Kδ) plus ruxolitinib is being evaluated in pivotal trials (1L and inadequate responders), and INCB57643 (BET) and INCB00928 (ALK2) combination trials with ruxolitinib are in proof-of-concept. Once-a-day (QD) ruxolitinib is currently in stability testing and is expected to be submitted to the FDA early next year,for approval in the first half of this year.
| | | Proxy Statement 2022|43 | |
| Executive Compensation | |
Basedbased on positivedata, including overall response rate, from the Phase 2 data presented in 2020, we have opened two pivotal trialsL-MIND study, a single-arm trial of ruxolitinibMonjuvi in combination with parsaclisib (PI3Kd) in first-line myelofibrosis (MF; LIMBER-313) and in MF patients withlenalidomide as a suboptimal response to ruxolitinib monotherapy (LIMBER-304).
Additional Phase 2 trials combining ruxolitinib with investigational agents from our portfolio such as INCB57643 (BET) and INCB00928 (ALK2) in patients with MF are in preparation, and additional discovery and development initiatives are also ongoing within the LIMBER program, which are evaluating both internally-discovered compounds, including itacitinib (JAK1), and candidates from collaboration partners.
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Momentum is strong behind the U.S. launch of Monjuvi, with good uptake in both academic and community settings and illustrated by the market share gained in the first several months since launch.
Updated data from L-MIND form part of the data dossier submitted to the European Medicines Agency (EMA) seeking approval of Monjuvi in Europe for the treatment ofadult patients with r/r DLBCL.
We Monjuvi’s launch is ongoing in the U.S. and uptake continues to increase in the second-line DLBCL setting, with continued penetration into new accounts.
The U.S. launch of Pemazyre has been successful and, in March, we announced that Pemazyre was approved in both Europe and Japan. The European Commission approved Pemazyre for the treatment of adults with unresectable locally advanced or metastatic cholangiocarcinoma with an FGFR2 fusion or rearrangement that is relapsed or refractory, after at least one line of systemic therapy and was approved in Japan for the treatment of patients with unresectable biliary tract cancer (BTC) with a fibroblast growth factor receptor 2 (FGFR2) fusion gene, worsening after cancer chemotherapy.
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In addition to our commercialized product portfolio, we also have late-stage assets under development.
In December 2020, data from three ongoing Phase 2 studies evaluatingOur oral PD-L1 program, which includes parsaclisib (PI3Kd)INCB86550, INCB99280 forand INCB99318, was the treatment of patients with relapsed or refractory follicular (CITADEL-203), marginal zone (CITADEL-204) and mantle cell (CITADEL-205) lymphomas were presented at ASH 2020. Data from the CITADELfirst to ever demonstrate clinical activity. We expect to make a lead program are expected to form the basis of an NDA seeking FDA approval of parsaclisib, whichselection later this year.
In January 2021, we announced that the FDA had accepted for Priority Review our Biologics License Application (BLA) for retifanlimab (PD-1)a Phase 3 trial (POD1UM-303) as a treatment for previously treated patients with advanced squamous cell carcinoma of the anal canal (SCAC) who have progressed following standard platinum-based chemotherapy. The FDA decisionIn addition, retifanlimab is expectedbeing evaluated as a first line therapy in July 2021. The BLA submission was based on data from the Phase 2 POD1UM-202 trial evaluating retifanlimab in previously treatedcombination with platinum-based chemotherapy as a treatment for patients with advanced SCAC who have progressed following standard platinum-based chemotherapy; the Phase 3 POD1UM-303 trial in patients with SCAC is underway.NSCLC.
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| Executive Compensation | |
RuxolitinibOpzelura™ (ruxolitinib) cream is a potent, selective inhibitor of JAK1 and JAK2 that provides the opportunity was launched on October 11, 2021 for mild to directly target diverse pathogenic pathways that underlie certain dermatologic conditions, includingmoderate atopic dermatitis which(AD) and is a form of eczema, andpending regulatory approval for vitiligo.
The Phase 3 TRuE-AD program of ruxolitinib cream in patients with atopic dermatitis was successful and the NDA seeking FDA approval in this indication was submitted in December 2020. The submission was granted Priority Review and the FDA decision is expected in June 2021.
If approved, we expect the initial uptake of ruxolitinib cream to be driven by specialists in medical dermatology and allergy.
Thepresented positive Phase 3 TRuE-V trials24-week results of
Phase 2 studies for hidradenitis suppurativa, prurigo nodularis and vitiligo. There is significant potential with each of these indications where there are limited treatment options, or in some cases, no FDA-approved therapies.
Partnered Programs (Incyte is eligible for royalties and milestone payments) |
We participate in multiple collaborative partnerships in which we are eligible for milestone payments and royalties on certain Incyte-discoveredIncyte discovered products that we licensed to third parties. TheseCurrently, our key commercialized products include Jakavi®Jakavi
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(ruxolitinib) and Tabrecta®Tabrecta® (capmatinib), which are licensed to Novartis, and Olumiant®Olumiant® (baricitinib), which is licensed to Eli Lilly and Company.
With
During 2020, Novartis also announced U.S.respectively. In March 2022, the EMA’s Committee for Medicinal Products for Human Use (CHMP) issued a positive opinion recommending approval of ruxolitinib for the treatment of patients aged 12 and Japanese approvals of Tabrecta for certain patientsolder with non-small cell lung cancer, and intends to submit for approval in Europe during 2021. Tabrecta was discovered by Incyte and global rights were licensed to Novartis in 2009.
During 2020, Lilly announced that Olumiant has been approved in both Europe and Japansteroid-refractory acute graft-versus-host disease or chronic graft-versus-host disease. Capmatinib is under review at the EMA as a treatment for certain patients with atopic dermatitis,NSCLC and expects to announcein April 2022, the FDA decision on its sNDA seekingCHMP issued a positive opinion recommending approval of Olumiantcapmatinib for atopic dermatitis during 2021.
the treatment of adults with metastatic non-small cell lung cancer whose tumors have a mutation that leads to METex14.
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During 2020, we sought to engage directly, or indirectly through our proxy solicitor, D. F. King & Co.,
| Executive Compensation | |
In our outreachaddress unmet needs of patients and to ultimately be able to make a meaningful difference in the falllives of 2020,patients and their caregivers. The chart below summarizes our clinical stage programs.
| 46|Proxy Statement 2022 | | | |
| Executive Compensation | |
| Each year, we conduct stockholder outreach to gather direct feedback on our corporate governance, compensation practices and environmental, social and governance (ESG) practices. Since 2018, we have contacted stockholders who represent the top 80% of our shares outstanding. As a result of our annual stockholder engagement, we have implemented several significant enhancements in our corporate governance, compensation policies, ESG activities and stockholder communication practices. The following changes were made in response to feedback received: | | | ANNUAL OUTREACH TO STOCKHOLDERS: 80% OF SHARES OUTSTANDING | |
Action | | | Year of Implementation | |
Governance | | |||
✓ Adopted a proxy access bylaw | | | 2021 | |
✓ Adopted equity ownership guidelines | | | 2016, amended 2021 | |
✓ Adopted a director overboarding policy | | | 2020 | |
Compensation | | |||
✓ Adjusted the executive compensation pay mix to include higher percentages of performance shares | | | Performance Shares added in 2018; increased % of performance shares in 2020 and 2022 | |
✓ Established a three-year performance period for our CEO and other U.S.-based executive officers | | | 2020 | |
✓ Restructured director pay to be based on a set target value instead of fixed share grants | | | 2019 | |
✓ Eliminated special option grants to the CEO | | | 2019 | |
✓ Added enhanced disclosure on certain items such as goal achievement | | | 2017 | |
ESG | | |||
✓ Added ESG goals to our Annual Incentive Plan | | | 2022 | |
✓ Disclosed ethnic and racial diversity data for U.S. workforce | | | 2021 | |
✓ Enhanced ESG disclosure | | | 2019 | |
| | | Proxy Statement 2022|47 | |
| Executive Compensation | |
Feedback in 2020 waslargely positive, with investors pleased withexpressing support for the progress Incyte has made in recent yearsyears. We believe that our current compensation structure, as described in response to these investor engagements.more detail in subsequent pages of this Proxy Statement, strikes the right balance of motivation and retention for our executives. The graphic below shows the evolution of our executive compensation structure over the last threeseveral years.
We believe that our current compensation structure strikes the right balance of motivation and retention for our executives, and feedback from investors was consistent with keeping the structure largely unchanged for 2021.
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Note that long-term compensation vests over 4 years. |
The Compensation Committee considered the result of the stockholder advisory voteDiscussion and direct feedback from investors as supportive of its overall compensation policies, practices and philosophy for our executive officers and has decided to maintain the same overall executive compensation structure for 2021, with the exception of:
The Compensation Committee intends to continue to regularly review, assess and, when appropriate, adjust our compensation practices based on feedback from our stockholders or other determinations informed by best practices and trends.
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Below is a comprehensive list of our compensation policies includingand policy enhancements that we have made in our continuing effort to be responsive to issues discussed during our stockholder outreach over the last five years as well asand to address advice of "stockholderprovided by stockholder advisory firms."
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What We Do | | ||||
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✓ We pay for performance, including having a | | | ✓ We have | | |
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✓ 30% of | | | ✓ Our Compensation Committee uses an independent compensation consultant, Compensia, and considers peer groups in establishing executive compensation | | |
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✓
Performance shares have a three-year performance period | | | ✓ Robust anti-hedging and anti-speculation policies in place | | |
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✓ Robust stock ownership guidelines for our CEO, executive officers and our directors | | | ✓ Our Compensation Committee is comprised of all independent directors | | |
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✓ Double-trigger equity vesting in the event of a change-in-control | | | ✓ We conduct an annual say-on-pay vote | | |
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✓ Equity awards have a minimum vesting period of 12 | | | ✓ We engage proactively with our stockholders throughout the year | |
| 48|Proxy Statement 2022 | | | |
| Executive Compensation | |
| What We Don’t Do | | |||
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| | | ✗ We do not provide golden parachute excise tax gross-ups | |
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✗ We do not provide single-trigger equity vesting in the event of a change-in-control | | | ✗ We do not provide | |
for executives | |
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The performance-based components and time-based components of our equity compensation program are designed to encourage both an appropriate level of risk-taking and a focus on sound long-term decision-making, thus aligning executive interests with the long-term best interests of our Company and our stockholders.
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The Compensation Committee of our Board believes that the compensation of our executive officers should:
| | | Proxy Statement 2022|49 | |
| Executive Compensation | |
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As the design of our executive compensation program shows, the Compensation Committee believes that executive compensation should be designed to pay for performance. Our Company has made great progress in recent years, and executive compensation has reflected that performance.
CEO Compensation versus Peers |
| 50|Proxy Statement 2022 | | | |
| Executive Compensation | |
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Implementing Our executive compensation program is designed so that a substantial portionObjectives—Role of the pay of our ChairmanCompensation Committee and Our Chief Executive Officer is delivered in the form of long-term incentives – which means that most of Mr. Hoppenot's Realizable Compensation (meaning, cash actually received during any year and the actual value of that year's equity grants as measured on December 31 of that year) is tied directly to our stock price performance and achievement of our long-term goals. Mr. Hoppenot's compensation, as reported in the Summary Compensation Table on page 68, reflects the accounting value of long-term incentives at grant and not the value actually received from these grants or their potential future value that may actually be realized.
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We believe that it is useful to compare Mr. Hoppenot's Realizable Compensation between 2018 and 2020 with his Summary Compensation Table compensation for the same period as illustrated in the chart below.
Target Compensation reflects base salary, target bonus under the annual incentive compensation plan, and the value of stock and option awards as shown in the Summary Compensation Table, with the value of PSUs in 2018-2020 based on their target number of shares, not the amount of PSUs actually earned; Realizable Compensation includes the same elements but reflects the actual bonus paid under the annual incentive compensation plan, the number of PSUs earned in 2018 and 2019 (1 year performance period) and the target number of PSUs for 2020 (3 year performance period) at an $86.98 price.
Realizable Compensation reflects realizable values for equity granted during the applicable calendar year, calculated as of December 31 of such year, and includes:
The lower Realizable Compensation for each of the three years is the result of a combination of lower stock price, underwater stock options, and short term incentive awards that were, in some cases, earned below target. The Compensation Committee has designed Mr. Hoppenot's compensation to ensure that his Realizable Compensation is closely tied to our stock price performance. Our Compensation Committee believes that its pay for performance compensation strategy is working as intended and is best evaluated by examining Realizable Compensation, rather than solely the accounting compensation set forth in the Summary Compensation Table.
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The Compensation Committee approves, administers and interprets our executive compensation and benefits policies, including our 2010 Stock Incentive Plan. The Compensation Committee evaluates the performance of our CEO and determines his compensation in light of the goals and objectives of our compensation program. Our CEO and the Compensation Committee together assess the performance of our other executive officers and determine their compensation, based on initial recommendations from our CEO.
Role of the Independent Compensation Consultant |
Under its charter, the Compensation Committee has the sole authority to retain any independent compensation consultant or other advisor as the Committee may deem appropriate. Pursuant to this authority, the Compensation Committee has engaged Compensia, a national compensation consulting firm, for support on matters related to the compensation of our executive officers. Compensia does not provide any other services to our Company.
Market Reference Data |
| | | Proxy Statement 2022|51 | |
| Executive Compensation | |
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The following table shows Incyte versus the 20212022 peer group on 20202021 total revenue, total employees, and market capitalizations (market cap). All data is as of December 31, 2020.
Company | | | Total Revenue ($M) | | | Company | | | Total Employees | | | Company | | | Market Cap ($M) | | |||||||||
Gilead | | | | | 27,305 | | | | Gilead | | | | | 14,400 | | | | Gilead | | | | | 91,081 | | |
Regeneron | | | | | 16,072 | | | | Regeneron | | | | | 10,368 | | | | Regeneron | | | | | 67,916 | | |
Biogen | | | | | 10,982 | | | | Biogen | | | | | 9,610 | | | | Vertex | | | | | 55,834 | | |
Vertex | | | | | 7,574 | | | | Vertex | | | | | 3,900 | | | | Biogen | | | | | 35,243 | | |
Jazz | | | | | 3,094 | | | | Jazz | | | | | 3,200 | | | | SeaGen | | | | | 28,270 | | |
Incyte | | | | | 2,986 | | | | BioMarin | | | | | 3,045 | | | | Alnylam | | | | | 20,282 | | |
BioMarin | | | | | 1,846 | | | | SeaGen | | | | | 2,675 | | | | BioMarin | | | | | 16,220 | | |
SeaGen | | | | | 1,574 | | | | Alkermes | | | | | 2,211 | | | | Incyte | | | | | 16,213 | | |
Exelixis | | | | | 1,435 | | | | Incyte | | | | | 2,094 | | | | Neurocrine | | | | | 8,080 | | |
Alkermes | | | | | 1,174 | | | | Alnylam | | | | | 1,665 | | | | Sarepta | | | | | 7,841 | | |
Neurocrine | | | | | 1,134 | | | | Exelixis | | | | | 954 | | | | Jazz | | | | | 7,831 | | |
Alnylam | | | | | 844 | | | | Neurocrine | | | | | 900 | | | | Exelixis | | | | | 5,784 | | |
Ionis | | | | | 810 | | | | Sarepta | | | | | 840 | | | | Ionis | | | | | 4,297 | | |
Sarepta | | | | | 702 | | | | Ionis | | | | | 660 | | | | Alkermes | | | | | 3,761 | | |
Amarin | | | | | 583 | | | | Amarin | | | | | 560 | | | | Sage | | | | | 2,506 | | |
Sage | | | | | 6 | | | | Sage | | | | | 471 | | | | Amarin | | | | | 1,337 | | |
Company | Total Revenue ($M) | Company | Total Employees | Company | Market Cap ($M) | |||||||||
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Gilead | 24,689 | Gilead | 13,600 | Gilead | 73,031 | |||||||||
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Biogen | 13,445 | Regeneron | 9,123 | Vertex | 61,457 | |||||||||
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Regeneron | 8,497 | Biogen | 9,100 | Regeneron | 51,551 | |||||||||
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Vertex | 6,206 | Alexion | 3,837 | Biogen | 37,679 | |||||||||
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Alexion | 6,070 | Vertex | 3,400 | Alexion | 34,173 | |||||||||
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Incyte | 2,667 | BioMarin | 3,059 | SeaGen | 31,579 | |||||||||
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Jazz | 2,364 | Alkermes | 2,245 | Incyte | 19,048 | |||||||||
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SeaGen | 2,176 | SeaGen | 2,092 | BioMarin | 15,918 | |||||||||
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BioMarin | 1,861 | Jazz | 1,940 | Alnylam | 15,100 | |||||||||
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Sage | 1,114 | Incyte | 1,773 | Sarepta | 13,454 | |||||||||
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Neurocrine | 1,046 | Alnylam | 1,453 | Jazz | 9,196 | |||||||||
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Alkermes | 1,039 | bluebird bio | 1,213 | Neurocrine | 8,955 | |||||||||
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Exelixis | 988 | Amarin | 1,000 | Ionis | 7,906 | |||||||||
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Ionis | 729 | Sarepta | 866 | Exelixis | 6,227 | |||||||||
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Amarin | 614 | Neurocrine | 845 | Sage | 4,502 | |||||||||
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Sarepta | 540 | Exelixis | 773 | Alkermes | 3,175 | |||||||||
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Alnylam | 493 | Ionis | 757 | Agios | 3,001 | |||||||||
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bluebird bio | 251 | Agios | 562 | bluebird bio | 2,872 | |||||||||
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Agios | 203 | Sage | 298 | Amarin | 1,901 | |||||||||
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In July 2016, the Compensation Committee, after consulting with Compensia with respect to peer group practices, revised our equity grant guidelines. In 2016 and 2017, 75% of the value of an executive officer's annual equity-based incentive awards were in the form of stock options while the remaining 25% were in the form of restricted stock units (RSUs).
In response to stockholder feedback, in 2018, the Compensation Committee changed the RSU portion to performance share awards, which combine the time-based vesting aspects of RSUs with a performance-based vesting requirement, resulting in 75% of the value being in the form of stock options and 25% in performance share awards.
In 2019, the Compensation Committee noted Compensia'sCompensia’s observation that our mix for executives of 75% stock options and 25% performance shares put our executives'executives’ equity-based compensation more at-risk than our peer group and the broader market norm and that, on average, our peers deliver approximately 25% of executive equity compensation value in the form of time-based vesting RSUs, with approximately 50% being delivered in the form of stock options and approximately 25% being delivered in the form of performance-based shares or options. The Committee also noted that, due to our stock price decline and limited use of RSUs, realizable compensation for our executives for 2016 through 2018 fell well below target compensation values. Accordingly, to enhance executive retention and bring our executive equity compensation practices in line with our peers, the Committee determined that, for 2019, our executives would receive 50% of their total grant date target value in the form of stock options, 25% in the form of performance shares, and 25% in the form of RSUs.
| 52|Proxy Statement 2022 | | | |
| Executive Compensation | |
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discussed below under "Key“Key Elements of Executive Compensation – Compensation—
awards, no outstanding merit awards were made to any executive officer in January 2022 for prior year performance.
Compensation Practices and Policies |
Equity Ownership Guidelines. Effective January 1, 2016, our Board adopted robust equity ownership guidelines for members of senior management, including our executive officers, and members of the Board. The guidelines
| | | Proxy Statement 2022|53 | |
| Executive Compensation | |
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Equity Ownership Requirements | | ||||
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6x Annual Base Salary | | ||||
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All Other Executive Officers | | | 3x Annual Base Salary | | |
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Non-Employee Members of the Board | | | 6x Annual Cash Retainer | ||
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Covered individuals as of January 1, 2016 must have satisfied these guidelines by December 31, 2020, and individuals who subsequently become subject to the guidelines will have five years to reach their ownership requirements. Shares held directly, shares held indirectly, such as by a trust or a 401(k) plan, unvested restricted shares and RSUs, and earned performance shares underlying vested stock optionsthat remain subject to service-based vesting requirements are included in determining an individual'sindividual’s equity ownership. Unvested stockStock options (whether vested or unvested) and unearned performance shares are not counted toward meeting these guidelines.
Prior to the 2021 guideline amendments, shares underlying vested stock options were included in determining equity ownership. For purposes of these guidelines, a non-employee director’s annual cash retainer does not include cash retainers for committee service.
Tax Deductibility of Compensation |
Section 162(m) of the Internal Revenue Code places a limit of $1,000,000 on the amount of compensation that we may deduct in any one year with respect to our CEO and each of the next three most highly compensated executive officers (excluding the chief financial officer for taxable years prior to 2018). Section 162(m) historically permitted deductions in excess of $1,000,000 for "performance-based“performance-based compensation,"” which included stock options meeting certain requirements, but the exception for "performance-based compensation"“performance-based compensation” has been repealed effective for taxable years beginning after December 31, 2017.
| 54|Proxy Statement 2022 | | | |
| Executive Compensation | |
Key Elements of Executive Compensation |
Our executive officers'officers’ compensation currently includes three primary components: base salary, cash bonus, and long-term equity-based incentive awards. Of these components, only base salary is not tied directly and meaningfully to our Company'sCompany’s performance because base salary is intended to attract and retain key talent by providing a stable source of income. In addition, we provide our executive officers a variety of benefits that are available generally to all salaried employees. Each of these components is described in more detail below.
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Base salaries are designed to attract and retain qualified personnel by providing a consistent cash flow throughout the year as compensation for acceptable levels of performance of day-to-day responsibilities. Base salaries for our executive officers are established based on the scope of their responsibilities, their performance, and their prior relevant background, training and experience, taking into account competitive market compensation paid by the companies represented in the compensation data we review for similar positions and the overall market demand for those executive officers at the time of hire. The Compensation Committee reviews salaries on an annual basis. At such time, the Compensation Committee may change each executive officer'sofficer’s salary based on the individual'sindividual’s contributions and responsibilities over the prior twelve months and any change in competitive market pay levels.
In January 2020, the Compensation Committee set the 2020 base salaries for our executive officers. The Committee considered our Company's performance in 2019, including our commercial operations, clinical trial progress of our other drug candidates, job performance, internal pay alignment and equity, marketplace competitiveness and the 2020 peer group data in determining the base salaries for 2020.
Name | | | 2021 Base Salary | | | 2022 Increase | | | 2022 Base Salary | | |||||||||
Hervé Hoppenot | | | | $ | 1,143,444 | | | | | | 8.0% | | | | | $ | 1,234,920 | | |
Christiana Stamoulis | | | | $ | 605,640 | | | | | | 8.0% | | | | | $ | 654,092 | | |
Steven H. Stein | | | | $ | 636,695 | | | | | | 18.0% | | | | | $ | 751,301 | | |
Barry P. Flannelly | | | | $ | 530,882 | | | | | | 8.0% | | | | | $ | 573,353 | | |
Maria E. Pasquale | | | | $ | 546,364 | | | | | | 8.0% | | | | | $ | 590,074 | | |
Name | | 2020 Base Salary | | 2021 Increase | | 2021 Base Salary | | |||||
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Hervé Hoppenot | | $ | 1,099,465 | | | 4.0 | % | | $ | 1,143,444 | | |
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Christiana Stamoulis | | $ | 588,000 | | | 3.0 | % | | $ | 605,640 | | |
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Barry P. Flannelly | | $ | 482,620 | | | 10.0 | % | | $ | 530,882 | | |
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Steven H. Stein | | $ | 578,813 | | | 10.0 | % | | $ | 636,695 | | |
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Vijay Iyengar | | $ | 553,499 | | | 3.0 | % | | $ | 570,104 | | |
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Each year, we have established an incentive compensation plan that provides for cash incentive awards for all of our eligible employees. The plans have been designed to pay for performance by aligning incentive awards for each participant with an evaluation of our achievement of corporate objectives. These corporate objectives are approved by the independent members of our Board based on the recommendations of the Compensation Committee, as well as, in the case of individuals other than our CEO, the achievement of individual business objectives for a particular year. Eligibility to participate in the plans and actual award amounts are not guaranteed and are determined, in the case of our executive officers, at the discretion of the Compensation Committee. After the completion of each year, the Compensation Committee reviews with our CEO the level of achievement of the corporate objectives under the plan and determines the size of the overall bonus pool to be used for awards. The Compensation Committee, with input from our CEO with respect to our other executive officers, may use discretion in determining for each executive officer his or her bonus amount.
| | | Proxy Statement 2022|55 | |
| Executive Compensation | |
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Target incentive award amounts for each participant were based on the participant'sparticipant’s potential impact on our operating and financial results and on market competitive pay practices. Individual performance goals were also established for eligible employees other than our CEO, and evaluations were based upon whether the employee met, exceeded or did not meet each established goal. The Committee believes that it is appropriate to align a higher percentage of our executive officers'officers’ total cash compensation with the achievement of our Board-approved corporate objectives because those objectives are determined with a view toward progressing our Company'sCompany’s business and maximizing stockholder value. Linking a significant percentage of executive officer cash incentive awards to achievement of Committee-approved corporate objectives puts a substantial portion of our CEO'sCEO’s and executive officers'officers’ cash compensation at risk, and is another way the Committee has designed executive compensation to pay for performance.
Annual Incentive Compensation Plan 2021 Corporate Performance Objectives |
Corporate performance objectives for 20202021 were based on achievement of drugthe objectives in the following categories: discovery, objectives, drugclinical development and global commercial, with business development objectives providing additional bonus opportunities.
At the time the corporate performance objectives for 20202021 were set, the Compensation Committee and management believed that achievement of the target levels of performance would be challenging and would require significant effort and skill, positive preclinical study and clinical trial results and continued strong commercial performance.
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Objectives | Target % | Payout % | |||||
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Drug Discovery | 20 | 30 | |||||
✓ Achieved the requisite number of pre-specified goals to outperform, including a successful filing and clearance of an IND for a new molecule, and a subsequent initiation of a first-in-human clinical trial | |||||||
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Drug Development | 50 | 43.75 | |||||
MPNs and GVHD | 10 | 10 | |||||
✓ Once-a-day (QD) ruxolitinib: completed clinical pharmacology studies and developed new formulations by a specified time ✓ Received FDA endorsement of clinical protocol(s) for Phase 3 combination development of ruxolitinib and parsaclisib by a specified time ✓ Developed multiple dose strengths for potential fixed-dose combination therapies by a specified time ✓ Submitted new data for potential inclusion in Jakafi® (ruxolitinib) prescribing information by a specified time | |||||||
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Hematology and Oncology | 27.5 | 21.25 | |||||
✓ Pemigatinib: achieved two pre-specified goals, including approval of NDA by the PDUFA date and submission of J-NDA by a specified time ✓ Parsaclisib: achieved two pre-specified goals, including FDA endorsement of clinical protocols for monotherapy Phase 3 development by a specified time ✓ Retifanlimab: achieved two pre-specified goals, including completion of recruitment of a registration-directed clinical trial ✓ INCB86550: achieved three pre-specified goals, including optimization and scale-up of the manufacturing process and submission of an IND for new small molecule against the same target (PD-L1) ✓ Itacitinib: achieved a recruitment target in a trial in patients with cytokine release syndrome and thereby generate decision-enabling results before the end of the year | |||||||
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Inflammation and AutoImmunity | 12.5 | 12.5 | |||||
✓ Ruxolitinib cream: submitted NDA in atopic dermatitis by a specified time and completed recruitment into the Phase 3 pivotal program in vitiligo by a specified time ✓ Other IAI: initiated a randomized trial of a novel JAK inhibitor in hidradenitis suppurativa by a specified time, and completed recruitment into, and generated decision-enabling results from, a proof-of-concept cohort of parsaclisib in patients with autoimmune hemolytic anemia by a specified time | |||||||
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Development Bonus Opportunities Achieved | 15 | ||||||
✓ Achieved approval of Monjuvi® (tafasitamab-cxix) by the PDUFA date, and submitted the BLA for retifanlimab and the sNDA for ruxolitinib before the end of 2020 | |||||||
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Commercial | 30 | 28.9 | |||||
✓ Payout based on total combined net product revenue for Jakafi® (ruxolitinib) and Iclusig® (ponatinib) | |||||||
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Business Development Bonus Opportunities Achieved | 10 | ||||||
✓ Signed licensing and development deal for tafasitamab with MorphoSys, providing near-term revenue which is also expected to add meaningful revenue growth in 2025 and beyond ✓ Executed an in-licensing deal for clinical stage asset that advances the LIMBER initiative | |||||||
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Total | 100 | 127.65 | |||||
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| Executive Compensation | |
Objectives | | | Target % | | | Payout % | |
Discovery ✓ Achieve the requisite number of pre-specified goals to outperform, including 3 IND filings | | | 20 | | | 26.25 | |
Clinical Development | | | 50 | | | 41.25 | |
Hematology and Oncology ✓ Obtain approval in the U.S. for Jakafi in steroid-refractory chronic GVHD ✓ Advance multiple programs within MPNs/GVHD, including once-a-day (QD) ruxolitinib and the initiation of combination trials by a specific time ✓ Advance multiple clinical research and early development programs within other hematology and oncology ✓ Obtain approval in the U.S. for retifanlimab in squamous cell carcinoma of the anal canal ✓ Regulatory submissions for approval for various assets by a specific time ✓ Enhance manufacturing capabilities to support expanding portfolio | | | 40 | | | 30 | |
Inflammation and AutoImmunity (IAI) ✓ Obtain approval in the U.S. for Opzelura in atopic dermatitis ✓ Submit U.S. sNDA for ruxolitinib cream in vitiligo by a specified time ✓ Submit EU MAA for ruxolitinib cream in vitiligo by a specified time ✓ Advance clinical development programs within inflammation and autoimmunity | | | 10 | | | 11.25 | |
Development Bonus Opportunities ✓ Obtain approval in Europe or Japan for pemigatinib in cholangiocarcinoma or biliary tract carcinoma, respectively ✓ File parsaclisib in NHL for approval in Europe or Japan ✓ Obtain approval in Europe for tafasitamab in r/r DLBCL | | | | | | 15 | |
Global Commercial ✓ Achieve net product sales targets ✓ Successful U.S. launch of Opzelura in atopic dermatitis | | | 30 | | | 29 | |
Business Development Bonus ✓ Bring in complementary and/or supplemental assets with the potential to provide near to mid-term sales revenues and meaningful revenue growth in the 2025+ timeframe or a clinical stage asset that advances the LIMBER initiative | | | | | | 5 | |
Total | | | 100 | | | 101.5 | |
back-up compounds.
| | | Proxy Statement 2022|57 | |
| Executive Compensation | |
Clinical
MPNs and GVHD
Our Leadership In MPNs BEyond Ruxolitinib (LIMBER) program is a key development priority for Incyte and we made important progress here. During 2020, we successfully completed the necessary formulation development and clinical pharmacology trials for our once-a-day (QD) formulation of ruxolitinib, which is now in stability testing ahead of an expected application seeking FDA approval. We also gained FDA endorsement for the design of two pivotal Phase 3 trials to assess the combination of ruxolitinib and parsaclisib, our selective PI3Kdare listed below. inhibitor, in patients with myelofibrosis. We have also successfully initiated development of formulations for potential fixed-dose combinations within the LIMBER program. We did not achieve certain objectives within the INCB57643 (BET) or INCB00928 (ALK2) development programs, largely driven by recruitment and other delays related to COVID-19.
We achieved a bonus opportunity by submitting the sNDA seeking approval of Jakafi in patients with steroid refractory chronic GVHD based on the positive results from the Phase 3 REACH3 trial of ruxolitinib. During 2019 we announced the successful outcome of the pivotal REACH2 trial in patients with steroid-refractory acute GVHD, and these data were submitted to the FDA for inclusion into the prescribing information during 2020. We did not achieve certain target objectives related to the pivotal development of itacitinib in GVHD, as the program was returned to dose-ranging studies after the results of the GRAVITAS-301 became available.
Within
The approval of Monjuvi® (tafasitamab-cxix) was a bonus opportunity that we achieved in 2020, and we were also able to announce the validation of the MAA application seeking approval of tafasitamab in Europe.
We are developing parsaclisib as monotherapy for the treatment of patients with non-Hodgkin lymphomas, and an important goal achieved in 2020 was FDA endorsement of the pivotal trials designs within this program.H1 2022. We also initiated a combination trial of ruxolitinib + INCB00928, our ALK2 inhibitor, by a specific time. Within GVHD, we were able to achieve decision-enabling results for itacitinib from the Japanese development program for parsaclisib.
Developmentdose-finding phase of retifanlimab continues to progress well, andthe 1L chronic GVHD trial by a specific time.
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WeWithin our immuno-oncology (I/O) portfolio, we are also developing a series of oral PD-L1 inhibitors as well as an injectable PD-1 therapy. We are also advancing our adenosine program which includes INCB106385, a dual antagonist of PD-L1. Within this program,A2A/A2B receptors, and INCA00186, an anti-CD73 monoclonal antibody. We initiated a clinical study evaluating our anti-CD73 mAb by a specific time.
Within the development program for itacitinib, our selective JAK1 inhibitor, we were able to meet our recruitment target in the proof-of-concept trial in patients with cytokine release syndrome (CRS) after CAR-T therapy, and thereby generate decision-enabling results before the end of 2020.
parsaclisib.
Our
Most importantly, we submittedwith the NDA seeking approval of ruxolitinib cream as a treatmentOpzelura
Elsewhere within dermatology we were ablealso submitted to accelerate development of INCB54707, our oral selective JAK1 inhibitor and initiatedthe EMA an MAA in vitiligo by a randomized Phase 2b trial earlier than anticipated.
specified time.
Commercial
Jakafi® (ruxolitinib) performance continued to be strong in 2020, reporting revenue for the year at $1,938®/Minjuvi® (tafasitamab-cxix). Total combined oncology net product sales reached $2,396.4 million towards the upper end of[includes Monjuvi U.S. sales as recorded by our guidance range andpartner MorphoSys], representing 15% year-over-year growth. Total net product revenues for Jakafigrowth, which exceeded our threshold of $2,310.5 million and Iclusig® (ponatinib) in 2020 exceeded threshold and was narrowly belowfell short of our target of $2,056$2,519.0 million. We did not meetAdditionally, we successfully launched our first dermatology product, Opzelura, with over 20,000 new-to-brand prescriptions in the levelfourth quarter which surpassed our target of commercial performance needed to achieve a bonus opportunity.
15,000 new-to-brand prescriptions.
The 2020 corporate objectives included two opportunities for bonus achievements under business development activities. These were to execute a licensing deal that would add to near-term revenue or to add meaningfully to revenue in 2025 and beyond, and to execute a collaboration or other transaction that would advance the Bonus
In January 2020, we announced ainitiative by entering into an exclusive worldwide collaboration and license agreement to further develop and commercialize MorphoSys' proprietary anti-CD19axatilimab, an anti-CSF-1R monoclonal antibody, tafasitamab globally. Tafasitamab is an Fc-engineered antibody against CD19 currently in clinical development for the treatment of B cell malignancies. Tafasitamab was subsequently FDA approvedbeing evaluated as Monjuvi®, and Incyte and MorphoSys are co-commercializing in the U.S.; Incyte has exclusive commercialization rights outside of the U.S.
In December 2020, we announced a development collaboration to investigate the combination of ruxolitinib and CK0804, Cellenkos' cryopreserved CXCR4 enriched, allogeneic, umbilical cord blood-derived T-regulatory cells,monotherapy agent in patients with myelofibrosis.
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| Executive Compensation | |
Name | | | Year-End Salary (A) x | | | Target Bonus (B) x | | | Overall Multiplier (C) = | | | Bonus Award (D) | | ||||||||||||
Hervé Hoppenot | | | | $ | 1,143,444 | | | | | | 100% | | | | | | 101.5% | | | | | $ | 1,160,596 | | |
Christiana Stamoulis | | | | $ | 605,640 | | | | | | 50% | | | | | | 101.5% | | | | | $ | 307,363 | | |
Steven H. Stein | | | | $ | 636,695 | | | | | | 50% | | | | | | 101.5% | | | | | $ | 323,123 | | |
Barry P. Flannelly | | | | $ | 530,882 | | | | | | 50% | | | | | | 101.5% | | | | | $ | 269,423 | | |
Maria E. Pasquale | | | | $ | 546,364 | | | | | | 50% | | | | | | 101.5% | | | | | $ | 277,280 | | |
Name | | Year-End Salary (A) x | | Target Bonus % (B) x | | Overall Multiplier (C) = | | Bonus Award (D) | | ||||||||
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Hervé Hoppenot | | $ | 1,099,465 | | | 100 | % | | | 127.65 | % | | $ | 1,403,468 | | ||
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Christiana Stamoulis | | $ | 588,000 | | | 50 | % | | | 127.65 | % | | $ | 375,321 | | ||
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Barry P. Flannelly | | $ | 482,620 | | | 50 | % | | | 127.65 | % | | $ | 308,057 | | ||
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Steven H. Stein | | $ | 578,813 | | | 50 | % | | | 127.65 | % | | $ | 369,457 | | ||
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Vijay Iyengar | | $ | 553,499 | | | 50 | % | | | 127.65 | % | | $ | 353,299 | | ||
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Our incentive compensation program is designed to incentivize employees, including our executive officers, in every area of our Company, which we believe helps lead to significant achievement across all areas. Our Compensation Committee believes that measuring and rewarding achievements from all functions—including functions such as discovery, development, technical operations and business development, whose efforts take a much longer time to make an impact on our top-line revenue or on our stock price—helps ensure that we are properly incentivizing the collective efforts that lead not only to successful current commercial performance but also critically set the stage for potential continued growth and potential long-term sustained success in the years ahead. Our Compensation Committee also believes that linking incentive compensation to corporate goals aligns employees'employees’ incentives with strategic imperatives, thus paying for performance.
2019-2021
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In January 2021,March 2022, the independent members of our Board, based on the recommendations of the Compensation Committee, approved corporate objectives for our 20212022 incentive compensation plan. Under this plan, the funding targets for our CEO was increased to 110% of base salary and the funding targets for our other executive officers remain the same as for 2020.range from 50% to 60% of base salary. Corporate performance objectives for 20212022 are based on achievement of drug discoveryDiscovery, Clinical Development and Global Commercial objectives drug developmentas well as ESG objectives and commercial objectives.
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| Executive Compensation | |
Equity-Based Incentive Awards |
The Compensation Committee administers equity-based incentive awards, such as stock option grants, RSUs and performance shares that are made to our executive officers under our 2010 Stock Incentive Plan. The Compensation Committee believes that by providing those persons who have substantial responsibility for our management and growth with an opportunity to increase their ownership of our stock, the best interests of our stockholders and executive officers will be closely aligned. Therefore, executive officers are eligible to receive equity-based incentive awards when the Compensation Committee performs its annual review, although these awards may be granted at other times in recognition of exceptional achievements. As is the case when the amounts of base salary and initial equity awards are determined, the Compensation Committee conducts a review of all components of an executive officer'sofficer’s compensation when determining annual equity awards to ensure that the executive'sexecutive’s total compensation conforms to our overall philosophy and objectives.
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In 2020,2021, our U.S.-based executive officers received stock options, performance shares and RSUs and our non-U.S.-based executives officers received RSUs for their annual equity awards. The award vehicles will remain the same in 2022. Our CEO received annual equity awards in 2021 our U.S.-based executive officers will receive stock options, performance shares, and RSUs and our non-U.S.-based executive officers will receive RSUs. For our CEO, thewith a total grant date target value of these equity awards was $12,900,000 in 2020$12,400,000 and will be $12,400,000receiving annual equity awards in 2021.2022 with a total target grant value of $13,400,000. For other executive officers, the range of total grant date target valuevalues of thesetheir annual equity awards isin 2021 ranged between $500,000 to $2,200,000. The value of allFor 2022, these will range between $500,000 to $4,200,000. All of these awards are inherently performance-based:
| 60|Proxy Statement 2022 | | | |
| Executive Compensation | |
2021.
Starting with awards to be made in mid-2021, the Compensation Committee has added a total shareholder return (TSR) component to the performance share goals.
In addition, after reviewing CEO compensation within our peer group, our Compensation Committee also lowered Mr. Hoppenot's
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In January 2020, one2021, three of our named executive officers, Christiana Stamoulis, Executive Vice President and Chief Financial Officer, Steven Stein, Executive Vice President and Chief Medical Officer and Barry Flannelly, Executive Vice President, General Manager, North America, received an outstanding merit option grantRSU grants intended to incentivize and retain himthem with a grant date target valuevalues of $1,000,000. This$2,000,000 for Dr. Stein and $1,000,000 each for Ms. Stamoulis and Dr. Flannelly. These outstanding merit option grant isRSU grants are subject to four-year cliff vesting.
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With the failure of our ECHO-301 program in April 2018 and the significant stock price decline which accompanied it, the Compensation Committee believed it was vital to act to preserve the two key engines of
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Proxy Statement | |
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growth within Incyte—namely, the salesforce which generates the revenue to fund our day-to-day operations and the R&D effort which aims to produce the compounds that will potentially lead to future growth.
Accordingly, in June 2018, the Compensation Committee adopted retention plans utilizing performance share awards for certain groups of employees of our Company, namely key R&D employees and our salesforce. The R&D retention plan participants included two of our named executive officers, Drs. Stein and Yao, who each received performance share awards potentially representing 50,000 shares of common stock, which would be earned based on the achievement of a specified number of investigational new drug (IND) filings made by our Company during a specified time frame and, if earned, would vest on the third anniversary of the initial grant date.
In April 2019, following stockholder approval of the increase in the authorized shares available for issuance under our 2010 Stock Incentive Plan, Drs. Stein and Yao received additional performance share awards under the 2018 R&D retention plan, potentially representing 50,000 shares of common stock, which would be earned based on the achievement of a specified number of new chemical entities that are approved by regulatory authorities during a specified time frame. These awards, if earned, would vest on the third anniversary of the initial grant date of the June 2018 awards.
| Executive Compensation | |
”
Other Compensation |
Compensation Committee Report |
Maria E. Pasquale. President and Chief Executive Officer Executive Vice President and Chief Financial Officer Executive Vice President and General Manager—NA Executive Vice President and Chief Medical Officer Executive Vice President, "soliciting material"“soliciting material” or "filed"“filed” with the Securities and Exchange Commission or be deemed incorporated by reference into any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates it by reference into a document filed under such Acts.Company'sCompany’s Annual Report on Form 10-K for the year ended December 31, 2020. Compensation Committee
Jean Jacques Bienaimé (Chair)
Julian C. Baker
Paul J. Clancy 62
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Proxy Statement 20212022|67 Executive CompensationNamed Executive Officers Compensation Chief Financial Officer,CFO, and Steven H. Stein, Barry P. Flannelly Steven H. Stein and Vijay Iyengar.officers'officers’ total compensation for 20202021 as determined under the rules of the Securities and Exchange Commission, or SEC, is set forth in the following table under the caption "Total." “Total.” Name and Principal Position Year
($)
($)
Awards
($)(1)
Awards
($)(1)
Incentive Plan
Compensation
($)(2)
Compensation
($)(3)
($)
President and Chief
Executive Officer 2021 1,139,709 — 7,399,170 4,689,466 1,160,596 55,324 14,444,265 2020 1,094,731 — 8,317,223 5,515,024 1,403,468 47,746 16,378,192 2019 1,044,376 — 6,740,953 5,937,070 1,382,183 46,656 15,151,238
Executive Vice President and
Chief Financial Officer 2021 604,142 — 3,338,400 816,686 307,363 55,970 5,122,561 2020 585,468 — 1,743,359 1,421,498 375,321 28,604 4,154,250 2019 497,096 280,000(4) 824,960 2,474,685 369,600 49,327 4,495,668
Executive Vice President and
Chief Medical Officer 2021 631,779 — 5,364,157 816,686 323,123 28,940 7,164,685 2020 576,321 — 1,418,393 940,557 369,457 22,022 3,326,750 2019 549,812 — 4,868,505 1,235,249 363,825 24,093 7,041,484
Executive Vice President and
General Manager—NA 2021 526,783 — 2,945,522 816,686 269,423 46,644 4,605,058 2020 480,542 — 2,342,694 940,557 308,057 45,034 4,116,884 2019 458,438 — 1,149,505 3,490,293 303,361 41,345 5,442,942
Executive Vice President,
General Counsel and
Corporate Secretary 2021 545,012 — 2,294,968 816,686 277,280 45,305 3,979,251 2020 529,053 — 1,418,393 940,557 338,587 44,381 3,270,971 2019 514,178 — 1,149,505 1,235,249 339,900 20,806 3,259,638
(1)SUMMARY COMPENSATION TABLE Name and Principal Position Year Salary
($) Bonus
($) Stock
Awards
($)(1) Option
Awards
($)(1) Non-Equity
Incentive
Plan
Compensation
($)(2) All Other
Compensation
($)(3) Total
($) Hervé Hoppenot 2020 1,094,731 — 8,317,223 5,515,024 1,403,468 47,746 16,378,192 2019 1,044,376 — 6,740,953 5,937,070 1,382,183 46,656 15,151,238 2018 995,575 — 1,733,822 5,564,508 807,769 212,515 9,314,189
Christiana Stamoulis
2020
585,468
—
1,743,359
1,421,498
375,321
28,604
4,154,250
2019 497,096 280,000 (4) 824,960 2,474,685 369,600 49,327 4,495,668
Barry P. Flannelly
2020
480,542
—
2,342,694
940,557
308,057
45,034
4,116,884
2019 458,438 — 1,149,505 3,490,293 303,361 41,345 5,442,942
Steven H. Stein
2020
576,321
—
1,418,393
940,557
369,457
22,022
3,326,750
2019 549,812 — 4,868,505 1,235,249 363,825 24,093 7,041,484 2018 522,123 — 3,733,824 2,119,070 212,625 23,874 6,611,516
Vijay Iyengar
2020
552,278
—
1,418,393
940,557
353,299
40,323
3,304,850
Global Strategy and
Corporate Development (1)"Stock Awards"“Stock Awards” and "Option Awards"“Option Awards” columns represent the aggregate grant date fair value of stock awards and options awards granted in the respective fiscal years, as determined in accordance with ASC 718. The reported amounts for 2018, 2019, 2020, and 20202021 include the grant date fair value of awards of performance shares, RSUs and option awards.stock options. Additional information with respect to 20202021 performance share, RSU and stock option awards is set forth in the "2020“2021 Grants of Plan Based Awards"Awards” table below.(2) 68|Proxy Statement 2021Executive Compensation(3)Name Year
Insurance
Premiums
($)(a)
Services
($)(b)
Serving as Director
of EU Subsidiary
($)
Reimbursement
($)(b)(c) Hervé Hoppenot 2021 7,524 27,752(12,752) 4,400 — 2020 7,730 21,723(6,723) 2,200 — 2019 5,125 21,643(6,643) 4,400 — Christiana Stamoulis 2021 2,622 15,424(4,774) — 20,524 (6,352) 2020 2,321 4,055(1,255) — 5,128 (1,536) 2019 811 10,883(3,321) — 21,133 (6,239) Steven H. Stein 2021 4,902 2,238(693) 4,400 — 2020 2,315 2,607(807) 2,200 — 2019 1,377 1,816(521) 4,400 — Barry P. Flannelly 2021 7,502 21,742(6,742) — — 2020 6,192 21,742(6,742) — — 2019 3,226 21,619(6,619) — — Maria E. Pasquale 2021 4,902 23,003(8,003) — — 2020 4,267 23,014(8,014) — — 2019 1,278 3,028(1,003) — —
Name | | Year | | Life Insurance Premiums ($)(a) | | Financial Planning Services ($)(b) | | Statutory Fee for Serving as Director of EU Subsidiary ($) | | Travel Reimbursement ($)(b)(c) | | |||||
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Hervé Hoppenot | | 2020 | | 7,730 | | 21,723 (6,723) | | 2,200 | | — | | |||||
| 2019 | | 5,125 | | 21,643 (6,643) | | 4,400 | | — | | ||||||
| 2018 | | 160,207 | | 27,649 (12,649) | | 4,400 | | — | | ||||||
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Christiana Stamoulis | | 2020 | | 2,321 | | 4,055 (1,255) | | — | | 5,128 (1,536) | | |||||
| 2019 | | 811 | | 10,883 (3,321) | | — | | 21,133 (6,239) | | ||||||
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Barry P. Flannelly | | 2020 | | 6,192 | | 21,742 (6,742) | | — | | — | | |||||
| 2019 | | 3,226 | | 21,619 (6,619) | | — | | — | | ||||||
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Steven H. Stein | | 2020 | | 2,315 | | 2,607 (807) | | 2,200 | | — | | |||||
| 2019 | | 1,377 | | 1,816 (521) | | 4,400 | | — | | ||||||
| 2018 | | — | | 1,674 (479) | | 4,400 | | — | | ||||||
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Vijay Iyengar | | 2020 | | 1,500 | | 21,723 (6,723) | | — | | — | | |||||
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| Executive Compensation | |
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| Executive Compensation | |
Name | | | Grant Date | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1)(2) | | | Estimated Future Payouts Equity Incentive Plan Awards Shares(3) | | | All Other Stock Awards: Number of Shares of Stocks or Units (#)(5) | | | All Other Option Awards: Number of Securities Underlying Options (#) | | | Exercise or Base Price of Option Awards ($/Sh) | | | Grant Date Fair Value of Stock and Option Awards ($)(8) | | |||||||||||||||||||||||||||||||||||||||||||||
| Threshold ($) | | | Target ($) | | | Maximum ($) | | | Threshold (#) | | | Target (#) | | | Maximum (#) | | ||||||||||||||||||||||||||||||||||||||||||||||||||
Hervé Hoppenot | | | | | | | | | | | 857,583 | | | | | | 1,143,444 | | | | | | 2,344,060 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 74,720(6) | | | | | | 90.56 | | | | | | 2,228,195 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 84,851(7) | | | | | | 83.58 | | | | | | 2,461,271 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | 33,198 | | | | | | 44,264 | | | | | | 66,396(3) | | | | | | | | | | | | | | | | | | 83.58 | | | | | | 3,699,585 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 44,264 | | | | | | | | | | | | 83.58 | | | | | | 3,699,585 | | | ||
Christiana Stamoulis | | | | | | | | | | | 227,115 | | | | | | 302,820 | | | | | | 620,781 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 11,522 | | | | | | | | | | | | 90.56 | | | | | | 1,043,432 | | | ||
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 12,743(6) | | | | | | 90.56 | | | | | | 380,009 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 15,054(7) | | | | | | 83.58 | | | | | | 436,676 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | 5,890 | | | | | | 7,853 | | | | | | 11,780(3) | | | | | | | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853 | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | 7,561 | | | | | | 15,121 | | | | | | 22,682(4) | | | | | | | | | | | | | | | | | | 64.96 | | | | | | 982,260 | | | ||
Steven H. Stein | | | | | | | | | | | 238,761 | | | | | | 318,348 | | | | | | 652,612 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 23,044 | | | | | | | | | | | | 90.56 | | | | | | 2,086,865 | | | ||
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 12,743(6) | | | | | | 90.56 | | | | | | 380,009 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 15,054(7) | | | | | | 83.58 | | | | | | 436,676 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | 5,890 | | | | | | 7,853 | | | | | | 11,780(3) | | | | | | | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853 | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | 15,122 | | | | | | 30,243 | | | | | | 45,365(4) | | | | | | | | | | | | | | | | | | 64.96 | | | | | | 1,964,585 | | | ||
Barry P. Flannelly | | | | | | | | | | | 199,081 | | | | | | 265,441 | | | | | | 544,154 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 11,522 | | | | | | | | | | | | 90.56 | | | | | | 1,043,432 | | | ||
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 12,743(6) | | | | | | 90.56 | | | | | | 380,009 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 15,054(7) | | | | | | 83.58 | | | | | | 436,676 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | 5,890 | | | | | | 7,853 | | | | | | 11,780(3) | | | | | | | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853 | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | 4,537 | | | | | | 9,073 | | | | | | 13,610(4) | | | | | | | | | | | | | | | | | | 64.96 | | | | | | 589,382 | | | ||
Maria E. Pasquale | | | | | | | | | | | 204,887 | | | | | | 273,182 | | | | | | 560,023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 12,743(6) | | | | | | 90.56 | | | | | | 380,009 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 15,054(7) | | | | | | 83.58 | | | | | | 436,676 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | 5,890 | | | | | | 7,853 | | | | | | 11,780(3) | | | | | | | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853 | | | | | | | | | | | | 83.58 | | | | | | 656,354 | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | 7,561 | | | | | | 15,121 | | | | | | 22,682(4) | | | | | | | | | | | | | | | | | | 64.96 | | | | | | 982,260 | | |
| | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1)(2) | | Estimated Future Payouts Equity Incentive Plan Awards Shares(3) | | All Other Stock Awards: Number of Shares of Stocks or | | All Other Option Awards: Number of Securities Underlying | | Exercise or Base Price of Option | | Grant Date Fair Value of Stock and Option | | |||||||||||||||||||||||||||||||||||
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Name | | Grant Date | | Threshold ($) | | Target ($) | | Maximum ($) | | Threshold (#) | | Target (#) | | Maximum (#) | | Units (#)(4) | | Options (#) | | Awards ($/Sh) | | Awards ($)(5) | | |||||||||||||||||||||||||
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Hervé Hoppenot | | | | 824,599 | | | 1,099,465 | | 2,253,903 | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| 01/17/2020 | | | | | | | | | | | | | | | | | | 96,328 | (6) | | | 80.50 | | | | 2,743,458 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | | | | 74,720 | (7) | | | 106.47 | | | | 2,771,567 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | 29,294 | | | 39,059 | | | 68,353 | | | | | | | | | | 106.47 | | | | 4,158,612 | | | |||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | 39,059 | | | | | | | 106.47 | | | | 4,158,612 | | | |||||||||||||||||||
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Christiana Stamoulis | | | | 220,500 | | | 294,000 | | 602,700 | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| 02/11/2020 | | | | | | | | | | | | | | | | | | 34,240 | (7) | | | 76.14 | | | | 948,820 | | | |||||||||||||||||||
| 02/11/2020 | | | | | | | | | | | | | | | 4,268 | | | | | | | 76.14 | | | | 324,966 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | | | | 12,743 | (7) | | | 106.47 | | | | 472,678 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | 4,996 | | | 6,661 | | | 11,657 | | | | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | 6,661 | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||||
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Barry P. Flannelly | | | | 180,983 | | | 241,310 | | 494,686 | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| 01/17/2020 | | | | | | | | | | | | | | | 11,482 | | | | | | | 80.50 | | | | 924,301 | | | |||||||||||||||||||
| 01/17/2020 | | | | | | | | | | | | | | | | | | 16,428 | (6) | | | 80.50 | | | | 467,878 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | | | | 12,743 | (7) | | | 106.47 | | | | 472,678 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | 4,996 | | | 6,661 | | | 11,657 | | | | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | 6,661 | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||||
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Steven H. Stein | | | | 217,055 | | | 289,407 | | 593,283 | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| 01/17/2020 | | | | | | | | | | | | | | | | | | 16,428 | (6) | | | 80.50 | | | | 467,878 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | | | | 12,743 | (7) | | | 106.47 | | | | 472,678 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | 4,996 | | | 6,661 | | | 11,657 | | | | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | 6,661 | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||||
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Vijay Iyengar | | | | 207,562 | | | 276,750 | | 567,336 | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| 01/17/2020 | | | | | | | | | | | | | | | | | | 16,428 | (6) | | | 80.50 | | | | 467,878 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | | | | 12,743 | (7) | | | 106.47 | | | | 472,678 | | | |||||||||||||||||||
| 07/02/2020 | | | | | | | | 4,996 | | | 6,661 | | | 11,657 | | | | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | | | 6,661 | | | | | | | 106.47 | | | | 709,197 | | | |||||||||||||||||||
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| | | Proxy Statement 2022|65 | |
| Executive Compensation | |
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The Compensation Committee, in consultation with the Company'sCompany’s executive management, reviewed the Company'sCompany’s compensation policies and practices for its employees and concluded that risks arising from those policies and practices are not reasonably likely to have a material adverse effect on the Company.
Termination of Employment and Change-in-Control Arrangements |
We have entered into agreements that may require us to make payments or provide benefits to our named executive officers—Mr. Hoppenot, Ms. Stamoulis, Dr. Stein, Dr. Flannelly, Dr. Stein and Dr. Iyengar—Ms. Pasquale—in connection with specified terminations of employment. The amount and type of compensation payable to each of these named executive officers upon termination of employment under various circumstances and upon a change in control are described below.
Equity Awards |
| 66|Proxy Statement 2022 | | | |
| Executive Compensation | |
Agreement with Our President and CEO |
In connection with his appointment as President and CEO in January 2014, we entered into an employment agreement with Mr. Hoppenot.
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deferred compensation, any accrued vacation pay, and an amount equal to a pro rata portion of his target bonus calculated according to the number of days he worked through the date of termination in the current fiscal year.
| | | Proxy Statement 2022|67 | |
| Executive Compensation | |
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2024) as may be mutually agreed upon would continue to vest as if he continued to be employed by us following the date of his retirement. In addition, any outstanding stock option awards that are granted to Mr. Hoppenot after July 15, 2019 and before December 31, 2024 (or such later date after December 31, 2024 as may be mutually agreed upon) that either were vested at the date of his retirement or become vested due to the post-retirement continued vesting provisions will be exercisable during the remainder of their original term. The effectiveness of these provisions will be subject to Mr. Hoppenot'sHoppenot’s continued compliance with the non-solicitation/non-hiring and non-disparagement covenants described below, including during any period of post-retirement continued vesting provided by the amendments to the agreement.
Agreements with Other Named Executive Officers |
In November 2003, our Board approved a form of employment agreement for Executive Vice Presidents and certain other senior employees. The form of employment agreement for the Executive Vice Presidents and certain other senior employees was amended in December 2008 to comply with Section 409A of the Internal Revenue Code of 1986, as amended. In April 2012, the employment agreements with our Executive Vice Presidents and certain other senior employees were amended to increase the amount payable upon an "involuntary termination"“involuntary termination” of the executive'sexecutive’s employment within 24 months following a change in control. We entered into an employment agreement with Steven H. Stein in March 2015 while he served as one of our senior employees. We entered into employment agreements with Barry P. Flannelly in August 2014, with Vijay IyengarMaria E. Pasquale in May 2016April 2018 and with Christiana Stamoulis in February 2019 upon their employment with us.
| 68|Proxy Statement 2022 | | | |
| Executive Compensation | |
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The following table describes the potential payments and benefits triggered by a termination of employment of a named executive officer for the reasons specified in the table, in each case prior to a change in control and assuming the employment of the named executive officer was terminated on December 31, 2020.
Termination | | | Cash Payment ($) | | | Medical/ Insurance Benefits ($) | | | Acceleration of Equity Awards ($)(1) | | | Other ($)(2) | | | Total ($) | | |||||||||||||||
Hervé Hoppenot Termination without cause or constructive termination Death or Disability | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 4,919,833 | | | | | | 19,422 | | | | | | 3,458,233 | | | | | | 364,447 | | | | | | 8,761,935 | | | ||
| | ��� | — | | | | | | — | | | | | | 2,994,163 | | | | | | 314,447 | | | | | | 3,308,610 | | | ||
Christiana Stamoulis Termination without cause or constructive termination Death or Disability | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 908,460 | | | | | | 12,490 | | | | | | 518,055 | | | | | | 46,588 | | | | | | 1,485,593 | | | ||
| | | — | | | | | | — | | | | | | 518,055 | | | | | | 46,588 | | | | | | 564,643 | | | ||
Steven Stein Termination without cause or constructive termination Death or Disability | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | — | | | | | | — | | | | | | 518,055 | | | | | | 61,221 | | | | | | 579,276 | | | ||
| | | — | | | | | | — | | | | | | 518,055 | | | | | | 61,221 | | | | | | 579,276 | | | ||
Barry Flannelly Termination without cause or constructive termination Death or Disability | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | — | | | | | | — | | | | | | 518,055 | | | | | | 51,046 | | | | | | 569,101 | | | ||
| | | — | | | | | | — | | | | | | 518,055 | | | | | | 51,046 | | | | | | 569,101 | | | ||
Maria E. Pasquale Termination without cause or constructive termination Death or Disability | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | — | | | | | | — | | | | | | 518,055 | | | | | | 15,761 | | | | | | 533,816 | | | ||
| | | — | | | | | | — | | | | | | 518,055 | | | | | | 15,761 | | | | | | 533,816 | | |
Termination | | Cash Payment ($) | | Medical/ Insurance Benefits ($) | | Acceleration of Equity Awards ($)(1) | | Other ($)(2) | | Total ($) | | |||||||||
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Hervé Hoppenot | | | | | | | | | | | ||||||||||
Termination without cause or constructive termination | | 4,769,580 | | | 18,969 | | | | 7,572,967 | | | 339,667 | | 12,701,183 | | |||||
Death or Disability | | — | | | — | | | | 1,134,517 | | | 289,667 | | 1,424,184 | | |||||
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Christiana Stamoulis | | | | | | | | | | | ||||||||||
Termination without cause or constructive termination | | 882,000 | | | 11,948 | | | | 193,477 | | | 56,538 | | 1,143,963 | | |||||
Death or Disability | | — | | | — | | | | 193,477 | | | 56,538 | | 250,015 | | |||||
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Barry Flannelly | | | | | | | | | | | ||||||||||
Termination without cause or constructive termination | | — | | | — | | | | 193,477 | | | 55,687 | | 249,164 | | |||||
Death or Disability | | — | | | — | | | | 193,477 | | | 55,687 | | 249,164 | | |||||
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Steven Stein | | | | | | | | | | | ||||||||||
Termination without cause or constructive termination | | — | | | — | | | | 193,477 | | | 66,786 | | 260,263 | | |||||
Death or Disability | | — | | | — | | | | 193,477 | | | 66,786 | | 260,263 | | |||||
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Vijay Iyengar | | | | | | | | | | | ||||||||||
Termination without cause or constructive termination | | — | | | — | | | | 193,477 | | | 10,644 | | 204,121 | | |||||
Death or Disability | | — | | | — | | | | 193,477 | | | 10,644 | | 204,121 | | |||||
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| Executive Compensation | |
Termination | | | Cash Payment ($) | | | Medical/ Insurance Benefits ($) | | | Acceleration of Equity Awards ($)(1) | | | Other ($)(2) | | | Total ($) | | |||||||||||||||
Hervé Hoppenot Termination without cause or for good reason(3) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 8,740,201 | | | | | | 68,570 | | | | | | 14,912,523 | | | | | | 364,447 | | | | | | 24,085,741 | | | ||
Christiana Stamoulis Termination without cause or for good reason(3) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,264,742 | | | | | | 12,490 | | | | | | 4,576,490 | | | | | | 46,588 | | | | | | 6,900,310 | | | ||
Steven H. Stein Termination without cause or for good reason(3) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,330,652 | | | | | | 36,869 | | | | | | 10,209,015 | | | | | | 61,221 | | | | | | 12,637,757 | | | ||
Barry P. Flannelly Termination without cause or for good reason(3) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 1,943,319 | | | | | | 35,980 | | | | | | 5,053,510 | | | | | | 51,046 | | | | | | 7,083,855 | | | ||
Maria E. Pasquale Termination without cause or for good reason(3) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,043,084 | | | | | | 35,985 | | | | | | 3,874,011 | | | | | | 15,761 | | | | | | 5,968,841 | | |
Termination | | Cash Payment($) | | Medical/ Insurance Benefits($) | | Acceleration of Equity Awards($)(1) | | Other($)(2) | | Total($) | | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | | | | | |||||||||
Hervé Hoppenot | | | | | | | | | | | ||||||||||
Termination without cause or for good reason(3) | | 8,492,052 | | | 66,359 | | | 14,908,424 | | | 339,667 | | | 23,806,502 | | |||||
| | | | | | | | | | | | |||||||||
Christiana Stamoulis | | | | | | | | | | | ||||||||||
Termination without cause or for good reason(3) | | 2,209,200 | | | 11,948 | | | 2,839,106 | | | 56,538 | | | 5,116,792 | | |||||
| | | | | | | | | | | | |||||||||
Barry P. Flannelly | | | | | | | | | | | ||||||||||
Termination without cause or for good reason(3) | | 1,813,272 | | | 34,845 | | | 4,674,407 | | | 55,687 | | | 6,578,211 | | |||||
| | | | | | | | | | | | |||||||||
Steven H. Stein | | | | | | | | | | | ||||||||||
Termination without cause or for good reason(3) | | 2,174,683 | | | 35,821 | | | 11,445,428 | | | 66,786 | | | 13,722,718 | | |||||
| | | | | | | | | | | | |||||||||
Vijay Iyengar | | | | | | | | | | | ||||||||||
Termination without cause or for good reason(3) | | 2,096,546 | | | 35,315 | | | 3,211,558 | | | 10,644 | | | 5,354,063 | | |||||
| | | | | | | | | | | |
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| |
Proxy Statement | | | |
| Executive Compensation | |
20202021 Outstanding Equity Awards at Fiscal Year-End
| | | | | | | | | Option Awards | | | Stock Awards | | ||||||||||||||||||||||||||||||||||||||||||
Name | | | Grant Date | | | Number of Securities Underlying Unexercised Options (#) Exercisable (1) | | | Number of Securities Underlying Unexercised Options (#) Un-Exercisable | | | Option Exercise Price ($) | | | Option Expiration Date | | | Number of Shares or Units of Stock That Have Not Vested (#) | | | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | |||||||||||||||||||||||||||
Hervé Hoppenot | | | | | **01/07/2016 | | | | | | 20,195 | | | | | | — | | | | | | 95.76 | | | | | | 01/06/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 01/07/2016 | | | | | | 75,138 | | | | | | — | | | | | | 95.76 | | | | | | 01/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/15/2016 | | | | | | 74,245 | | | | | | — | | | | | | 83.83 | | | | | | 07/14/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/17/2017 | | | | | | 74,245 | | | | | | — | | | | | | 113.64 | | | | | | 01/16/2027 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | **01/17/2017 | | | | | | 94,325 | | | | | | — | | | | | | 113.64 | | | | | | 01/16/2027 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/05/2017 | | | | | | 47,168 | | | | | | — | | | | | | 128.34 | | | | | | 07/04/2027 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/23/2018 | | | | | | 47,168 | | | | | | — | | | | | | 94.63 | | | | | | 01/22/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | **01/24/2018 | | | | | | — | | | | | | 25,401 | | | | | | 95.34 | | | | | | 01/23/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/02/2018 | | | | | | 75,642 | | | | | | 12,915 | | | | | | 68.62 | | | | | | 07/01/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 5,242(4) | | | | | | 384,763 | | | | | | | | | | | | | | | ||
| | | ***01/04/2019 | | | | | | 75,643 | | | | | | 12,915 | | | | | | 72.27 | | | | | | 01/03/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 19,824(3) | | | | | | 1,455,082 | | | | | | | | | | | | | | | ||
| | | *07/02/2019 | | | | | | 58,197 | | | | | | 38,130 | | | | | | 85.01 | | | | | | 07/01/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 20,180(4) | | | | | | 1,481,212 | | | | | | | | | | | | | | | ||
| | | ***01/17/2020 | | | | | | 58,198 | | | | | | 38,130 | | | | | | 80.50 | | | | | | 01/16/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 29,295(3) | | | | | | 2,150,253 | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 9,452(5) | | | | | | 693,777 | | | | | | 29,607(6) | | | | | | 2,173,154(8) | | | ||
| | | *07/02/2020 | | | | | | 26,463 | | | | | | 48,257 | | | | | | 106.47 | | | | | | 07/01/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/15/2021 | | | | | | 26,463 | | | | | | 48,257 | | | | | | 90.56 | | | | | | 01/14/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 13,279(5) | | | | | | 974,679 | | | | | | 30,985(7) | | | | | | 2,274,299(8) | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 44,264(3) | | | | | | 3,248,978 | | | | | | | | | | | | | | | ||
| | | *07/02/2021 | | | | | | — | | | | | | 84,851 | | | | | | 83.58 | | | | | | 07/01/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | | | | | | | 753,090 | | | | | | 308,856 | | | | | | | | | | | | | | | | | | 141,536 | | | | | | 10,388,744 | | | | | | 60,592 | | | | | | 4,447,453 | | | ||
| | | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Christiana Stamoulis | | | | | 02/11/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 5,143(3) | | | | | | 377,496 | | | | | | | | | | | | | | |
| | | *02/11/2019 | | | | | | 51,572 | | | | | | 21,237 | | | | | | 80.21 | | | | | | 02/11/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 02/11/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,201(3) | | | | | | 234,953 | | | | | | | | | | | | | | | ||
| | | *02/11/2020 | | | | | | 15,693 | | | | | | 18,547 | | | | | | 76.14 | | | | | | 02/11/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 4,996(3) | | | | | | 366,706 | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,611(5) | | | | | | 118,247 | | | | | | 5,050(6) | | | | | | 370,670(8) | | | ||
| | | *07/02/2020 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 106.47 | | | | | | 07/01/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/15/2021 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 90.56 | | | | | | 01/14/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 11,522(10) | | | | | | 845,715 | | | | | | | | | | | | | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2,355(5) | | | | | | 172,857 | | | | | | 5,498(7) | | | | | | 403,553(8) | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853(3) | | | | | | 576,410 | | | | | | | | | | | | | | | ||
| | | *07/02/2021 | | | | | | — | | | | | | 15,054 | | | | | | 83.58 | | | | | | 07/01/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 15,121(11) | | | | | | 1,109,881 | | | ||
| | | | | | | | | 76,289 | | | | | | 71,300 | | | | | | | | | | | | | | | | | | 36,681 | | | | | | 2,692,384 | | | | | | 25,669 | | | | | | 1,884,104 | | | ||
|
| | Option Awards | | Stock Awards | | |||||||||||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||
Name | | Grant Date | | Number of Securities Underlying Unexercised Options (#) Exercisable (1) | | Number of Securities Underlying Unexercised Options (#) Un-Exercisable | | Option Exercise Price ($) | | Option Expiration Date | | Number of Shares or Units of Stock That Have Not Vested (#) | | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | |||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||
Hervé Hoppenot | | **01/07/2016 | | | 20,195 | | | | — | | | | $ | 95.76 | | | 01/06/2026 | | | | | | | | | | | | ||||||||||||
| 01/07/2016 | | | 75,138 | | | | — | | | | $ | 95.76 | | | 01/06/2023 | | | | | | | | | | | | |||||||||||||
| *07/15/2016 | | | 74,245 | | | | — | | | | $ | 83.83 | | | 07/14/2026 | | | | | | | | | | | | |||||||||||||
| 07/05/2017 | | | | | | | | | | | | | 3,420 | (3) | | 297,472 | | | | | | | | ||||||||||||||||
| ***01/17/2017 | | | 74,245 | | | | — | | | | $ | 113.64 | | | 01/16/2027 | | | | | | | | | | | | |||||||||||||
| **01/17/2017 | | | — | | | | 94,325 | | | | $ | 113.64 | | | 01/16/2027 | | | | | | | | | | | | |||||||||||||
| *07/05/2017 | | | 40,289 | | | | 6,879 | | | | $ | 128.34 | | | 07/04/2027 | | | | | | | | | | | | |||||||||||||
| ***01/23/2018 | | | 40,289 | | | | 6,879 | | | | $ | 94.63 | | | 01/22/2028 | | | | | | | | | | | | |||||||||||||
| **01/24/2018 | | | — | | | | 25,401 | | | | $ | 95.34 | | | 01/23/2028 | | | | | | | | | | | | |||||||||||||
| *07/02/2018 | | | 53,503 | | | | 35,054 | | | | $ | 68.62 | | | 07/01/2028 | | | | | | | | | | | | |||||||||||||
| 07/02/2018 | | | | | | | | | | | | | 10,485 | (4) | | 911,985 | | | | | | | | ||||||||||||||||
| ***01/04/2019 | | | 53,503 | | | | 35,055 | | | | $ | 72.27 | | | 01/03/2029 | | | | | | | | | | | | |||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 29,736 | (3) | | 2,586,437 | | | | | | | | ||||||||||||||||
| *07/02/2019 | | | 34,115 | | | | 62,212 | | | | $ | 85.01 | | | 07/01/2029 | | | | | | | | | | | | |||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 30,270 | (4) | | 2,632,885 | | | | | | | | ||||||||||||||||
| ***01/17/2020 | | | 34,116 | | | | 62,212 | | | | $ | 80.50 | | | 01/16/2030 | | | | | | | | | | | | |||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 7,225 | (5) | | 628,431 | | | 31,834 | (6) | | | 2,768,921 | (7) | | ||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 39,059 | (3) | | 3,397,352 | | | | | | | | ||||||||||||||||
| *07/02/2020 | | | — | | | | 74,720 | | | | $ | 106.47 | | | 07/01/2030 | | | | | | | | | | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
| | | 499,638 | | | | 402,737 | | | | | | | | 120,195 | | | 10,454,562 | | | 31,834 | | | | 2,768,921 | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
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Christiana Stamoulis | | 02/11/2019 | | | | | | | | | | | | | 7,714 | (3) | | 670,964 | | | | | | | | |||||||||||||||
| *02/11/2019 | | | 33,370 | | | | 39,439 | | | | $ | 80.21 | | | 02/11/2029 | | | | | | | | | | | | |||||||||||||
| 02/11/2020 | | | | | | | | | | | | | 4,268 | (3) | | 371,231 | | | | | | | | ||||||||||||||||
| *02/11/2020 | | | — | | | | 34,240 | | | | $ | 76.14 | | | 02/11/2030 | | | | | | | | | | | | |||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 1,232 | (5) | | 107,159 | | | 5,429 | (6) | | | 472,214 | (7) | | ||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 6,661 | (3) | | 579,374 | | | | | | | | ||||||||||||||||
| *07/02/2020 | | | — | | | | 12,743 | | | | $ | 106.47 | | | 07/01/2030 | | | | | | | | | | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
| | | 33,370 | | | | 86,422 | | | | | | | | 19,875 | | | 1,728,728 | | | 5,429 | | | | 472,214 | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||
Barry P. Flannelly | | **01/07/2016 | | | 4,039 | | | | — | | | | $ | 95.76 | | | 01/06/2026 | | | | | | | | | | | | ||||||||||||
| 01/07/2016 | | | 18,784 | | | | — | | | | $ | 95.76 | | | 01/06/2023 | | | | | | | | | | | | |||||||||||||
| *07/15/2016 | | | 19,091 | | | | — | | | | $ | 83.83 | | | 07/14/2026 | | | | | | | | | | | | |||||||||||||
| 07/05/2017 | | | | | | | | | | | | | 880 | (3) | | 76,542 | | | | | | | | ||||||||||||||||
| ***01/17/2017 | | | 19,091 | | | | — | | | | $ | 113.64 | | | 01/16/2027 | | | | | | | | | | | | |||||||||||||
| *07/05/2017 | | | 10,359 | | | | 1,769 | | | | $ | 128.34 | | | 07/04/2027 | | | | | | | | | | | | |||||||||||||
| ***01/23/2018 | | | 10,359 | | | | 1,769 | | | | $ | 94.63 | | | 01/22/2028 | | | | | | | | | | | | |||||||||||||
| *07/02/2018 | | | 13,758 | | | | 9,014 | | | | $ | 68.62 | | | 07/01/2028 | | | | | | | | | | | | |||||||||||||
| 07/02/2018 | | | | | | | | | | | | | 2,695 | (4) | | 234,411 | | | | | | | | ||||||||||||||||
| ***01/04/2019 | | | 13,758 | | | | 9,014 | | | | $ | 72.27 | | | 01/03/2029 | | | | | | | | | | | | |||||||||||||
| **01/04/2019 | | | — | | | | 63,105 | | | | $ | 72.27 | | | 01/03/2029 | | | | | | | | | | | | |||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 5,071 | (3) | | 441,076 | | | | | | | | ||||||||||||||||
| *07/02/2019 | | | 5,818 | | | | 10,610 | | | | $ | 85.01 | | | 07/01/2029 | | | | | | | | | | | | |||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 5,161 | (4) | | 448,904 | | | | | | | | ||||||||||||||||
| 01/17/2020 | | | | | | | | | | | | | 11,482 | (8) | | 998,704 | | | | | | | | ||||||||||||||||
| ***01/17/2020 | | | 5,818 | | | | 10,610 | | | | $ | 80.50 | | | 01/16/2030 | | | | | | | | | | | | |||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 1,232 | (5) | | 107,159 | | | 5,429 | (6) | | | 472,214 | (7) | | ||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 6,661 | (3) | | 579,374 | | | | | | | | ||||||||||||||||
| *07/02/2020 | | | — | | | | 12,743 | | | | $ | 106.47 | | | 07/01/2030 | | | | | | | | | | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
| | | 120,875 | | | | 118,634 | | | | | | | | 33,182 | | | 2,886,170 | | | 5,429 | | | | 472,214 | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
| | | | | | | | | | | | | | | | | | | |
| | | Proxy Statement 2022|71 | |
|
|
| |
| | | | | | | | | Option Awards | | | Stock Awards | | ||||||||||||||||||||||||||||||||||||||||||
Name | | | Grant Date | | | Number of Securities Underlying Unexercised Options (#) Exercisable (1) | | | Number of Securities Underlying Unexercised Options (#) Un-Exercisable | | | Option Exercise Price ($) | | | Option Expiration Date | | | Number of Shares or Units of Stock That Have Not Vested (#) | | | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | |||||||||||||||||||||||||||
Steven Stein | | | | | 01/07/2016 | | | | | | 8,870 | | | | | | — | | | | | | 95.76 | | | | | | 01/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | **01/07/2016 | | | | | | 4,039 | | | | | | — | | | | | | 95.76 | | | | | | 01/06/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/15/2016 | | | | | | 1,194 | | | | | | — | | | | | | 83.83 | | | | | | 07/14/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/17/2017 | | | | | | 19,091 | | | | | | — | | | | | | 113.64 | | | | | | 01/16/2027 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | **01/17/2017 | | | | | | 18,865 | | | | | | — | | | | | | 113.64 | | | | | | 01/16/2027 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/05/2017 | | | | | | 12,128 | | | | | | — | | | | | | 128.34 | | | | | | 07/04/2017 | | | | | | | | | | | | | | | | | | | | | | | | ��� | | | ||
| | | ***01/23/2018 | | | | | | 12,128 | | | | | | — | | | | | | 94.63 | | | | | | 01/22/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | **01/24/2018 | | | | | | | | | | | | 21,167 | | | | | | 95.34 | | | | | | 01/23/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/02/2018 | | | | | | 5,219 | | | | | | 3,321 | | | | | | 68.62 | | | | | | 07/01/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,348(4) | | | | | | 98,943 | | | | | | | | | | | | | | | ||
| | | ***01/04/2019 | | | | | | 3,321 | | | | | | 9,014 | | | | | | 72.27 | | | | | | 01/03/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 04/29/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 25,000(9) | | | | | | 1,835,000 | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,381(3) | | | | | | 248,165 | | | | | | | | | | | | | | | ||
| | | *07/02/2019 | | | | | | 9,925 | | | | | | 6,503 | | | | | | 85.01 | | | | | | 07/01/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,441(4) | | | | | | 252,569 | | | | | | | | | | | | | | | ||
| | | ***01/17/2020 | | | | | | 9,925 | | | | | | 6,503 | | | | | | 80.50 | | | | | | 01/16/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 4,996(3) | | | | | | 366,706 | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,611(5) | | | | | | 118,247 | | | | | | 5,050(6) | | | | | | 370,670(8) | | | ||
| | | *07/02/2020 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 106.47 | | | | | | 07/01/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/15/2021 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 90.56 | | | | | | 01/14/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 23,044(10) | | | | | | 1,691,430 | | | | | | | | | | | | | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2,355(5) | | | | | | 172,857 | | | | | | 5,498(7) | | | | | | 403,553(8) | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853(3) | | | | | | 576,410 | | | | | | | | | | | | | | | ||
| | | *07/02/2021 | | | | | | — | | | | | | 15,054 | | | | | | 83.58 | | | | | | 07/01/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 30,243(11) | | | | | | 2,219,836 | | | ||
| | | | | | | | | 113,729 | | | | | | 78,024 | | | | | | | | | | | | | | | | | | 73,029 | | | | | | 5,360,327 | | | | | | 40,791 | | | | | | 2,994,059 | | | ||
|
| | | |
| Executive Compensation | |
| | | | | | | | | Option Awards | | | Stock Awards | | ||||||||||||||||||||||||||||||||||||||||||
Name | | | Grant Date | | | Number of Securities Underlying Unexercised Options (#) Exercisable (1) | | | Number of Securities Underlying Unexercised Options (#) Un-Exercisable | | | Option Exercise Price ($) | | | Option Expiration Date | | | Number of Shares or Units of Stock That Have Not Vested (#) | | | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | |||||||||||||||||||||||||||
Barry P. Flannelly | | | | | **01/07/2016 | | | | | | 4,039 | | | | | | — | | | | | | 95.76 | | | | | | 01/06/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 01/07/2016 | | | | | | 18,784 | | | | | | — | | | | | | 95.76 | | | | | | 01/06/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/15/2016 | | | | | | 19,091 | | | | | | — | | | | | | 83.83 | | | | | | 07/14/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/17/2017 | | | | | | 19,091 | | | | | | — | | | | | | 113.64 | | | | | | 01/16/2027 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/05/2017 | | | | | | 12,128 | | | | | | — | | | | | | 128.34 | | | | | | 07/04/2027 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/23/2018 | | | | | | 12,128 | | | | | | — | | | | | | 94.63 | | | | | | 01/22/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | *07/02/2018 | | | | | | 19,451 | | | | | | 3,321 | | | | | | 68.62 | | | | | | 07/01/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,348(4) | | | | | | 98,943 | | | | | | | | | | | | | | | ||
| | | ***01/04/2019 | | | | | | 19,451 | | | | | | 3,321 | | | | | | 72.27 | | | | | | 01/03/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | **01/04/2019 | | | | | | | | | | | | 63,105 | | | | | | 72.27 | | | | | | 01/03/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,381(3) | | | | | | 248,165 | | | | | | | | | | | | | | | ||
| | | *07/02/2019 | | | | | | 9,925 | | | | | | 6,503 | | | | | | 85.01 | | | | | | 07/01/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,441(4) | | | | | | 252,569 | | | | | | | | | | | | | | | ||
| | | 01/17/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 11,482(10) | | | | | | 842,779 | | | | | | | | | | | | | | | ||
| | | ***01/17/2020 | | | | | | 9,925 | | | | | | 6,503 | | | | | | 80.50 | | | | | | 01/16/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 4,996(3) | | | | | | 366,706 | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,611(5) | | | | | | 118,247 | | | | | | 5,050(6) | | | | | | 370,670(8) | | | ||
| | | *07/02/2020 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 106.47 | | | | | | 07/01/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/15/2021 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 90.56 | | | | | | 01/14/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 01/15/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 11,522(10) | | | | | | 845,715 | | | | | | | | | | | | | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2,355(5) | | | | | | 172,857 | | | | | | 5,498(7) | | | | | | 403,553(8) | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853(3) | | | | | | 576,410 | | | | | | | | | | | | | | | ||
| | | *07/02/2021 | | | | | | — | | | | | | 15,054 | | | | | | 83.58 | | | | | | 07/01/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 9,073(11) | | | | | | 665,958 | | | ||
| | | | | | | | | 153,037 | | | | | | 114,269 | | | | | | | | | | | | | | | | | | 47,989 | | | | | | 3,522,391 | | | | | | 19,621 | | | | | | 1,440,181 | | | ||
| | | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Maria E. Pasquale | | | | | *04/09/2018 | | | | | | 11,344 | | | | | | 3,433 | | | | | | 65.36 | | | | | | 04/08/2028 | | | | | | | | | | | | | | | | | | | | | | |||||
| | | 04/09/2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,482(3) | | | | | | 108,779 | | | | | | | | | | | | | | | ||
| | | *07/02/2018 | | | | | | 7,117 | | | | | | 3,321 | | | | | | 68.62 | | | | | | 07/01/2028 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2018 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,348(4) | | | | | | 98,943 | | | | | | | | | | | | | | | ||
| | | ***01/04/2019 | | | | | | 8,540 | | | | | | 3,321 | | | | | | 72.27 | | | | | | 01/03/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,381(3) | | | | | | 248,165 | | | | | | | | | | | | | | | ||
| | | *07/02/2019 | | | | | | 9,925 | | | | | | 6,503 | | | | | | 85.01 | | | | | | 07/01/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2019 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,441(4) | | | | | | 252,569 | | | | | | | | | | | | | | | ||
| | | ***01/17/2020 | | | | | | 9,925 | | | | | | 6,503 | | | | | | 80.50 | | | | | | 01/16/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,611(5) | | | | | | 118,247 | | | | | | 5,050(6) | | | | | | 370,670(8) | | | ||
| | | 07/02/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 4,996(3) | | | | | | 366,706 | | | | | | | | | | | | | | | ||
| | | *07/02/2020 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 106.47 | | | | | | 07/01/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | ***01/15/2021 | | | | | | 4,512 | | | | | | 8,231 | | | | | | 90.56 | | | | | | 01/14/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2,355(5) | | | | | | 172,857 | | | | | | 5,498(7) | | | | | | 403,553(8) | | | ||
| | | 07/02/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 7,853(3) | | | | | | 576,410 | | | | | | | | | | | | | | | ||
| | | *07/02/2021 | | | | | | — | | | | | | 15,054 | | | | | | 83.58 | | | | | | 07/01/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 12/01/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 15,121(11) | | | | | | 1,109,881 | | | ||
| | | | | | | | | 55,875 | | | | | | 54,597 | | | | | | | | | | | | | | | | | | 26,467 | | | | | | 1,942,676 | | | | | | 25,669 | | | | | | 1,884,104 | | | ||
|
| | Option Awards | | Stock Awards | | |||||||||||||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||
Name | | Grant Date | | Number of Securities Underlying Unexercised Options (#) Exercisable (1) | | Number of Securities Underlying Unexercised Options (#) Un-Exercisable | | Option Exercise Price ($) | | Option Expiration Date | | Number of Shares or Units of Stock That Have Not Vested (#) | | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | |||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||
Steven H. Stein | | 01/07/2016 | | | 8,870 | | | | — | | | | $ | 95.76 | | | 01/06/2023 | | | | | | | | | | | | | | ||||||||||||
| **01/07/2016 | | | 4,039 | | | | — | | | | $ | 95.76 | | | 01/06/2026 | | | | | | | | | | | | | | |||||||||||||
| *07/15/2016 | | | 1,194 | | | | — | | | | $ | 83.83 | | | 07/14/2026 | | | | | | | | | | | | | | |||||||||||||
| 07/05/2017 | | | | | | | | | | | | | 880 | (3) | | | 76,542 | | | | | | | | | ||||||||||||||||
| ***01/17/2017 | | | 19,091 | | | | — | | | | $ | 113.64 | | | 01/16/2027 | | | | | | | | | | | | | | |||||||||||||
| **01/17/2017 | | | — | | | | 18,865 | | | | $ | 113.64 | | | 01/16/2027 | | | | | | | | | | | | | | |||||||||||||
| *07/05/2017 | | | 10,359 | | | | 1,769 | | | | $ | 128.34 | | | 07/04/2027 | | | | | | | | | | | | | | |||||||||||||
| ***01/23/2018 | | | 10,359 | | | | 1,769 | | | | $ | 94.63 | | | 01/22/2028 | | | | | | | | | | | | | | |||||||||||||
| **01/24/2018 | | | — | | | | 21,167 | | | | $ | 95.34 | | | 01/23/2028 | | | | | | | | | | | | | | |||||||||||||
| 06/28/2018 | | | | | | | | | | | | | 50,000 | (9) | | | 4,349,000 | | | | | | | | | ||||||||||||||||
| *07/02/2018 | | | 3,321 | | | | 9,014 | | | | $ | 68.62 | | | 07/01/2028 | | | | | | | | | | | | | | |||||||||||||
| 07/02/2018 | | | | | | | | | | | | | 2,695 | (4) | | | 234,411 | | | | | | | | | ||||||||||||||||
| ***01/04/2019 | | | 3,321 | | | | 9,014 | | | | $ | 72.27 | | | 01/03/2029 | | | | | | | | | | | | | | |||||||||||||
| 04/29/2019 | | | | | | | | | | | | | 25,000 | (10) | | | 2,174,500 | | | | 25,000 | (11) | | | 2,174,500 | (7) | | ||||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 5,071 | (3) | | | 441,076 | | | | | | | | | ||||||||||||||||
| *07/02/2019 | | | 5,818 | | | | 10,610 | | | | $ | 85.01 | | | 07/01/2029 | | | | | | | | | | | | | | |||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 5,161 | (4) | | | 448,904 | | | | | | | | | ||||||||||||||||
| ***01/17/2020 | | | 5,818 | | | | 10,610 | | | | $ | 80.50 | | | 01/16/2030 | | | | | | | | | | | | | | |||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 1,232 | (5) | | | 107,159 | | | | 5,429 | (6) | | | 472,214 | (7) | | ||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 6,661 | (3) | | | 579,374 | | | | | | | | | ||||||||||||||||
| *07/02/2020 | | | — | | | | 12,743 | | | | $ | 106.47 | | | 07/01/2030 | | | | | | | | | | | | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
| | | 72,190 | | | | 95,561 | | | | | | | | 96,700 | | | | 8,410,966 | | | | 30,429 | | | | 2,646,714 | | | |||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||
Vijay Iyengar | | 05/09/2016 | | | 11,982 | | | | — | | | | $ | 72.86 | | | 05/08/2023 | | | | | | | | | | | | | | ||||||||||||
| 07/05/2017 | | | | | | | | | | | | | 880 | (3) | | | 76,542 | | | | | | | | | ||||||||||||||||
| ***01/17/2017 | | | — | | | | 18,865 | | | | $ | 113.64 | | | 01/16/2027 | | | | | | | | | | | | | | |||||||||||||
| *07/05/2017 | | | 10,359 | | | | 1,769 | | | | $ | 128.34 | | | 07/04/2027 | | | | | | | | | | | | | | |||||||||||||
| ***01/23/2018 | | | 10,359 | | | | 1,769 | | | | $ | 94.63 | | | 01/22/2028 | | | | | | | | | | | | | | |||||||||||||
| *07/02/2018 | | | 13,758 | | | | 9,014 | | | | $ | 68.62 | | | 07/01/2028 | | | | | | | | | | | | | | |||||||||||||
| 07/02/2018 | | | | | | | | | | | | | 2,695 | (4) | | | 234,411 | | | | | | | | | ||||||||||||||||
| ***01/04/2019 | | | 13,758 | | | | 9,014 | | | | $ | 72.27 | | | 01/03/2029 | | | | | | | | | | | | | | |||||||||||||
| **01/04/2019 | | | — | | | | 31,552 | | | | $ | 72.27 | | | 01/03/2029 | | | | | | | | | | | | | | |||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 5,071 | (3) | | | 441,076 | | | | | | | | | ||||||||||||||||
| *07/02/2019 | | | 5,818 | | | | 10,610 | | | | $ | 85.01 | | | 07/01/2029 | | | | | | | | | | | | | | |||||||||||||
| 07/02/2019 | | | | | | | | | | | | | 5,161 | (4) | | | 448,904 | | | | | | | | | ||||||||||||||||
| ***01/17/2020 | | | 5,818 | | | | 10,610 | | | | $ | 80.50 | | | 01/16/2030 | | | | | | | | | | | | | | |||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 1,232 | (5) | | | 107,159 | | | | 5,429 | (6) | | | 472,214 | (7) | | ||||||||||||||
| 07/02/2020 | | | | | | | | | | | | | 6,661 | (3) | | | 579,374 | | | | | | | | | ||||||||||||||||
| *07/02/2020 | | | — | | | | 12,743 | | | | $ | 106.47 | | | 07/01/2030 | | | | | | | | | | | | | | |||||||||||||
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| | | 71,852 | | | | 105,946 | | | | | | | | 21,700 | | | | 1,887,466 | | | | 5,429 | | | | 472,214 | | | |||||||||||||
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| | | Proxy Statement 2022|73 | |
| Executive Compensation | |
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| Executive Compensation | |
| | | Option Awards | | | Stock Awards | | ||||||||||||||||||
Name | | | Number of Shares Acquired on Exercise (#) | | | Value Realized on Exercise ($)(1) | | | Number of Shares Acquired on Vesting (#) | | | Value Realized on Vesting ($)(2) | | ||||||||||||
Hervé Hoppenot | | | | | — | | | | | | — | | | | | | 38,429(3) | | | | | | 3,211,075 | | |
Christiana Stamoulis | | | | | — | | | | | | — | | | | | | 5,303(4) | | | | | | 448,354 | | |
Steven H. Stein | | | | | 3,795 | | | | | | 119,087 | | | | | | 57,302(5) | | | | | | 4,890,590 | | |
Barry P. Flannelly | | | | | — | | | | | | — | | | | | | 7,302(6) | | | | | | 610,090 | | |
Maria E. Pasquale | | | | | 1,146 | | | | | | 16,129 | | | | | | 7,904(7) | | | | | | 655,251 | | |
| | Option Awards | | | | Stock Awards | | | |||||||||||||
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Name | | Number of Shares Acquired on Exercise (#) | | Value Realized on Exercise ($)(1) | | Number of Shares Acquired on Vesting (#) | | Value Realized on Vesting ($)(2) | | ||||||||||||
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Hervé Hoppenot | | | 213,919 | | | | 8,065,323 | | | | 100,732 | (3) | | | 9,350,807 | | | ||||
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Christiana Stamoulis | | | — | | | | — | | | | 2,571 | (4) | | | 195,756 | | | ||||
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Barry P. Flannelly | | | 34,363 | | | | 1,189,187 | | | | 7,025 | (5) | | | 746,028 | | | ||||
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Steven H. Stein | | | 44,478 | | | | 1,300,657 | | | | 7,025 | (6) | | | 746,028 | | | ||||
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Vijay Iyengar | | | 7,866 | | | | 252,813 | | | | 5,636 | (7) | | | 601,225 | | | ||||
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Based on this information, for 2021 the ratio of the annual total compensation of Mr. Hoppenot, our CEO, to the median of the annual total compensation of all employees was 58 to 1. |
To identify the median of the annual total compensation of all our employees, as well as to determine the annual total compensation of the "median“median employee,"” the methodology and the material assumptions, adjustments, and estimates that we used were as follows:
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| | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | | | Weighted-average exercise price of outstanding options, warrants and rights ($) | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | | |||||||||
Plan Category | | | (a) | | | (b) | | | (c) | | |||||||||
Equity compensation plans approved by security holders | | | | | 16,863,292(1) | | | | | | 88.39(2) | | | | | | 10,654,571(3) | | |
Equity compensation plans not approved by security holders | | | | | — | | | | | | — | | | | | | — | | |
Total | | | | | 16,863,292 | | | | | | 88.39 | | | | | | 10,654,571 | | |
| Number of securities to be issued upon exercise of outstanding options, warrants and rights | | Weighted-average exercise price of outstanding options, warrants and rights ($) | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | | ||||||||||
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Plan Category | | (a) | | (b) | | (c) | | |||||||||
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Equity compensation plans approved by security holders | | | 15,456,321 | (1) | | | $ | 88.31 | (2) | | | 6,404,210 | (3) | | ||
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Equity compensation plans not approved by security holders | | | — | | | | — | | | | — | | | |||
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Total | | | 15,456,321 | | | | $ | 88.31 | | | | 6,404,210 | | | ||
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In March 2021, the Board approved amendments to the Amended and Restated 2010 Stock Incentive Plan (referred to in this proposal description as the "2010 Plan"), subject to the approval of our stockholders at the Annual Meeting, to increase the number of shares available for issuance by 9,500,000 shares, extend the term of the 2010 Plan by five years, and modify the annual grants to our nonemployee directors.
Incyte has continued to grow at a significant rate. As our revenue and our discovery and development pipeline have substantially increased over the last several years, so too has our number of employees. Our 2016 expansion into Europe and our 2017 expansion into Japan has also contributed to our increasing employee headcount.
Even though our employee headcount has risen substantially in the last several years, including in 2020, we have carefully managed the 2010 Plan to ensure that stockholders are subject to minimal dilution and that there is as little overhang as possible on our common stock. In fact, as the chart below shows, since the 2019 amendment to the 2010 Plan that added 7,700,000 shares, our overhang percentage remains low, at 9.5%, and our 3-year average burn rate is 2.7% (assuming that each full value award equates to 2.0 shares and each stock option award equates to 1.0 share), all while our employee headcount has grown by 30% over the past three years.
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Further detail of our year-end overhang percentage is set forth in the table below:
2017 | 2018 | 2019 | 2020 | ||||||||||
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Overhang: | |||||||||||||
Options and awards available for grant | 4,678,903 | 7,023,328 | 9,882,122 | 5,515,182 | |||||||||
Options and awards outstanding | 12,385,213 | 14,328,496 | 15,235,033 | 15,399,871 | |||||||||
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Total overhang | 17,064,116 | 21,351,824 | 25,117,155 | 20,915,053 | |||||||||
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Common outstanding shares | 211,262,906 | 213,274,660 | 216,177,830 | 219,489,329 | |||||||||
Overhang Percentage | 8.1 | % | 10.0 | % | 11.6 | % | 9.5 | % |
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We believe that we have been careful stewards
Independent Registered Public
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The first amendment to the 2010 Plan approved by the Board and submitted for stockholder approval consists of an increase in the number of shares available for issuance thereunder by 9,500,000 shares, from 44,453,475 shares to 53,953,475 shares.
The proposed increase of 9,500,000 in the number of shares reserved for issuance under the 2010 Plan is needed to allow us to continue to provide effective and appropriate equity incentives to our growing number of employees and our directors. Our equity awards have historically consisted of stock options, RSUs and performance shares. Our Board and the Compensation Committee of the Board have believed that equity awards align compensation incentives with stockholder interests, provide at-risk compensation for management by providing them with a strong incentive to improve the Company's performance, and provide employees with the opportunity to benefit significantly from the success of the Company. We offer equity awards to all new hires and have found that attractive and competitive initial equity awards are often an important inducement for the high-performing, entrepreneurial individuals who we believe are key to our success. We expect to continue to expand our workforce in support of our research and development and commercialization efforts as we execute on our long-term growth strategy. As we recruit to fill these new positions, the amount of shares required for initial awards to new hires, together with the amount required for annual awards to existing employees, in each case consistent with our historical practices, increases.
We do not believe the proposed 9,500,000 share increase will be unduly dilutive to stockholders. A common measure of potential dilution from outstanding equity awards is "overhang," generally defined as equity awards outstanding but not exercised, plus equity awards available to be granted (together referred to as potential equity award shares), divided by the common shares outstanding. As of March 29, 2021, our overhang was 9.2%, as compared with 11.1% as of March 31, 2020. We believe that our overhang has been reduced as a result of our equity award guidelines that were implemented in January 2014 and July 2016, pursuant to which the number of stock option awards was reduced through the use of RSUs and performance shares. For our annual awards and new employee awards beginning in July 2016, each U.S. recipient received a mix of stock options and RSUs, with the value as of the grant date of the options equal to 662/3% (75% for our executive officers), and the value of the shares underlying the RSU award equal to 331/3% (25% for our executive officers), of the aggregate value of such options and shares, in each case as determined under generally accepted accounting principles consistent with the valuation of our Company's equity incentives. In 2018, we changed the 25% portion of our executive officer awards from RSUs to performance shares, which combine the time-based vesting aspects of RSUs with performance-based vesting requirements, and in 2019, our executive officers received their annual awards in a mix of 50% stock options, 25% performance shares and 25% RSUs. In 2020, our U.S.-based executive officer annual awards consisted of a mix of 40% stock options, 30%
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performance shares and 30% RSUs, and the same mix will be used for the 2021 annual awards. Non-U.S. recipients only receive RSUs.
The second amendment approved by the Board and submitted for stockholder approval is an extension of the termination date of the 2010 Plan, from June 30, 2021 to June 30, 2026. This will allow us to continue using the 2010 Plan for equity awards through the date of our annual meeting of stockholders in 2026.
The third amendment approved by the Board and submitted for stockholder approval is a change to the annual grants to our nonemployee ("outside") directors. Each of these directors currently receives an annual grant having an aggregate grant date fair value of $500,000 and entitling the recipient to receive a mix of stock options and RSUs, with the value as of the grant date of the options equal to 75% and the value of the shares underlying the RSU award equal to 25% of the aggregate grant date fair value, in each case as determined under generally accepted accounting principles consistent with the valuation of our Company's equity incentives. The amendment would give the Board discretion to set the aggregate grant date fair value of the annual grant, provided that the value does not exceed the current limit of $500,000. For the 2021 annual grants, the Board has determined that the aggregate grant date fair value of each grant would be $400,000. In addition, the amendment would change the mix of the annual grants from 75% stock options and 25% RSUs to 60% stock options and 40% RSUs. The methodology for applying these percentages to determine the specific numbers of shares subject to the stock options and RSUs each year will remain unchanged and is described below under "2010 Stock Incentive Plan—Automatic Annual Grants to Directors."
The following summary of the principal features of the 2010 Plan, as amended, is qualified by reference to the terms of the plan, a copy of which is available without charge upon stockholder request to Secretary, Incyte Corporation, 1801 Augustine Cut-Off, Wilmington, Delaware 19803. The 2010 Plan, as amended, has also been filed electronically with the Securities and Exchange Commission together with this Proxy Statement, and can be accessed on the SEC's website at http://www.sec.gov.
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The 2010 Plan was initially adopted by the Board in March 2010 and approved by our stockholders in May 2010. It was last amended and restated by the Board in April 2013 and our stockholders approved the amended and restated 2010 Plan in May 2013. The Board further amended the 2010 Plan in 2014, 2016, 2018, and 2019, and our stockholders approved each of those amendments.
The purpose of the 2010 Plan is to assist in the recruitment, retention and motivation of employees, outside directors and consultants who are in a position to make material contributions to our long-term success and the creation of stockholder value. The 2010 Plan offers a significant incentive to encourage our employees, outside directors and consultants by enabling those individuals to acquire shares of our common stock, thereby increasing their proprietary interest in the growth and success of our Company.
The 2010 Plan provides for the direct award or sale of shares of common stock (including restricted shares), the award of RSUs and stock appreciation rights, the award of performance shares and the grant of incentive stock options to purchase common stock intended to qualify for preferential tax treatment under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), and nonstatutory stock options to purchase common stock that do not qualify for such treatment under the Code. All employees, including officers, of the Company or any subsidiary, non-employee directors of the Company and any consultant who performs services for the Company or any subsidiary are eligible to purchase shares of common stock and to receive awards of shares, restricted shares, performance shares, RSUs or stock appreciation rights or grants of nonstatutory stock options. Only employees are eligible to receive grants of incentive stock options. As of December 31, 2020, 1,773 employees (including officers) and non-employee directors would have been eligible to purchase common stock and to receive awards under the 2010 Plan.
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The 2010 Plan is administered by the Compensation Committee. Subject to the limitations set forth in the plan, the Compensation Committee has the authority to determine, among other things, to whom awards will be granted, the number of shares subject to awards, the term during which an option or stock appreciation right
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may be exercised and the rate at which the awards may vest or be earned, including any performance criteria to which they may be subject. The Compensation Committee also has the authority to determine the consideration and methodology of payment for awards. The Board has created a secondary committee, the Non-Management Stock Option Committee, which is authorized to make awards and grants under the 2010 Plan to eligible individuals other than members of the Board, the "Section 16 officers," and employees who hold the title of Senior Vice President or above.
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A total of 44,453,475 shares of common stock are currently reserved for issuance under the 2010 Plan, and that total would increase to 53,953,475 shares if the proposed amendments to the 2010 Plan are approved by our stockholders at our Annual Meeting. As of March 29, 2021, the Company had outstanding options to purchase an aggregate of 12,508,925 shares of common stock (with exercise prices ranging from $18.97 to $138.52 per share) under the 2010 Plan, outstanding RSUs covering 2,920,166 shares, and outstanding performance shares pursuant to which a maximum of 721,664 shares could be issued and had 4,067,100 shares of common stock available for issuance under the 2010 Plan (or 13,567,100 shares of common stock including the 9,500,000 shares subject to stockholder approval at the Annual Meeting). As of March 29, 2021, the Company had outstanding options to purchase an aggregate of 12,508,925 shares of common stock under the 2010 Plan at a weighted average exercise price of $88.89 per share and with a weighted average remaining contractual term of 6.73 years. The 2010 Plan replaced the 1991 Stock Plan and the 1993 Directors' Stock Option Plan. Shares that are subject to awards that expire, terminate or are cancelled under either the 1991 Stock Plan or the 1993 Directors' Stock Option Plan will not be made available for future awards under the 2010 Plan. Other than outstanding options to purchase common stock under the 2010 Plan and outstanding RSUs and performance shares under the 2010 Plan, the Company had no other outstanding awards as of March 29, 2021, and no shares remain available for future issuance under either the 1991 Stock Plan or the 1993 Directors' Stock Option Plan. No one award recipient may receive awards under the 2010 Plan in any calendar year that relate to more than 800,000 shares of common stock. Each "full value" award such as an award of RSUs, restricted shares or performance shares (that is, any sales or awards of shares other than upon exercise of options or other than pursuant to sales at purchase prices at least equal to the fair market value of the shares) will reduce the total share pool available under the 2010 Plan by 2.0 shares, and each stock option and any other non-full value award will reduce the total share pool by 1.0 share for each underlying award share granted. In addition, other than automatic grants to outside directors, awards for no more than 5% of the total number of shares of common stock reserved for issuance under the 2010 Plan may vest sooner than 12 months from the date of grant.
These limitations shall be adjusted as appropriate and equitable in the event of a stock dividend, stock split, reclassification of stock or similar events. If an award made under the 2010 Plan expires without having been exercised in full, or if any restricted shares, RSUs or performance shares are forfeited or repurchased by Company due to failure to vest, then the corresponding shares will again become available for awards under the 2010 Plan. Upon the settlement of stock appreciation rights, all of the shares subject to any such stock appreciation right will reduce the number of shares available under the 2010 Plan, regardless of the number of shares actually issued. If any award is paid in cash rather than shares of common stock, the payment of cash will not reduce the number of available shares. The Company may grant awards under other plans or programs, which may be settled in shares of common stock issued under the 2010 Plan. Such shares shall be treated like shares issued in settlement of RSUs and, when issued, will reduce the number of shares of common stock available for issuance under the 2010 Plan.
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The terms of any grants of stock options under the 2010 Plan will be set forth in a stock option agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms and conditions of such option grants, which need not be identical. Stock options may provide for the accelerated exercisability in the event of the award recipient's death, disability, or retirement or other events and may provide for expiration prior to the end of its term in the event of the termination of the award recipient's service. The Compensation Committee may modify, extend or assume outstanding options or may accept the
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cancellation of outstanding options in return for the grant of new options for the same or a different number of shares and at the same or a different exercise price, or in return for the grant of the same or a different number of shares. However, outstanding options may not be modified to lower the exercise price, nor may outstanding options be assumed or accepted for cancellation in return for the grant of new options with a lower exercise price, unless approved by the Company's stockholders. In no event will the Company purchase or assume in exchange for cash any stock option whose exercise price exceeds the fair market value of the underlying shares of common stock.
The exercise price of each option will be set by the Compensation Committee, subject to the following limits. The exercise price of an incentive stock option cannot be less than 100% of the fair market value of a share of common stock on the date the option is granted, and in the event an option recipient is deemed to be a 10% owner of our Company or one of our subsidiaries, the exercise price of an incentive stock option cannot be less than 110% of the fair market value of a share of common stock on the date the option is granted. The exercise price of a nonstatutory stock option cannot be less than 100% of the fair market value of a share of common stock on the date the option is granted. On March 29, 2021, the closing price for our common stock on The Nasdaq Global Select Market was $81.10. The maximum period in which an option may be exercised will be fixed by the Compensation Committee and included in each stock option agreement but cannot exceed ten years in the case of an incentive stock option, and in the event an option recipient is deemed to be a 10% owner of our Company or one of our subsidiaries, the maximum period for an incentive stock option granted to that person cannot exceed five years. In addition, no option recipient may be granted incentive stock options that are exercisable for the first time in any calendar year for common stock having a total fair market value (determined as of the option grant) in excess of $100,000.
The exercise price for the exercise of a stock option may be paid in cash or, to the extent that the stock option agreement so provides, by surrendering shares of common stock, by delivery of an irrevocable direction to a securities broker to sell shares and to deliver all or part of the sale proceeds to the Company in payment of the aggregate exercise price, by delivery of an irrevocable direction to a securities broker or lender to pledge shares, as security for a loan, and to deliver all or part of the loan proceeds to the Company in payment of the aggregate exercise price, by delivering a full-recourse promissory note, or in any other form that is consistent with applicable laws, regulations and rules. Options generally will be nontransferable except in the event of the option recipient's death.
Stock options granted under the 2010 Plan must be exercised by the optionee before the expiration of such option. Each stock option agreement will set forth the extent to which the option recipient will have the right to exercise the option following the termination of the recipient's service with us, and the right to exercise the option of any executors or administrators of the award recipient's estate or any person who has acquired such options directly from the award recipient by bequest or inheritance.
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As discussed above under "Description of Amendments," each of our nonemployee ("outside") directors currently receives an annual grant following the conclusion of the Annual Meeting having an aggregate grant date fair value of $500,000 and entitling the recipient to receive a mix of stock options and RSUs, with the value as of the grant date of the options equal to 75% and the value of the shares underlying the RSU award equal to 25% of the aggregate grant date fair value, in each case as determined under generally accepted accounting principles consistent with the valuation of our Company's equity incentives. If the proposed amendments are approved by our stockholders at the Annual Meeting, the Board would have discretion to set the aggregate grant date fair value of each annual grant, provided that the value does not exceed the current limit of $500,000. For the 2021 annual grants, the Board has determined that the aggregate grant date fair value of each grant would be $400,000. In addition, the proposed amendments would change the mix of the annual grants from 75% stock options and 25% RSUs to 60% stock options and 40% RSUs. If the proposed amendments are approved by our stockholders, the number of shares subject to the nonstatutory options in each 2021 annual grant will be determined by dividing 60% of $400,000 (or $240,000) by the Black-Scholes value of one such option, based on the average closing sale price for our shares on The Nasdaq Global Select Market over the 30 consecutive trading days concluding with the last trading day prior to the grant date,
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rounded down to the nearest whole share. The number of shares subject to the RSUs in each 2021 annual grant will be determined by dividing 40% of $400,000 (or $160,000) by such 30 trading day average price, rounded down to the nearest whole share. The exercise price of the options will be equal to the fair market value on the date of the grant, and the options will have a term of ten years. Each outside director who is not initially elected at a regular annual meeting of our stockholders will receive awards within 10 business days of his or her election having an aggregate grant date fair value of a pro rata portion of $500,000 or such lower dollar limit then in effect for annual grants ($400,000 for 2021 annual grants, if the proposed amendments are approved by our stockholders), determined based on the number of full calendar months remaining from the date of election until the next regular annual meeting divided by 12. Such outside director's awards will consist of 60% nonstatutory options and 40% RSUs determined in a manner similar to that used for the annual awards to outside directors following the conclusion of the regular annual meeting, except that the values of the awards to such outside director will be determined as of the grant date of such awards. All annual awards to outside directors will vest (and in the case of options, become exercisable) on the earlier of the first anniversary of the date of grant or immediately prior to the next regular annual meeting of our stockholders.
Options granted to outside directors will become fully vested if a change in control occurs with respect to the Company during the director's service. The Board may from time to time increase the number of shares subject to an annual grant if the Board determines that the increase is necessary to induce individuals to become or remain non-employee directors, or to address an increase in the duties or responsibilities of a non-employee director. The Board may also determine that the exercise price of such an option shall be greater than the fair market value of the common stock on the date of grant and that the option shall be exercisable on a different schedule than stated above.
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The terms of any awards of restricted shares under the 2010 Plan will be set forth in a restricted share agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms and conditions of the restricted share agreements, which need not be identical. Restricted share awards generally will be subject to vesting requirements of a minimum period of three years, and may be subject to transfer restrictions. Award recipients who are granted restricted shares generally have all of the rights of a stockholder with respect to those shares. Restricted shares may be issued for consideration as the Compensation Committee may determine, including cash, cash equivalents, full-recourse promissory notes, past services and future services.
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The terms of any awards of RSUs under the 2010 Plan will be set forth in an RSU agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms and conditions of the RSU agreements, which need not be identical. RSUs give an award recipient the right to acquire a specified number of shares of common stock, or at the Compensation Committee's discretion, cash, or a combination of common stock and cash, at a future date upon the satisfaction of certain vesting conditions based upon a vesting schedule or performance criteria established by the Compensation Committee. RSUs generally will be subject to vesting requirements of a minimum period of three years. RSUs may be granted in consideration of a reduction in the award recipient's other compensation, but no cash consideration is required of the award recipient. Unlike restricted shares, the stock underlying RSUs will not be issued until the stock units have vested, and recipients of RSUs generally will have no voting or dividend rights prior to the time of issuance of any common stock upon settlement.
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The terms of any awards of stock appreciation rights under the 2010 Plan will be set forth in an agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms, conditions and restrictions of any such agreements, which need not be identical. A stock appreciation right generally entitles the award recipient to receive a payment upon exercise equal to the amount by which the fair market value of a share of common stock on the date of exercise exceeds the value of a share of
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common stock on the date of grant. The exercise price of a stock appreciation right cannot be less than 100% of the fair market value of a share of common stock on the date the stock appreciation right is granted. The amount payable upon the exercise of a stock appreciation right may be settled in cash or by the issuance of shares of common stock.
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The terms of any awards of performance shares under the 2010 Plan will be set forth in an agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms, conditions and restrictions of any such agreements, which need not be identical.
Performance shares give an award recipient the right to acquire a specified number of shares of common stock, or at the Compensation Committee's discretion, cash, or a combination of common stock and cash, at a future date, based on performance criteria set forth in the performance share agreement. The actual number of performance shares eligible for settlement may be larger or smaller than the number included in the original award, based on the performance criteria. Performance shares may be granted in consideration of a reduction in the award recipient's other compensation, but no cash consideration is required of the award recipient. An award of performance shares generally will vest only if the award recipient performs services for the entire performance period (or if less, one year). Recipients of performance shares generally will have no voting or dividend rights prior to the time of issuance of any common stock upon settlement.
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The 2010 Plan sets forth performance criteria that may be used in the case of performance shares and certain other awards intended to qualify for the "performance-based compensation" exemption from the corporate deduction limit under Section 162(m) of the Code. The "performance-based compensation" exemption has been repealed effective for tax years beginning after December 31, 2017, subject to certain transition rules for previously granted awards, as described below under "Certain Federal Income Tax Aspects of Awards Under the Plan—Code Section 162(m)." The Compensation Committee may, but is not required to, apply the performance criteria set forth in the 2010 Plan to performance shares and other awards granted in 2021 and future years.
To qualify as a "performance-based compensation," the number of shares or other benefits granted, issued, retainable or vested under an award may be made subject to the attainment of performance goals for a specified period of time relating to one or more of the following performance criteria, either individually, alternatively or in any combination, applied to either us as a whole or to a business unit or subsidiary, either individually, alternatively or in any combination, and measured either annually or cumulatively over a period of years, on an absolute basis or relative to a pre-established target, to previous years' or quarter's results or to the performance of one or more comparable companies or a designated comparison group or index, in each case as specified by the Compensation Committee in the award: (a) cash flow (including operating cash flow), (b) earnings per share, (c) earnings before any combination of interest, taxes, depreciation, or amortization, (d) return on equity, (e) total stockholder return, (f) share price performance, (g) return on capital, (h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating income or net operating income, (l) operating profit or net operating profit, (m) operating margin or profit margin (including as a percentage of revenue), (n) return on operating revenue, (o) return on invested capital, (p) market segment shares, (q) economic profit, (r) achievement of target levels of discovery and/or development of products, including but not limited to regulatory achievements, (s) achievement of research and development objectives, and (t) formation of joint ventures, strategic relationships or other commercial, research or development collaborations. The Compensation Committee may appropriately adjust any evaluation of performance under a qualifying performance criteria to exclude any of the following events that occur during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) any extraordinary, nonrecurring items disclosed in the Company's financial statements or in management's discussion and analysis of financial condition and results of operations appearing in our annual report to stockholders for the applicable year. If applicable, the Compensation
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Committee will determine the qualifying performance criteria and any permitted exclusions for events described in the preceding sentence not later than the 90th day of the performance period, and will determine and certify the extent to which the qualifying performance criteria have been met. For awards intended to qualify as "performance-based compensation" under Section 162(m) of the Code, the Compensation Committee may not in any event increase the amount of compensation payable under the 2010 Plan upon the attainment of qualifying performance criteria to an award recipient who is a "covered employee" within the meaning of Section 162(m) of the Code.
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No awards may be granted under the 2010 Plan after June 30, 2021 or, if the proposed amendments are approved by our stockholders, after June 30, 2026. The Board may amend or terminate the 2010 Plan at any time, but an amendment will not become effective without the approval of the Company's stockholders to the extent required by applicable laws, regulations or rules. No amendment or termination of the 2010 Plan will affect an award recipient's rights under outstanding awards without the award recipient's consent.
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In the event of a subdivision of the outstanding common stock or a combination or consolidation of the outstanding common stock (by reclassification or otherwise) into a lesser number of shares, a spin-off or a similar occurrence, or declaration of a dividend payable in common stock or, if in an amount that has a material effect on the price of the shares, in cash, the Compensation Committee will make appropriate adjustments in the number of shares covered by outstanding awards and the exercise price of outstanding options and stock appreciation rights, and the number of shares available under the 2010 Plan.
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This is a brief summary of the federal income tax aspects of awards that may be made under the 2010 Plan based on existing U.S. federal income tax laws. This summary provides only the basic tax rules. It does not describe a number of special tax rules, including the alternative minimum tax and various elections that may be applicable under certain circumstances. It also does not reflect provisions of the income tax laws of any municipality, state or foreign country in which a holder may reside, nor does it reflect the tax consequences of a holder's death. The tax consequences of awards under 2010 Plan depend upon the type of award and, if the award is to an executive officer, whether compensation paid to the officer is subject to the tax deduction limit imposed by Section 162(m) of the Code.
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The recipient of an incentive stock option generally will not be taxed upon grant of the option. Federal income taxes are generally imposed only when the shares of common stock from exercised incentive stock options are disposed of, by sale or otherwise. The amount by which the fair market value of the common stock on the date of exercise exceeds the exercise price is, however, included in determining the option recipient's liability for the alternative minimum tax. If the incentive stock option recipient does not sell or dispose of the shares of common stock until more than one year after the receipt of the shares and two years after the option was granted, then, upon sale or disposition of the shares, the difference between the exercise price and the market value of the shares of common stock as of the date of exercise will be treated as a capital gain, and not ordinary income. If a recipient fails to hold the shares for the minimum required time the recipient will recognize ordinary income in the year of disposition generally in an amount equal to any excess of the market value of the common stock on the date of exercise (or, if less, the amount realized or disposition of the shares) over the exercise price paid for the shares. Any further gain (or loss) realized by the recipient generally will be taxed as short-term or long-term gain (or loss) depending on the holding period. We will generally be entitled to a tax deduction at the same time and in the same amount as ordinary income is recognized by the option recipient.
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The recipient of stock options not qualifying as incentive stock options generally will not be taxed upon the grant of the option. Federal income taxes are generally due from a recipient of nonstatutory stock options when the stock options are exercised. The excess of the fair market value of the common stock purchased on such date over the exercise price of the option is taxed as ordinary income. Thereafter, the tax basis for the acquired shares is equal to the amount paid for the shares plus the amount of ordinary income recognized by the recipient. We will generally be entitled to a tax deduction at the same time and in the same amount as ordinary income is recognized by the option recipient by reason of the exercise of the option.
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Recipients who receive RSU awards will generally recognize ordinary income when they receive shares upon settlement of the awards, in an amount equal to the fair market value of the shares at that time. Recipients who receive awards of restricted shares subject to a vesting requirement will generally recognize ordinary income at the time vesting occurs, in an amount equal to the fair market value of the shares at that time minus the amount, if any, paid for the shares. However, a recipient who receives restricted shares which are not vested may, within 30 days of the date the shares are transferred, elect in accordance with Section 83(b) of the Code to recognize ordinary compensation income at the time of transfer of the shares rather than upon the vesting dates. Recipients who receive stock appreciation rights will generally recognize ordinary income upon exercise in an amount equal to the excess of the fair market value of the underlying shares of common stock on the exercise date and cash received, if any, over the exercise price. Recipients who receive performance shares will generally recognize ordinary income at the time of settlement, in an amount equal to the cash received, if any, and the fair market value of any shares received. We will generally be entitled to a tax deduction at the same time and in the same amount as ordinary income is recognized by the recipient.
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Section 162(m) of the Code generally disallows a tax deduction to us for annual compensation in excess of $1,000,000 paid to certain executive officers. Prior to 2018, however, we could deduct compensation above $1,000,000 if it was "performance-based compensation" within the meaning of Section 162(m). Stock options and performance shares granted prior to 2018 were intended to qualify as performance-based compensation.
The Section 162(m) exemption for performance-based compensation has been repealed, effective for tax years beginning after December 31, 2017, subject to a transition rule for amounts payable pursuant to written binding contracts in effect on November 2, 2017. We believe that outstanding stock options granted prior to November 2, 2017 qualify for this transition rule, and thus retain their status as deductible performance-based compensation.
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Other than to set the grant date target value for the annual equity awards to be made in July 2021 of $12,400,000 for our CEO and $2,200,000 for our other U.S.-based executive officers, as described under "Compensation Discussion and Analysis—Key Elements of Executive Compensation—Equity-Based Incentive Awards," the Compensation Committee has not made any determination with respect to future awards under the 2010 Plan and, except for automatic grants to non-employee "outside" directors, awards and the terms of any awards under the plan for the current year or any future year are not determinable. As described above, the 2010 Plan provides for the automatic grant of awards to outside directors. If our stockholders approve the proposed amendments to the 2010 Plan, each outside director nominee who will continue to serve as a member of the Board will receive a grant consisting of 60% nonstatutory options and 40% RSUs having an aggregate grant date fair value of $500,000 or such lower dollar amount as may be selected by the Board. The Board has limited the aggregate grant date fair market value of each outside director's 2021 annual grant to $400,000.
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Approval of the amendments to the 2010 Plan requires the affirmative vote of a majority of the shares present and entitled to vote.
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The Audit and Finance Committee has appointed the firm of Ernst & Young LLP as the Company'sCompany’s independent registered public accounting firm for the fiscal year ending December 31, 2021,2022, subject to reconsideration by the Audit and Finance Committee should our stockholders fail to ratify such appointment at the Annual Meeting or should the Audit and Finance Committee not approve Ernst & Young LLP'sLLP’s audit plan for the fiscal year ending December 31, 2021.2022. Ernst & Young LLP has audited our financial statements since the Company'sCompany’s inception in 1991. Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting. They will have an opportunity to make a statement, if they desire to do so, and will be available to respond to appropriate questions.
Principal Accountant Fees and Services |
The following table sets forth the aggregate fees billed or expected to be billed by Ernst & Young LLP for audit and other services rendered.
| | | Year Ended December 31 | | |||||||||
| | | 2021 | | | 2020 | | ||||||
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Audit Fees(1) | | | | $ | 2,447 | | | | | $ | 2,297 | | |
Audit-related Fees(2) | | | | $ | 218 | | | | | | — | | |
Year Ended December 31, | |||||||
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2020 | 2019 | ||||||
(in thousands) | |||||||
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Audit Fees(1) | $ | 2,297 | $ | 2,290 | |||
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Pre-Approval Policies and Procedures |
The Audit and Finance Committee has established a policy to pre-approve all audit and permissible non-audit services provided by the Company'sCompany’s independent registered public accounting firm. All of the services provided by the Company'sCompany’s independent registered public accounting firm in 20202021 and 20192020 were pre-approved.
Required Vote |
Ratification will require the affirmative vote of a majority of the shares present and entitled to vote. Stockholder ratification of the selection of Ernst & Young LLP as the Company'sCompany’s independent registered public accounting firm is not required by the Company'sCompany’s Bylaws or otherwise. However, the Board is submitting the selection of Ernst & Young LLP to the stockholders for ratification as a matter of corporate practice. If the stockholders fail to ratify the selection, the Audit and Finance Committee will reconsider whether or not to retain that firm. Even if the selection is ratified, the Audit and Finance Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if the Audit and Finance Committee determines that such a change would be in the best interests of the Company and its stockholders.
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Name and Address of Beneficial Owner(1) | | | Shares Beneficially Owned (#)(1) | | | Percentages Beneficially Owned (%)(1) | | ||||||
5% Stockholders | | | | | | | | | | | | | |
Felix J. Baker(2) | | | | | 36,644,727 | | | | | | 16.5 | | |
Baker Bros. Advisors LP and affiliated entities(2) | | | | | 36,279,680 | | | | | | 16.4 | | |
The Vanguard Group and affiliates(3) | | | | | 20,944,759 | | | | | | 9.5 | | |
BlackRock, Inc.(4) | | | | | 18,336,658 | | | | | | 8.3 | | |
Dodge & Cox (5) | | | | | 16,657,586 | | | | | | 7.5 | | |
Named Executive Officers and Directors | | | | | | | | | | | | | |
Hervé Hoppenot(6) | | | | | 1,109,774 | | | | | | * | | |
Christiana Stamoulis(7) | | | | | 101,636 | | | | | | * | | |
Steven H. Stein(8) | | | | | 185,441 | | | | | | * | | |
Barry P. Flannelly(9) | | | | | 132,653 | | | | | | * | | |
Maria E. Pasquale(10) | | | | | 85,520 | | | | | | * | | |
Julian C. Baker(2) | | | | | 36,642,310 | | | | | | 16.5 | | |
Jean-Jacques Bienaimé(11) | | | | | 131,840 | | | | | | * | | |
Otis W. Brawley (12) | | | | | 7,165 | | | | | | * | | |
Paul J. Clancy(13) | | | | | 129,286 | | | | | | * | | |
Wendy L. Dixon(14) | | | | | 143,764 | | | | | | * | | |
Jacqualyn A. Fouse(15) | | | | | 88,257 | | | | | | * | | |
Edmund P. Harrigan(16) | | | | | 28,456 | | | | | | * | | |
Katherine A. High(17) | | | | | 15,143 | | | | | | * | | |
All directors and executive officers as a group (18 persons)(18) | | | | | 39,245,152 | | | | | | 17.5 | | |
Name and Address of Beneficial Owner(1) | Shares Beneficially Owned(#)(1) | Percentages Beneficially Owned(%)(1) | |||||
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5% Stockholders | |||||||
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Felix J. Baker(2) | 32,524,056 | 14.8 | |||||
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Baker Bros. Advisors LP and affiliated entities(2) | 32,159,009 | 14.6 | |||||
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T. Rowe Price Associates, Inc.(3) | 32,594,682 | 14.8 | |||||
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The Vanguard Group and affiliates(4) | 20,156,224 | 9.2 | |||||
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BlackRock, Inc.(5) | 17,808,827 | 8.1 | |||||
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Wellington Management Group LLP(6) | 13,499,976 | 6.1 | |||||
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Named Executive Officers and Directors | |||||||
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Hervé Hoppenot(7) | 872,576 | * | |||||
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Christiana Stamoulis(8) | 56,506 | * | |||||
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Barry P. Flannelly(9) | 136,857 | * | |||||
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Steven H. Stein(10) | 97,952 | * | |||||
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Vijay Iyengar(11) | 101,751 | * | |||||
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Julian C. Baker(2) | 32,521,639 | 14.8 | |||||
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Jean-Jacques Bienaimé(12) | 121,907 | * | |||||
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Paul J. Clancy(13) | 117,782 | * | |||||
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Wendy L. Dixon(14) | 152,639 | * | |||||
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Jacqualyn A. Fouse(15) | 73,870 | * | |||||
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Paul A. Friedman(16) | 377,299 | * | |||||
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Edmund P. Harrigan(17) | 17,366 | * | |||||
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Katherine A. High(18) | 13,220 | * | |||||
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All directors and executive officers as a group (19 persons)(19) | 35,168,046 | 15.8 | |||||
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| 80|Proxy Statement 2022 | | | |
| Security Ownership of Certain Beneficial Owners and Management | |
Holder | |||||||
---|---|---|---|---|---|---|---|
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667, L.P. | |||||||
| | | | 2,734,189 | | | |
Baker Brothers Life Sciences, L.P. | |||||||
| | | | 33,212,097 | | | |
Julian C. Baker | |||||||
| | | | 484,248 | | | |
Felix J. Baker | |||||||
| | | | 281,190 | | | |
Entities affiliated with Julian C. Baker and Felix J. Baker | |||||||
| | | | 83,857 | | |
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Section 16(a) Beneficial Ownership Reporting Compliance |
Under the securities laws of the United States, our directors, executive officers and any persons holding more than 10% of our common stock are required to report their initial ownership of our common stock and any subsequent changes in that ownership to the Securities and Exchange Commission. Specific due dates for these reports have been established and we are required to identify in this Proxy Statement those persons who failed to timely file these reports. Based solely on our review of the copies of such forms received by us, or written representation from certain reporting persons, we believe that all of the filing requirements for such persons were satisfied for 2020.
Stockholder Proposals for the 2023 Annual Meeting |
To be considered for inclusion in the Company'sCompany’s proxy statement for the Company's 2022Company’s 2023 Annual Meeting of Stockholders, stockholder proposals must be received by the Secretary of the Company no later than December 17, 2021.30, 2022. These proposals also must comply with the proxy proposal submission rules of the Securities and Exchange Commission under Rule 14a-8.
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Annual Report |
We will furnish without charge, upon written request of any person who was a stockholder or beneficial owner of common stock at the close of business on March 29, 2021,April 18, 2022, the record date, a copy of our Annual Report on Form 10-K, including the financial statements, the financial statement schedules, and all exhibits. The written request should be sent to: Investor Relations Department, Incyte Corporation, 1801 Augustine Cut-Off, Wilmington, DE 19803.
April 16, 2021
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Proxy Statement | |
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We do not expect any other items of business because the deadline for stockholder proposals and nominations has already passed. Nonetheless, in case there is an unforeseen need, the accompanying proxy gives discretionary authority to the persons named on the proxy with respect to any other matters that might be brought before the meeting. Those persons intend to vote that proxy in accordance with their best judgment.
Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials? |
We have elected to provide access to our proxy materials over the Internet, as permitted by the rules of the SEC. Accordingly, in most instances we are mailing a Notice of Internet Availability of Proxy Materials (Proxy Availability Notice) to our stockholders. All stockholders will have the ability to access our proxy materials on the website referred to in the Proxy Availability Notice or may request to receive printed versions of our proxy materials for the Annual Meeting. Instructions on how to access the proxy materials over the Internet or to request a printed copy may be found in the Proxy Availability Notice.
What does it mean if I receive more than one notice regarding the Internet availability of proxy materials or more than one set of printed proxy materials? |
If you hold your shares in more than one account, you may receive a separate Proxy Availability Notice or a separate set of printed proxy materials, including a separate proxy voting card or voting instruction form, for each account. Please follow the voting instructions on each Proxy Availability Notice toTo ensure that all of your shares are voted.
voted, please vote by telephone or by Internet or sign, date and return a proxy card or voting instruction form for each account.
Who is entitled to vote? |
Stockholders of record at the close of business on March 29, 2021,April 18, 2022, the Record Date, may vote at the Annual Meeting. Each stockholder is entitled to one vote for each share of our common stock held by such stockholder as of the Record Date.
How many shares must be present to hold the Annual Meeting? |
The presence, in person or by proxy, of the holders of a majority of our outstanding common stock on the Record Date constitutes a quorum, which is required to hold and conduct business at the Annual Meeting. As of the close of business on the Record Date, there were 219,876,892221,496,070 shares of our common stock outstanding. If you are a record holder and you submit your proxy, regardless of whether you abstain from voting on one or more matters, your shares will be counted as present at the Annual Meeting for purposes of determining a quorum. If your shares are held in street name, your shares are counted as present for purposes of determining a quorum if your broker, bank or other nominee submits a proxy covering your shares. Your broker, bank or other nominee is entitled to submit a proxy covering your shares as to certain "routine"“routine” matters, even if you have not instructed your broker, bank or other nominee on how to vote on those matters. Please see "How“How are votes counted?"” below. If a quorum is not present, we expect that the Annual Meeting will be adjourned until we obtain a quorum.
What is the difference between holding shares as a stockholder of record and as a beneficial owner? |
Stockholder of Record. If your shares are registered directly in your name with our transfer agent, Computershare, you are considered, with respect to those shares, the "stockholder“stockholder of record."” This Proxy Statement, our Annual Report and the proxy card have been sent directly to you by Incyte.
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| Frequently Asked Questions | |
Beneficial Owner. If your shares are held in a stock brokerage account or by a broker, bank or other nominee, you are considered the "beneficial owner"“beneficial owner” of shares held in street name. This Proxy Statement and our Annual Report have been forwarded to you by your broker, bank or other nominee who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker, bank or other nominee how to vote your shares by using the voting instruction form provided by your broker, bank or other nominee.
How do I vote? |
You may vote using any of the following methods:
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By Mail | | | By Telephone | | | By Internet | | | In Person at the Annual Meeting* | | |
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| Mail | | | Telephone | | | By Internet | | | In Person at the Annual Meeting | |
| | | | Most stockholders who hold shares beneficially in street name may provide voting instructions to their brokers, banks or other nominees by telephone by calling the number specified on the voting instruction form provided by their brokers, banks or other nominees. The telephone voting facilities will close at 11: | | | Most stockholders who hold shares beneficially in street name may provide voting instructions to their brokers, banks or other nominees by accessing the website specified on the voting instruction form provided by their brokers, banks or other nominees. The internet voting facilities will close at 11: | | | Even if you plan to attend the Annual Meeting, we recommend that you also submit your proxy or voting instructions or vote by telephone or the internet so that your vote will be counted if you later decide not to attend the meeting. | |
Please note that Incyte requires all visitors to provide proof of COVID-19 vaccination.
Can I change my vote or revoke my proxy? |
You may change your vote or revoke your proxy at any time prior to the vote at the Annual Meeting. If you submitted your proxy by mail, you must file with the Secretary of our Company a written notice of revocation or deliver, prior to the vote at the Annual Meeting, a valid, later dated proxy. If you submitted your proxy by telephone or the internet, you may change your vote or revoke your proxy with a later telephone or internet proxy, as the case may be. Attendance at the Annual Meeting will not have the effect of revoking a proxy unless you give written notice of revocation to the Secretary before the proxy is exercised or you vote by written ballot at the Annual Meeting. For shares you hold beneficially in street name, you may change your vote or revoke your proxy by submitting new voting instructions to or informing your broker, bank or other nominee in accordance that entity'sentity’s procedures for changing or revoking your voting instructions.
How are votes counted? |
In the election of directors, you may vote "FOR," "AGAINST"“FOR,” “AGAINST” or "ABSTAIN"“ABSTAIN” for each nominee. For each of Proposals 2 3, and 4,3, you may vote "FOR," "AGAINST"“FOR,” “AGAINST” or "ABSTAIN."
“ABSTAIN.”
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Proxy Statement | |
| Frequently Asked Questions | |
If you hold shares beneficially in street name and do not provide your broker, bank or other nominee with voting instructions, your shares may constitute "broker“broker non-votes."” Generally, broker non-votes occur on a matter when a broker, bank or other nominee is not permitted to vote on that matter without instructions from the beneficial owner and instructions are not given. If you hold shares beneficially in street name and do not vote your shares, your broker, bank or other nominee can vote your shares at its discretion only on Proposal 4,3, the ratification of the independent registered public accounting firm. In tabulating the voting result for any particular proposal, shares that constitute broker non-votes are not considered entitled to vote on that proposal. Thus, broker non-votes will not affect the outcome of any matter being voted on at the Annual Meeting, other than Proposal 4,3, assuming that a quorum is obtained.
What vote is required to approve each item? |
We have a majority voting standard for the election of directors in an uncontested election, which is generally defined as an election in which the number of nominees does not exceed the number of directors to be elected at the meeting. Cumulative voting is not permitted, which means that each stockholder may vote no more than the number of shares he or she owns for a single director candidate. Under our majority voting standard, in uncontested elections of directors, such as this election, each director must be elected by the affirmative vote of a majority of the votes cast by the shares present in person or represented by proxy. A "majority“majority of the votes cast"cast” means that the number of votes cast "FOR"“FOR” a director nominee exceeds the number of votes cast "AGAINST"“AGAINST” the nominee. If a director nominee is an incumbent director and does not receive a majority of the votes cast in an uncontested election, that director will continue to serve on the Board as a "holdover"“holdover” director, but will be subject to our director resignation policy. Additional information concerning our director resignation policy is set forth under the heading "Corporate“Corporate Governance—Majority Voting Policy."
”
Proposal | | | ||||||||||||
Vote Required | | | Effect of | Abstentions(1) | | | Broker Discretionary Voting Allowed?(2) | |||||||
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1 | | | ||||||||||||
Election of Directors | | | A nominee for director will be elected if the votes cast | | | No effect Not considered votes cast on this proposal | | | No Brokers without voting instructions will not be able to vote on this proposal | |||||
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2 | | | ||||||||||||
Advisory Vote to Approve Executive Compensation | | | Non-binding, advisory proposal. We will consider the matter approved if it receives the affirmative vote of a majority of the shares of common stock present at the Annual Meeting in person or by proxy and entitled to vote on this proposal. | | | Counted as vote Same effect as votes against | | | No Brokers without voting instructions will not be able to vote on this proposal | |||||
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3 | | | Ratification of the Appointment of Ernst & Young LLP | | | |||||||||
The affirmative | | | Counted as vote Same effect as votes against | |||||||||||
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Yes Brokers without voting instructions will have discretionary authority to vote | ||||||||||||||
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We have adopted a process for mailing our Annual Report and this Proxy Statement called "householding,"“householding,” which has been approved by the Securities and Exchange Commission. Householding means that stockholders who share
| 86|Proxy Statement 2022 | | | |
| Frequently Asked Questions | |
How are proxies solicited? |
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Note Regarding Forward-Looking Statements |
Except for the historical information set forth herein, the matters set forth in this proxy statement contain predictions, estimates and other forward-looking statements, including without limitation statements regarding: the expected timing of an FDA decision on the sNDA for ruxolitinib for stereo-refractory chronic GVHD;our expectation that our 2021 new product launches will contribute more meaningfully to revenue going forward; our expectations regarding the submission of once-a-day ruxolitinib to the FDA and the timing of any related FDA decision;FDA; our expectations regarding the size of the opportunity for commercial successruxolitinib cream in vitiligo and other indications; our expectations regarding expanded development and additional trials of Monjuvi;axatilimab; our expectations regarding selecting a lead PD-L1 program; our expectations with respect to initiation of clinical trials for ourbecoming an operationally carbon neutral organization and our collaborative partners' drug candidates; our expectations regarding the submission of an NDA for parsaclisib; expectations regarding the timing of an FDA decision on the BLA for retifanlimab; expectations regarding FDA approval and timing thereof of ruxolitinib cream in mild-to-moderate atopic dermatitis and the sNDA for vitiligo; expectations regarding the timing of regulatory decisions for the application for approval of tafasitamab for diffuse-large B-cell lymphoma in Europe; expectations of our collaborative partners regarding regulatory submissions;means to achieve that goal; our expectations regarding our inclusion commitmentability to achieve our goal of transitioning our fleet to hybrid or electric vehicles and increasing opportunities for ethnic minorities;the timing of our expectations with respect to our environmental disclosures and environmental impact;report under TCFD; our expectations regarding our global responsibility initiative; and our beliefs regarding the benefits and effects of our compensation policies and methods.
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INCYTE CORPORATIONAMENDED AND RESTATED 2010 STOCK INCENTIVE PLAN(As Amended and Restated on March 23, 2021)
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- iii -
INCYTE CORPORATIONAMENDED AND RESTATED 2010 STOCK INCENTIVE PLAN
SECTION 1.ESTABLISHMENT AND PURPOSE.
The Plan was adopted by the Board of Directors on March 19, 2010, amended and restated on March 8, 2011, April 18, 2012, and April 17, 2013, amended on January 7, 2014, March 4, 2014, April 22, 2014, March 16, 2016, and March 2, 2018, and further amended and restated on March 18, 2019 and March 23, 2021. The purpose of the Plan is to promote the long-term success of the Corporation and the creation of stockholder value by (a) encouraging Employees, Outside Directors and Consultants to focus on critical long-range objectives, (b) encouraging the attraction and retention of Employees, Outside Directors and Consultants with exceptional qualifications and (c) linking Employees, Outside Directors and Consultants directly to stockholder interests through increased stock ownership. The Plan seeks to achieve this purpose by providing for Awards in the form of Restricted Shares, Restricted Stock Units, Performance Shares, Options (which may constitute ISOs or NSOs) and SARs.
SECTION 2.DEFINITIONS.
(a) "Affiliate" shall mean any entity other than a Subsidiary, if the Corporation and/or one or more Subsidiaries own not less than 50% of such entity.
(b) "Award" shall mean any award of an Option, a SAR, Restricted Shares, Restricted Stock Units or Performance Shares under the Plan.
(c) "Board of Directors" shall mean the Board of Directors of the Corporation, as constituted from time to time.
(d) "Change in Control" shall mean the occurrence of any of the following events:
For purposes of subsection (d)(ii) above, the term "person" shall have the same meaning as when used in Sections 13(d) and 14(d) of the Exchange Act but shall exclude (1) a trustee or other fiduciary holding securities
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under an employee benefit plan maintained by the Corporation or a Parent or Subsidiary and (2) a corporation owned directly or indirectly by the stockholders of the Corporation in substantially the same proportions as their ownership of the Stock.
Any other provision of this Section 2(d) notwithstanding, a transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Corporation's incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Corporation's securities immediately before such a transaction.
(e) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(f) "Committee" shall mean the committee designated by the Board of Directors to administer the Plan, as described in Section 3 hereof (or in the absence of such designation, the Board of Directors itself).
(g) "Corporation" shall mean Incyte Corporation, a Delaware corporation.
(h) "Consultant" shall mean a consultant or advisor who provides bona fide services to the Corporation, a Parent, a Subsidiary or an Affiliate as an independent contractor (not including service as a member of the Board of Directors) or a member of the board of directors of a Parent or a Subsidiary, in each case who is not an Employee.
(i) "Employee" shall mean any individual who is a common-law employee of the Corporation, a Parent, a Subsidiary or an Affiliate.
(j) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
(k) "Exercise Price" shall mean (a) in the case of an Option, the amount for which one Share may be purchased upon exercise of such Option, as specified in the applicable Stock Option Agreement, and (b) in the case of a SAR, an amount, as specified in the applicable SAR Agreement, which is subtracted from the Fair Market Value of one Share in determining the amount payable upon exercise of such SAR.
(l) "Fair Market Value" with respect to a Share, shall mean the market price of one Share, determined by the Committee as follows:
In all cases, the determination of Fair Market Value by the Committee shall be conclusive and binding on all persons.
(m) "ISO" shall mean an employee incentive stock option described in Section 422 of the Code.
(n) "Nonstatutory Option" or "NSO" shall mean an employee stock option that is not an ISO.
(o) "Offeree" shall mean an individual to whom the Committee has offered the right to acquire Shares under the Plan (other than upon exercise of an Option).
(p) "Option" shall mean an ISO or Nonstatutory Option granted under the Plan and entitling the holder to purchase Shares.
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(q) "Optionee" shall mean an individual or estate who holds an Option or SAR.
(r) "Outside Director" shall mean a member of the Board of Directors who is not an Employee or a Consultant.
(s) "Parent" shall mean any corporation or other entity (other than the Corporation) in an unbroken chain of corporations or other entities ending with the Corporation, if each of the corporations or other entities other than the Corporation owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. A corporation or other entity that attains the status of a Parent on a date after the adoption of the Plan shall be a Parent commencing as of such date.
(t) "Participant" shall mean an individual or estate who holds an Award.
(u) "Performance Shares" shall mean a bookkeeping entry representing the Corporation's obligation to deliver Shares (or distribute cash) on a future date in accordance with the provisions of a Performance Share Agreement.
(v) "Performance Share Agreement" shall mean the agreement between the Corporation and the recipient of Performance Shares that contains the terms, conditions and restrictions pertaining to such Performance Shares.
(w) "Plan" shall mean this Amended and Restated 2010 Stock Incentive Plan of Incyte Corporation, as amended from time to time.
(x) "Purchase Price" shall mean the consideration for which one Share may be acquired under the Plan (other than upon exercise of an Option), as specified by the Committee.
(y) "Qualifying Performance Criteria" shall have the meaning set forth in Section 19(b).
(z) "Restricted Share" shall mean a Share awarded under the Plan and subject to the terms, conditions and restrictions set forth in a Restricted Share Agreement.
(aa) "Restricted Share Agreement" shall mean the agreement between the Corporation and the recipient of a Restricted Share that contains the terms, conditions and restrictions pertaining to such Restricted Shares.
(bb) "Restricted Stock Unit" shall mean a bookkeeping entry representing the Corporation's obligation to deliver one Share (or distribute cash) on a future date in accordance with the provisions of a Restricted Stock Unit Agreement.
(cc) "Restricted Stock Unit Agreement" shall mean the agreement between the Corporation and the recipient of a Restricted Stock Unit that contains the terms, conditions and restrictions pertaining to such Restricted Stock Unit.
(dd) "SAR" shall mean a stock appreciation right granted under the Plan.
(ee) "SAR Agreement" shall mean the agreement between the Corporation and an Optionee that contains the terms, conditions and restrictions pertaining to his or her SAR.
(ff) "Service" shall mean service as an Employee, Consultant or Outside Director, subject to such further limitations as may be set forth in the Plan or the applicable Stock Option Agreement, SAR Agreement, Restricted Share Agreement, Restricted Stock Unit Agreement or Performance Share Agreement. Service does not terminate when an Employee goes on a bona fide leave of absence, that was approved by the Corporation in writing, if the terms of the leave provide for continued Service crediting, or when continued Service crediting is required by applicable law. However, for purposes of determining whether an Option is entitled to ISO status, an Employee's employment will be treated as terminating 90 days after such Employee went on leave, unless such Employee's right to return to active work is guaranteed by law or by a contract. Service terminates in any event when the approved leave ends, unless such Employee immediately returns to active work. The Corporation shall be entitled to determine in its sole discretion which leaves of absence count toward Service, and when Service terminates for all purposes under the Plan.
(gg) "Share" shall mean one share of Stock, as adjusted in accordance with Section 13 (if applicable).
(hh) "Stock" shall mean the common stock of the Corporation, $.001 par value per share.
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(ii) "Stock Option Agreement" shall mean the agreement between the Corporation and an Optionee that contains the terms, conditions and restrictions pertaining to such Option.
(jj) "Subsidiary" shall mean any corporation, if the Corporation or one or more other Subsidiaries own not less than 50% of the total combined voting power of all classes of outstanding stock of such corporation. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date.
(kk) "Total and Permanent Disability" shall mean that the Optionee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted, or can be expected to last for a continuous period of not less than one year.
SECTION 3.ADMINISTRATION.
(a) Committee Composition. The Plan shall be administered by the Board of Directors or a Committee appointed by the Board of Directors. The Committee shall consist of two or more members of the Board of Directors. In addition, to the extent required by the Board of Directors, the composition of the Committee shall satisfy (i) such requirements as the Securities and Exchange Commission may establish for administrators acting under plans intended to qualify for exemption under Rule 16b-3 (or its successor) under the Exchange Act; and (ii) such other applicable independence standards imposed by law, regulation or listing standard.
(b) Committee for Non-Officer Grants. The Board of Directors may also appoint one or more separate committees of the Board of Directors, each composed of one or more members of the Board of Directors who need not satisfy the requirements of Section 3(a), who may administer the Plan with respect to Employees who are not considered officers or directors of the Corporation under Section 16 of the Exchange Act, may grant Awards under the Plan to such Employees and may determine all terms of such grants. Within the limitations of the preceding sentence, any reference in the Plan to the Committee shall include such committee or committees appointed pursuant to the preceding sentence. To the extent permitted by applicable laws, the Board of Directors may also authorize one or more officers of the Corporation to designate Employees, other than persons subject to Section 16 of the Exchange Act, to receive Awards and to determine the number of such Awards to be received by such Employees.
(c) Committee Procedures. The Board of Directors shall designate one of the members of the Committee as chairman. The Committee may hold meetings at such times and places as it shall determine. The acts of a majority of the Committee members present at meetings at which a quorum exists, or acts reduced to or approved in writing (including via email) by all Committee members, shall be valid acts of the Committee.
(d) Committee Responsibilities. Subject to the provisions of the Plan, the Committee shall have full authority and discretion to take the following actions:
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Subject to the requirements of applicable law, the Committee may designate persons other than members of the Committee to carry out its responsibilities and may prescribe such conditions and limitations as it may deem appropriate, except that the Committee may not delegate its authority with regard to the selection for participation of or the granting of Awards under the Plan to persons subject to Section 16 of the Exchange Act. All decisions, interpretations and other actions of the Committee shall be final and binding on all Participants, and all persons deriving their rights from a Participant. No member of the Committee shall be liable for any action that he or she has taken or has failed to take in good faith with respect to the Plan or any Award.
SECTION 4.ELIGIBILITY.
(a) General Rule. Only Employees shall be eligible for the grant of ISOs. Only Employees, Consultants and Outside Directors shall be eligible for the grant of Restricted Shares, Restricted Stock Units, Performance Shares, Nonstatutory Options or SARs.
(b) Ten-Percent Stockholders. An Employee who owns more than 10% of the total combined voting power of all classes of outstanding stock of the Corporation, a Parent or Subsidiary shall not be eligible for the grant of an ISO unless such grant satisfies the requirements of Section 422(c)(5) of the Code.
(c) Attribution Rules. For purposes of Section 4(b) above, in determining stock ownership, an Employee shall be deemed to own the stock owned, directly or indirectly, by or for such Employee's brothers, sisters, spouse, ancestors and lineal descendants. Stock owned, directly or indirectly, by or for a corporation, partnership, estate or trust shall be deemed to be owned proportionately by or for its stockholders, partners or beneficiaries.
(d) Outstanding Stock. For purposes of Section 4(b) above, "outstanding stock" shall include all stock actually issued and outstanding immediately after the grant but shall not include shares authorized for issuance under outstanding options held by the Employee or by any other person.
SECTION 5.STOCK SUBJECT TO PLAN.
(a) Basic Limitation. Shares offered under the Plan shall be authorized but unissued Shares or treasury Shares. The aggregate number of Shares authorized for issuance as Awards under the Plan shall not exceed 53,953,475. The limitation of this Section 5(a) shall be subject to adjustment pursuant to Section 13. Any Shares issued in connection with Options and SARs shall be counted against this limitation as one Share for every one Share so issued. Any Shares issued in connection with Awards other than Options and SARs shall be counted against this limitation as 2.0 Shares for every one Share so issued. The number of Shares that are subject to Awards outstanding at any time under the Plan shall not exceed the number of Shares which then remain available for issuance under the Plan. The Corporation, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares tendered or withheld in full or partial payment of the Exercise Price of an Award or to satisfy tax withholding obligations in connection with an Award, and Shares issued under an Award that are purchased by the Corporation on the open market, shall not be available for future issuance under the Plan.
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(b) Award Limitation. Subject to the provisions of Section 13, no Participant may receive Awards under the Plan in any calendar year that relate to more than 800,000 Shares.
(c) Additional Shares. If an Award expires or becomes unexercisable without having been exercised in full, or, with respect to Restricted Shares, Restricted Stock Units or Performance Shares, is forfeited to or repurchased by the Corporation due to failure to vest, the unpurchased Shares (or for Awards other than Options or SARs the forfeited or repurchased Shares) which were subject thereto will become available for future grant or sale under the Plan (unless the Plan has terminated). With respect to SARs, when a stock settled SAR is exercised, all of the Shares subject to the SAR shall be counted against the number of Shares available for future grant or sale under the Plan, regardless of the number of Shares actually issued pursuant to such exercise. Shares that have actually been issued under the Plan under any Award will not be returned to the Plan and will not become available for future distribution under the Plan; provided, however, that if Shares issued pursuant to Awards of Restricted Shares, Restricted Stock Units or Performance Shares are repurchased by the Corporation or are forfeited to the Corporation, such Shares will become available for future grant under the Plan. To the extent an Award under the Plan is paid out in cash rather than Shares, such cash payment will not result in reducing the number of Shares available for issuance under the Plan.
SECTION 6.RESTRICTED SHARES.
(a) Restricted Share Agreement. Each grant of Restricted Shares under the Plan shall be evidenced by a Restricted Share Agreement between the recipient and the Corporation. Such Restricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Restricted Share Agreements entered into under the Plan need not be identical.
(b) Payment for Awards. Restricted Shares may be sold or awarded under the Plan for such consideration as the Committee may determine, including cash, cash equivalents, full-recourse promissory notes, past services and future services.
(c) Vesting. Each Award of Restricted Shares shall vest over a minimum period of three years of the Participant's Service, subject to Section 19(c). Vesting shall occur, in full or in installments, upon satisfaction of such Service requirement and such other conditions specified in the Restricted Share Agreement. A Restricted Share Agreement may provide for accelerated vesting in the event of the Participant's death, Total and Permanent Disability or retirement or other events. The Committee may determine, at the time of granting Restricted Shares or thereafter, that all or part of such Restricted Shares shall become vested upon a Change in Control. Except as may be set forth in a Restricted Share Agreement, vesting of the Restricted Shares shall cease on the termination of the Participant's Service.
(d) Voting and Dividend Rights. The holders of Restricted Shares awarded under the Plan shall have the same voting, dividend and other rights as the Corporation's other stockholders. A Restricted Share Agreement, however, may require that the holders of Restricted Shares invest any cash dividends received in additional Restricted Shares. Such additional Restricted Shares shall be subject to the same conditions and restrictions as the Award with respect to which the dividends were paid.
(e) Restrictions on Transfer of Shares. Restricted Shares shall be subject to such rights of repurchase, rights of first refusal or other restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Restricted Share Agreement and shall apply in addition to any general restrictions that may apply to all holders of Shares.
SECTION 7.TERMS AND CONDITIONS OF OPTIONS.
(a) Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the Optionee and the Corporation. Such Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions which are not inconsistent with the Plan and which the Committee deems appropriate for inclusion in a Stock Option Agreement. The Stock Option Agreement shall specify whether the Option is an ISO or an NSO. The provisions of the various Stock Option Agreements entered into under the Plan need not be identical. Options may be granted in consideration of a reduction in the Optionee's other compensation.
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(b) Number of Shares. Each Stock Option Agreement shall specify the number of Shares that are subject to the Option (subject to adjustment in accordance with Section 13).
(c) Exercise Price. Each Stock Option Agreement shall specify the Exercise Price. The Exercise Price of an ISO shall not be less than 100% of the Fair Market Value of a Share on the date of grant, except as otherwise provided in Section 4(b), and the Exercise Price of an NSO shall not be less 100% of the Fair Market Value of a Share on the date of grant. Subject to the foregoing in this Section 7(c), the Exercise Price under any Option shall be determined by the Committee at its sole discretion. The Exercise Price shall be payable in one of the forms described in Section 8.
(d) Withholding Taxes. As a condition to the exercise of an Option, the Optionee shall make such arrangements as the Corporation may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with such exercise. The Optionee shall also make such arrangements as the Corporation may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with the disposition of Shares acquired by exercising an Option.
(e) Exercisability and Term. Each Stock Option Agreement shall specify the date when all or any installment of the Option is to become exercisable, subject to Section 12(c) in the case of automatic Option grants to Outside Directors and to Section 19(c) for all other Option grants. The Stock Option Agreement shall also specify the term of the Option; provided, however, that the term of an ISO shall in no event exceed 10 years from the date of grant (five years for Employees described in Section 4(b)). A Stock Option Agreement may provide for accelerated exercisability in the event of the Optionee's death, Total and Permanent Disability or retirement or other events and may provide for expiration prior to the end of its term in the event of the termination of the Optionee's Service. Options may be awarded in combination with SARs, and such an Award may provide that the Options will not be exercisable unless the related SARs are forfeited. Subject to the foregoing in this Section 7(e), the Committee at its sole discretion shall determine when all or any installment of an Option is to become exercisable and when an Option is to expire.
(f) Exercise of Options. Each Stock Option Agreement shall set forth the extent to which the Optionee shall have the right to exercise the Option following termination of the Optionee's Service with the Corporation and its Subsidiaries, and the right to exercise the Option of any executors or administrators of the Optionee's estate or any person who has acquired such Option(s) directly from the Optionee by bequest or inheritance. Such provisions shall be determined in the sole discretion of the Committee, need not be uniform among all Options issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination of Service.
(g) Effect of Change in Control. The Committee may determine, at the time of granting an Option or thereafter, that such Option shall become exercisable as to all or part of the Shares subject to such Option upon a Change in Control.
(h) No Rights as a Stockholder. An Optionee, or a permitted transferee of an Optionee, shall have no rights as a stockholder of the Corporation with respect to any Shares covered by the Option until the date of the issuance of the Shares underlying the Option upon a valid exercise thereof.
(i) Modification, Extension and Assumption of Options. Within the limitations of the Plan, the Committee may modify, extend or assume outstanding Options or may accept the cancellation of outstanding Options (whether granted by the Corporation or another issuer) in return for the grant of new Options for the same or a different number of Shares and at the same or a different Exercise Price; provided, however, that the Committee may not modify outstanding Options to lower the Exercise Price nor may the Committee assume or accept the cancellation of outstanding Options in return for the grant of new Options or SARs with a lower Exercise Price, unless such action has been approved by the Corporation's stockholders. The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, materially impair such Optionee's rights or increase his or her obligations under such Option.
(j) Restrictions on Transfer of Shares. Any Shares issued upon exercise of an Option shall be subject to such special forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Stock Option Agreement and shall apply in addition to any general restrictions that may apply to all holders of Shares.
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(k) Buyout Provisions. Except with respect to an Option whose Exercise Price exceeds the Fair Market Value of the Shares subject to the Option, the Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents an Option previously granted or (b) authorize an Optionee to elect to cash out an Option previously granted, in either case at such time and based upon such terms and conditions as the Committee shall establish.
SECTION 8.PAYMENT FOR SHARES.
(a) General Rule. The entire Exercise Price or Purchase Price of Shares issued under the Plan shall be payable in lawful money of the United States of America at the time when such Shares are purchased, except as provided in Section 8(b) through Section 8(g) below.
(b) Surrender of Stock. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by surrendering, or attesting to the ownership of, Shares which have already been owned by the Optionee or his representative. Such Shares shall be valued at their Fair Market Value on the date when the new Shares are purchased under the Plan. The Optionee shall not surrender, or attest to the ownership of, Shares in payment of the Exercise Price if such action would cause the Corporation to recognize compensation expense (or additional compensation expense) with respect to the Option for financial reporting purposes.
(c) Services Rendered. At the discretion of the Committee, Shares may be awarded under the Plan in consideration of services rendered to the Corporation or a Subsidiary prior to the award. If Shares are awarded without the payment of a Purchase Price in cash, the Committee shall make a determination (at the time of the award) of the value of the services rendered by the Offeree and the sufficiency of the consideration to meet the requirements of Section 6(b).
(d) Cashless Exercise. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by delivery (on a form prescribed by the Committee) of an irrevocable direction to a securities broker to sell Shares and to deliver all or part of the sale proceeds to the Corporation in payment of the aggregate Exercise Price.
(e) Exercise/Pledge. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by delivery (on a form prescribed by the Committee) of an irrevocable direction to a securities broker or lender to pledge Shares, as security for a loan, and to deliver all or part of the loan proceeds to the Corporation in payment of the aggregate Exercise Price.
(f) Promissory Note. To the extent that a Stock Option Agreement or Restricted Share Agreement so provides, payment may be made all or in part by delivering (on a form prescribed by the Corporation) a full-recourse promissory note.
(g) Other Forms of Payment. To the extent that a Stock Option Agreement or Restricted Share Agreement so provides, payment may be made in any other form that is consistent with applicable laws, regulations and rules.
(h) Limitations under Applicable Law. Notwithstanding anything herein or in a Stock Option Agreement or Restricted Share Agreement to the contrary, payment may not be made in any form that is unlawful, as determined by the Committee in its sole discretion.
SECTION 9.STOCK APPRECIATION RIGHTS.
(a) SAR Agreement. Each grant of a SAR under the Plan shall be evidenced by a SAR Agreement between the Optionee and the Corporation. Such SAR shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various SAR Agreements entered into under the Plan need not be identical. SARs may be granted in consideration of a reduction in the Optionee's other compensation.
(b) Number of Shares. Each SAR Agreement shall specify the number of Shares to which the SAR pertains and shall provide for the adjustment of such number in accordance with Section 13.
(c) Exercise Price. Each SAR Agreement shall specify the Exercise Price, which shall not be less than 100% of the Fair Market Value of a Share on the date of grant. A SAR Agreement may specify an Exercise Price that varies in accordance with a predetermined formula while the SAR is outstanding.
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(d) Exercisability and Term. Each SAR Agreement shall specify the date when all or any installment of the SAR is to become exercisable, subject to Section 19(c). The SAR Agreement shall also specify the term of the SAR. A SAR Agreement may provide for accelerated exercisability in the event of the Optionee's death, Total and Permanent Disability or retirement or other events. Except as may be set forth in a SAR Agreement, vesting of the SAR shall cease on the termination of the Participant's Service. SARs may be awarded in combination with Options, and such an Award may provide that the SARs will not be exercisable unless the related Options are forfeited. A SAR may be included in an ISO only at the time of grant but may be included in an NSO at the time of grant or thereafter. A SAR granted under the Plan may provide that it will be exercisable only in the event of a Change in Control.
(e) Effect of Change in Control. The Committee may determine, at the time of granting a SAR or thereafter, that such SAR shall become fully exercisable as to all Shares subject to such SAR upon a Change in Control.
(f) Exercise of SARs. Upon exercise of a SAR, the Optionee (or any person having the right to exercise the SAR after his or her death) shall receive from the Corporation (a) Shares, (b) cash or (c) a combination of Shares and cash, as the Committee shall determine. The amount of cash and/or the Fair Market Value of Shares received upon exercise of SARs shall, in the aggregate, be equal to the amount by which the Fair Market Value (on the date of surrender) of the Shares subject to the SARs exceeds the Exercise Price.
(g) Modification or Assumption of SARs. Within the limitations of the Plan, the Committee may modify, extend or assume outstanding SARs or may accept the cancellation of outstanding SARs (whether granted by the Corporation or by another issuer) in return for the grant of new SARs for the same or a different number of Shares and at the same or a different exercise price; provided, however, that the Committee may not modify outstanding SARs to lower the Exercise Price nor may the Committee assume or accept the cancellation of outstanding SARs in return for the grant of new SARs or Options with a lower Exercise Price, unless such action has been approved by the Corporation's stockholders. The foregoing notwithstanding, no modification of a SAR shall, without the consent of the holder, materially impair his or her rights or obligations under such SAR.
(h) Buyout Provisions. Except with respect to a SAR whose Exercise Price exceeds the Fair Market Value of the Shares subject to the SAR, the Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents a SAR previously granted, or (b) authorize an Optionee to elect to cash out a SAR previously granted, in either case at such time and based upon such terms and conditions as the Committee shall establish.
SECTION 10.RESTRICTED STOCK UNITS.
(a) Restricted Stock Unit Agreement. Each grant of Restricted Stock Units under the Plan shall be evidenced by a Restricted Stock Unit Agreement between the recipient and the Corporation. Such Restricted Stock Units shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Restricted Stock Unit Agreements entered into under the Plan need not be identical. Restricted Stock Units may be granted in consideration of a reduction in the recipient's other compensation.
(b) Payment for Awards. To the extent that an Award is granted in the form of Restricted Stock Units, no cash consideration shall be required of the Award recipients.
(c) Vesting Conditions. Each Award of Restricted Stock Units shall vest over a minimum period of three years of the Participant's Service, subject to Section 19(c). Vesting shall occur, in full or in installments, upon satisfaction of such Service requirement and such other conditions specified in the Restricted Stock Unit Agreement. A Restricted Stock Unit Agreement may provide for accelerated vesting in the event of the Participant's death, Total and Permanent Disability or retirement or other events. The Committee may determine, at the time of granting Restricted Stock Units or thereafter, that all or part of such Restricted Stock Units shall become vested in the event that a Change in Control occurs with respect to the Corporation. Except as may be set forth in a Restricted Stock Unit Agreement, vesting of the Restricted Stock Units shall cease on the termination of the Participant's Service.
(d) Voting and Dividend Rights. The holders of Restricted Stock Units shall have no voting rights. Prior to settlement or forfeiture, any Restricted Stock Unit awarded under the Plan may, at the Committee's discretion,
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carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Share while the Restricted Stock Unit is outstanding. Dividend equivalents may be converted into additional Restricted Stock Units. Settlement of dividend equivalents may be made in the form of cash, in the form of Shares, or in a combination of both. Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions (including without limitation, any forfeiture conditions) as the Restricted Stock Units to which they attach.
(e) Form and Time of Settlement of Restricted Stock Units. Settlement of vested Restricted Stock Units may be made in the form of (a) cash, (b) Shares or (c) any combination of both, as determined by the Committee. The actual number of Restricted Stock Units eligible for settlement may be larger or smaller than the number included in the original Award, based on predetermined performance factors. Methods of converting Restricted Stock Units into cash may include (without limitation) a method based on the average Fair Market Value of Shares over a series of trading days. A Restricted Stock Unit Agreement may provide that vested Restricted Stock Units may be settled in a lump sum or in installments. A Restricted Stock Unit Agreement may provide that the distribution may occur or commence when all vesting conditions applicable to the Restricted Stock Units have been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until an Award of Restricted Stock Units is settled, the number of such Restricted Stock Units shall be subject to adjustment pursuant to Section 13.
(f) Death of Recipient. Any Restricted Stock Units that become payable after the recipient's death shall be distributed to the recipient's beneficiary or beneficiaries. Each recipient of Restricted Stock Units under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the Corporation. A beneficiary designation may be changed by filing the prescribed form with the Corporation at any time before the Award recipient's death. If no beneficiary was designated or if no designated beneficiary survives the Award recipient, then any Restricted Stock Units that become payable after the recipient's death shall be distributed to the recipient's estate.
(g) Creditors' Rights. A holder of Restricted Stock Units shall have no rights other than those of a general creditor of the Corporation. Restricted Stock Units represent an unfunded and unsecured obligation of the Corporation, subject to the terms and conditions of the applicable Restricted Stock Unit Agreement.
SECTION 11.PERFORMANCE SHARES.
(a) Performance Shares and Performance Share Agreement. Each grant of Performance Shares under the Plan shall be evidenced by a Performance Share Agreement between the recipient and the Corporation. Such Performance Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Performance Share Agreements entered into under the Plan need not be identical. Performance Shares may be granted in consideration of a reduction in the recipient's other compensation.
(b) Payment for Awards. To the extent that an Award is granted in the form of Performance Shares, no cash consideration shall be required of the Award recipients.
(c) Terms of Performance Share Awards. The Committee shall determine the terms of Performance Share Awards, which may include subjecting such Awards to the attainment of "Qualifying Performance Criteria" as described in Section 19(b) of the Plan. Each Performance Share Agreement shall set forth the number of Shares subject to such Performance Share Award, the Qualifying Performance Criteria and the performance period. Subject to Section 19(c), the Participant shall be required to perform Service for the entire performance period (or if less, one year) in order to be eligible to receive payment under the Performance Share Award. Except as otherwise provided in the Performance Share Agreement, the Performance Share Award shall terminate upon the termination of the Participant's Service. Prior to settlement, the Committee shall determine the extent to which Performance Shares have been earned. Performance periods may overlap and the holders may participate simultaneously with respect to Performance Shares Awards that are subject to different performance periods and different Qualifying Performance Criteria. The number of Shares may be fixed or may vary in accordance with such Qualifying Performance Criteria as may be determined by the Committee. A Performance Share Agreement may provide for accelerated vesting in the event of the Participant's death, Total and Permanent Disability or retirement or other events. The Committee may determine, at the time of granting
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Performance Share Awards or thereafter, that all or part of the Performance Shares shall become vested upon a Change in Control.
(d) Voting and Dividend Rights. The holders of Performance Shares shall have no voting rights with respect to such Performance Shares. Prior to settlement or forfeiture, any Performance Share awarded under the Plan may, at the Committee's discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Share while the Performance Share is outstanding. Dividend equivalents may be converted into additional Performance Shares. Settlement of dividend equivalents may be made in the form of cash, in the form of Shares, or in a combination of both. Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions (including without limitation, any forfeiture conditions) as the Performance Shares to which they attach.
(e) Form and Time of Settlement of Performance Shares. Settlement of Performance Shares may be made in the form of (a) cash, (b) Shares or (c) any combination of both, as determined by the Committee and set forth in the Performance Share Agreements. The actual number of Performance Shares eligible for settlement may be larger or smaller than the number included in the original Award, based on the Qualifying Performance Criteria. Methods of converting Performance Shares into cash may include (without limitation) a method based on the average Fair Market Value of Shares over a series of trading days. A Performance Share Agreement may provide that Performance Shares may be settled in a lump sum or in installments. A Performance Share Agreement may provide that the distribution may occur or commence when all vesting conditions applicable to the Performance Shares have been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until an Award of Performance Shares is settled, the number of such Performance Shares shall be subject to adjustment pursuant to Section 13.
(f) Death of Recipient. Any Performance Share Award that becomes payable after the recipient's death shall be distributed to the recipient's beneficiary or beneficiaries. Each recipient of a Performance Share Award under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the Corporation. A beneficiary designation may be changed by filing the prescribed form with the Corporation at any time before the Award recipient's death. If no beneficiary was designated or if no designated beneficiary survives the Award recipient, then any Performance Share Award that becomes payable after the recipient's death shall be distributed to the recipient's estate.
(g) Creditors' Rights. A holder of Performance Shares shall have no rights other than those of a general creditor of the Corporation. Performance Shares represent an unfunded and unsecured obligation of the Corporation, subject to the terms and conditions of the applicable Performance Share Agreement.
SECTION 12.AUTOMATIC GRANTS TO OUTSIDE DIRECTORS
(a) Annual Grants. On the first business day following the conclusion of each regular annual meeting of the Corporation's stockholders beginning with the 2021 annual meeting, each Outside Director who will continue serving as a member of the Board of Directors thereafter shall receive Awards having an aggregate grant date fair value of $500,000 or such lesser dollar amount as shall be designated by the Board of Directors (the "Applicable Dollar Amount"), of which 60% shall be Nonstatutory Options and 40% shall be Restricted Stock Units. The number of Shares subject to such Nonstatutory Options shall be determined by dividing 60% of the Applicable Dollar Amount by the Black-Scholes value of one such Option, based on the average closing sale price for the Stock on The Nasdaq Global Select Market (or such other United States stock exchange or over-the-counter market on which the Stock is then traded) over the 30 consecutive trading days concluding with the last trading day prior to the grant date, rounded down to the nearest whole Share. The number of Shares subject to such Restricted Stock Units shall be determined by dividing 40% of the Applicable Dollar Amount by such 30 trading day average price, rounded down to the nearest whole Share. Each Outside Director who is not initially elected at a regular annual meeting of the Corporation's stockholders in 2021 or a subsequent year shall receive Awards within 10 business days of his or her election having an aggregate grant date fair value of a pro rata portion of the Applicable Dollar Amount, such pro rata portion to be determined based on the number of full calendar months remaining from the date of election until the next regular annual meeting of the Corporation's stockholders divided by 12. Such Outside Director's Awards shall consist of 60% Nonstatutory Options and 40% Restricted Stock Units determined in a manner similar to that used for the
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annual Awards to Outside Directors following the conclusion of the regular annual meeting of the Corporation's stockholders, except that the values of the Awards to such Outside Director shall be determined as of the grant date of such Awards.
(b) Vesting Conditions. Except as set forth in the next succeeding sentence and in the last sentence of this Subsection (b), each Award granted under Subsection (a) of this Section 12 shall become vested and (in the case of Options) exercisable in full on the first anniversary of the date of grant; provided, however, that each such Award shall become vested and exercisable in full immediately prior to the next regular annual meeting of the Corporation's stockholders following such date of grant in the event such meeting occurs prior to such first anniversary date. Except as set forth in the last sentence of this Subsection (b), each Award granted under Subsection (a) to Outside Directors who were not initially elected at a regular annual meeting of the Corporation's stockholders shall become vested and exercisable in full immediately prior to the next regular annual meeting of the Corporation's stockholders following the date of grant. Notwithstanding the foregoing, each Award granted under Subsection (a) above that is outstanding shall become vested and exercisable in full in the event that a Change in Control occurs with respect to the Corporation.
(c) Award Agreement. All grants to Outside Directors under this Section 12 shall be evidenced by a Stock Option Agreement or Restricted Stock Unit Agreement, as applicable, between the Outside Director and the Corporation. Such Awards shall be subject to all applicable terms and conditions of the Plan and may be subject to other terms and conditions that are not inconsistent with the Plan and that the Board of Directors deems appropriate for inclusion in a Stock Option Agreement or Restricted Stock Unit Agreement, as applicable.
(d) Additional Grants. Notwithstanding the foregoing provisions of this Section 12, the Board of Directors may from time to time increase the amount of the annual grant of Awards under Section 12(a) to any Outside Director to the extent the Board of Directors determines necessary to induce an Outside Director to become or remain an Outside Director or to reflect an increase in the duties or responsibilities of the Outside Director, subject to all terms and conditions of the Plan otherwise applicable to grants of Awards. Each such Award may become vested and exercisable on the same schedule as set forth in Section 12(b) or on a different schedule, as the Board of Directors in each case shall determine.
SECTION 13.ADJUSTMENT OF SHARES; REORGANIZATIONS.
(a) Adjustments. In the event of a subdivision of the outstanding Stock, a declaration of a dividend payable in Shares, a declaration of a dividend payable in a form other than Shares in an amount that has a material effect on the Fair Market Value of Shares, a combination or consolidation of the outstanding Stock (by reclassification or otherwise) into a lesser number of Shares, a recapitalization, a spin-off or a similar occurrence, the Committee shall make appropriate and equitable adjustments in:
(b) Dissolution or Liquidation. To the extent not previously exercised or settled, all outstanding Awards shall terminate immediately prior to the dissolution or liquidation of the Corporation.
(c) Reorganizations. In the event the Corporation is party to a merger or other reorganization, subject to any vesting acceleration provisions in an Award agreement, outstanding Awards shall be treated in the manner provided in the agreement of merger or reorganization (including as the same may be amended). Such agreement shall not be required to treat all Awards or individual types of Awards similarly in the merger or reorganization; provided, however, that such agreement shall provide for one of the following with respect to all outstanding Awards (as applicable):
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(d) Reservation of Rights. Except as provided in Section 13, a Participant shall have no rights by reason of the occurrence of (or relating to) any merger or other reorganization, any transaction described in Section 13(a), or any transaction that results in an increase or decrease in the number of shares of stock of any class of the Corporation. Any issue by the Corporation of shares of stock of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, Awards. The grant of an Award pursuant to the Plan shall not affect in any way the right or power of the
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Corporation to effect any merger or other reorganization, any transaction described in Section 13(a), any dissolution or liquidation of the Corporation or any transaction that results in an increase or decrease in the number of shares of stock of any class of the Corporation.
SECTION 14.DEFERRAL OF AWARDS.
(a) Committee Powers. The Committee in its sole discretion may permit or require a Participant to:
(b) General Rules. A deferred compensation account established under this Section 14 may be credited with interest or other forms of investment return, as determined by the Committee. A Participant for whom such an account is established shall have no rights other than those of a general creditor of the Corporation. Such an account shall represent an unfunded and unsecured obligation of the Corporation and shall be subject to the terms and conditions of the applicable agreement between such Participant and the Corporation. If the deferral or conversion of Awards is permitted or required, the Committee in its sole discretion may establish rules, procedures and forms pertaining to such Awards, including (without limitation) the settlement of deferred compensation accounts established under this Section 14.
(c) Code Section 409A. Notwithstanding the foregoing, any deferrals of Award payments in respect of an Award held by a Participant who is subject to United States federal income tax shall be subject to the applicable requirements of Section 409A of the Code and the Treasury Regulations promulgated thereunder. To the extent that the Committee determines that any Award granted under the Plan is subject to Section 409A of the Code, the Award agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code. In the event that following the grant of an Award the Committee determines that such Award may be subject to Section 409A of the Code, the Committee may adopt such amendments to the applicable Award agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Committee determines are necessary or appropriate to (a) exempt the Award from Section 409A of the Code and/or preserve the intended tax treatment of the benefits provided with respect to the Award, or (b) comply with the requirements of Section 409A of the Code and the Treasury Regulations promulgated thereunder and thereby avoid the application of any penalty taxes under such Section.
SECTION 15.PAYMENT OF DIRECTOR'S FEES IN SECURITIES
(a) Effective Date. No provision of this Section 15 shall be effective unless and until the Board has determined to implement such provision.
(b) Elections to Receive NSOs, Restricted Shares or Restricted Stock Units. An Outside Director may elect to receive his or her annual retainer payment and/or meeting fees from the Corporation in the form of cash, NSOs, Restricted Shares or Restricted Stock Units, or a combination thereof, as determined by the Board. Such NSOs, Restricted Shares or Restricted Stock Units shall be issued under the Plan. An election under this Section 15 shall be filed with the Corporation on the prescribed form. For the avoidance of doubt, any Awards issued to an Outside Director pursuant to this Section 15 shall not be counted towards the limit on annual Awards to the Outside Director prescribed by Section 12(a).
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(c) Number and Terms of NSOs, Restricted Shares or Restricted Stock Units. The number of NSOs, Restricted Shares or Restricted Stock Units to be granted to Outside Directors in lieu of annual retainers and meeting fees that would otherwise be paid in cash shall be calculated in a manner determined by the Board. The term of such NSOs, Restricted Shares or Restricted Stock Units shall also be determined by the Board.
SECTION 16.AWARDS UNDER OTHER PLANS.
The Corporation may grant awards under other plans or programs. Such awards may be settled in the form of Shares issued under this Plan. Such Shares shall be treated for all purposes under the Plan like Shares issued in settlement of Restricted Stock Units and shall, when issued, reduce the number of Shares available under Section 5.
SECTION 17.LEGAL AND REGULATORY REQUIREMENTS.
Shares shall not be issued under the Plan unless the issuance and delivery of such Shares complies with (or is exempt from) all applicable requirements of law, including (without limitation) the Securities Act of 1933, as amended, the rules and regulations promulgated thereunder, state securities laws and regulations and the regulations of any stock exchange on which the Corporation's securities may then be listed, and the Corporation has obtained the approval or favorable ruling from any governmental agency which the Corporation determines is necessary or advisable. The Corporation shall not be liable to a Participant or other persons as to: (a) the non-issuance or sale of Shares as to which the Corporation has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Corporation's counsel to be necessary to the lawful issuance and sale of any Shares under the Plan; and (b) any tax consequences expected, but not realized, by any Participant or other person due to the receipt, exercise or settlement of any Award granted under the Plan.
SECTION 18.WITHHOLDING TAXES.
(a) General. To the extent required by applicable federal, state, local or foreign law, a Participant or his or her successor shall make arrangements satisfactory to the Corporation for the satisfaction of any withholding tax obligations that arise in connection with the Plan. The Corporation shall not be required to issue any Shares or make any cash payment under the Plan until such obligations are satisfied.
(b) Share Withholding. The Corporation may permit a Participant to satisfy all or part of his or her withholding or income tax obligations by having the Corporation withhold all or a portion of any Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Shares that he or she previously acquired. Such Shares shall be valued at their Fair Market Value on the date when taxes otherwise would be withheld in cash. In no event may a Participant have Shares withheld that would otherwise be issued to him or her in excess of the number necessary to satisfy the legally required minimum tax withholding.
SECTION 19.OTHER PROVISIONS APPLICABLE TO AWARDS.
(a) Transferability. Unless the agreement evidencing an Award (or an amendment thereto authorized by the Committee) expressly provides otherwise, no Award granted under this Plan, nor any interest in such Award, may be assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred in any manner (prior to the vesting and lapse of any and all restrictions applicable to Shares issued under such Award), other than by will, by designation of a beneficiary (which shall be a family member or family trust) delivered to the Company, or by the laws of descent and distribution; provided, however, that an ISO may be transferred or assigned only to the extent consistent with Section 422 of the Code. Notwithstanding the foregoing, in no event may a Participant sell or otherwise transfer for value any Award granted under the Plan or any interest in such an Award, other than Shares issued to the Participant that are no longer subject to vesting or other restrictions under the terms of the applicable Award. Any purported sale, assignment, conveyance, gift, pledge, hypothecation or transfer in violation of this Section 19(a) shall be void and unenforceable against the Corporation.
(b) Qualifying Performance Criteria. The number of Shares or other benefits granted, issued, retainable and/or vested under an Award may be made subject to the attainment of performance goals for a specified period of time relating to one or more of the following performance criteria, either individually, alternatively or in any combination, applied to either the Corporation as a whole or to a business unit or Subsidiary, either individually, alternatively or in any combination, and measured either annually or cumulatively over a period of years, on an absolute basis or relative to a pre-established target, to previous years' or quarter's results or to
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the performance of one or more comparable companies or a designated comparison group or index, in each case as specified by the Committee in the Award: (a) cash flow (including operating cash flow), (b) earnings per share, (c) (i) earnings before interest, (ii) earnings before interest and taxes, (iii) earnings before interest, taxes and depreciation, (iv) earnings before interest, taxes, depreciation and amortization, or (iv) earnings before any combination of such expenses or deductions, (d) return on equity, (e) total stockholder return, (f) share price performance, (g) return on capital, (h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating income or net operating income, (l) operating profit or net operating profit, (m) operating margin or profit margin (including as a percentage of revenue), (n) return on operating revenue, (o) return on invested capital, (p) market segment shares, (q) economic profit, (r) achievement of target levels of discovery and/or development of products, including but not limited to regulatory achievements, (s) achievement of research and development objectives, or (t) formation of joint ventures, strategic relationships or other commercial, research or development collaborations ("Qualifying Performance Criteria"). The Committee may appropriately adjust any evaluation of performance under a Qualifying Performance Criteria to exclude any of the following events that occur during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) any extraordinary, nonrecurring items to be disclosed in the Corporation's financial statements (including footnotes) for the applicable year and/or in management's discussion and analysis of the financial condition and results of operations appearing in the Corporation's annual report to stockholders for the applicable year. If applicable, the Committee shall determine the Qualifying Performance Criteria and any permitted exclusions pursuant to the preceding sentence not later than the 90th day of the performance period, and shall determine and certify, for each Participant (or for all Participants), the extent to which the Qualifying Performance Criteria have been met. The Committee may not in any event increase the amount of compensation payable under the Plan upon the attainment of a Qualifying Performance Criteria to a Participant who is a "covered employee" within the meaning of Section 162(m) of the Code.
(c) Vesting Restrictions on Awards. Except with respect to a maximum of five percent (5%) of the total number of Shares authorized under the Plan or, in the case of automatic grants to Outside Directors, as otherwise permitted under Section 12(b), no Award may vest sooner than twelve (12) months from the date of grant.
SECTION 20.NO EMPLOYMENT RIGHTS.
No provision of the Plan, nor any Award granted under the Plan, shall be construed to give any person any right to become, to be treated as, or to remain an Employee. The Corporation and its Subsidiaries reserve the right to terminate any person's Service at any time and for any reason, with or without notice.
SECTION 21.APPLICABLE LAW.
The Plan shall be construed and enforced in accordance with the law of the State of Delaware, without reference to its principles of conflicts of law.
SECTION 22.DURATION AND AMENDMENTS.
(a) Term of the Plan. The Plan, as set forth herein, shall terminate automatically on June 30, 2026 and may be terminated on any earlier date pursuant to Subsection (b) below.
(b) Right to Amend or Terminate the Plan. The Board of Directors may amend or terminate the Plan at any time and from time to time. Rights and obligations under any Award granted before amendment of the Plan shall not be materially impaired by such amendment, except with consent of the Participant. An amendment of the Plan shall be subject to the approval of the Corporation's stockholders only to the extent required by applicable laws, regulations or rules.
(c) Effect of Termination. No Awards shall be granted under the Plan after the termination thereof. The termination of the Plan shall not affect Awards previously granted under the Plan.
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Your vote matters – here’s how to vote!You may vote online or by phone instead of mailing this card. VotescardVotes submitted electronically must be received by 11:59pm, (EDT), on May 25, 2021 Online GoJune 14, 2022Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas.OnlineGo to www.envisionreports.com/INCY or scan the QR code — login details are located in the shaded bar below. Phone Callbelow.PhoneCall toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada SaveCanadaSave paper, time and money! Sign up for electronic delivery at Using a black ink pen, mark your votes with an X as shown in this example. www.envisionreports.com/INCY Please do not write outside the designated areas. 1. Election of Directors:q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q + 1. Election of Directors: ForqFor Against Abstain For Against Abstain For Against Abstain 01 - Julian C. Baker 0204 - Paul J. Clancy07 - Katherine A. High02 - Jean-Jacques Bienaimé 03 - Paul J. Clancy 04 - Wendy L. Dixon 05 - Jacqualyn A. Fouse 06Fouse08 - Hervé Hoppenot03 - Otis W. Brawley06 - Edmund P. Harrigan 07 - Katherine A. High 08 - Hervé Hoppenot For Against Abstain For Against Abstain 2.Harrigan2. Approve, on a non-binding, advisory basis, the compensation of the Company's named executive officers. 3. Approve amendments to the Company’s Amended and Restated 2010 Stock Incentive Plan. 4.officers.For Against Abstain For Against Abstain3. Ratify the appointment of Ernst & Young LLP as the Company’s independentCompany’sindependent registered public accounting firm for 2021. 5. In their discretion, upon such other business as may properly come before the meeting or any adjournment thereof.2022. Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please givegiv full title. Datetitle.Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. + 8 303M53B8 2 B M 03ET2B B Authorized Signatures — This section must be completed for your vote to count. Please date and sign below. A Proposals — The Board of Directors recommends a vote FOR all the nominees listed and FOR Proposals 2-4. 2021 Annual Meeting Proxy Card