UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
WASHINGTON, D.C. 20549
SCHEDULE 14A
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Soliciting Material Under Rule 14a-12Pursuant to Section 240.14a-11(c) or Section 240.14a-12
SUMMIT THERAPEUTICS INC.
(Name of Registrant as Specified in its Charter)
(Name of Registrant as Specified in Its Charter) |
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SUMMIT THERAPEUTICS INC.
One Broadway, 14th Floor,2882 Sand Hill Road, Suite 106
Cambridge, Massachusetts 02142Menlo Park, California 94025
NOTICE OF ANNUALSPECIAL MEETING OF STOCKHOLDERS
To Be Held at 1:TO BE HELD AT ___:00 p.m. Eastern Time on June 15, 2022A.M./P.M. EASTERN TIME ON ____________ [ ] , 202_
Dear Summit Therapeutics Inc. Stockholder:Stockholders:
You are cordially invited to attend our 2022 annualNotice is hereby given that Summit Therapeutics Inc. (the “Company,” “Summit,” “we,” “us” or “our”) will hold a special meeting of stockholders (the “Annual“Special Meeting”), which will be held on June 15, 2022______ [ ], 202_ at 1:___:00 p.m.A.M./P.M. Eastern Time. The AnnualSpecial Meeting will be conducted virtually via live webcast. You will be able to vote and submit your questions during the meeting by visiting www.virtualshareholdermeeting.com/SMMT2022.SMMT2023SM. Please have your notice or proxy card in hand when you visit the website. During the AnnualSpecial Meeting, stockholders will be asked to vote on the following proposals, as more fully described in the accompanying proxy statement:
1. To elect six directors from the nominees named in the accompanying proxy statement to hold office until our 2023 annual meeting of stockholders and until their successors are duly elected and qualified, subject to earlier resignation or removal;
2. To ratify the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2022;
3. To approve, by a non-binding advisory vote, the compensation of our named executive officers; and
4. To transact such other business as may properly come before the Annual | | |
1. To approve an amendment to the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock by 650,000,000 (from 350,000,000 to 1,000,000,000), with the final decision of whether to proceed with the amendment to be determined by our board of directors, in its discretion, following stockholder approval (if obtained), but no later than ____, 202_.
2. To approve an amendment to our Restated Certificate of Incorporation to effect a reverse stock split of all of the outstanding shares of our Common Stock at a ratio in the range of 1-for-5 to 1-for-10, with the final decision of whether to proceed with the reverse stock split and the exact ratio and timing of the reverse split to be determined by our board of directors , in its discretion, following stockholder approval (if obtained), but no later than ____, 202_.
3. To transact any other business as may properly come before the Special Meeting or any adjournments or postponements thereof. |
Our Board of Directors has fixed the close of business on April 26,December 5, 2022 as the record date for the Annual Meeting.Special Meeting (the “Record Date”). Only stockholders of record on April 26,December 5, 2022 are entitled to notice of and to vote at the AnnualSpecial Meeting. It is important that your shares are represented and voted at the AnnualSpecial Meeting. For specific voting instructions, please refer to the information provided in the proxy statement, together with your proxy card or the voting instructions you received with the proxy statement.
Your vote must be received by 11:59 p.m. Eastern Time, on Tuesday, June 14, 2022.______, 202_. For specific voting instructions, please refer to the information provided in the proxy statement, together with your proxy card or the voting instructions you received with the proxy statement. This proxy statement is being mailed to stockholders on or about April 29,December [__], 2022.
YOUR VOTE IS IMPORTANT. Whether or not you plan to attend the virtual AnnualSpecial Meeting, we request that you submit your vote via the Internet, telephone or mail.
Thank you for your continued support of Summit Therapeutics Inc.
By Order of the Board of Directors,
/s/ Robert W. Duggan
Robert W. Duggan
Chief Executive Officer and Executive Chairman
Cambridge, MassachusettsMenlo Park, California
April 29,December [ ], 2022
TABLEPROXY STATEMENT
FOR SPECIAL MEETING OF CONTENTSSTOCKHOLDERS
Page
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| 1 |
| 1 |
CORPORATE GOVERNANCE | 9 |
Overview | 9 |
Board Leadership Structure | 9 |
The Board of Director’s Role in Risk Oversight | 9 |
Director Independence | 10 |
Director Nominations | 11 |
Code of Business Conduct and Ethics | 11 |
Policy on Short Sales, Derivative Transactions and Hedging Transactions | 12 |
Communication with the Board of Directors | 12 |
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD | 13 |
Board and Committee Meetings | 13 |
Board Committees | 15 |
Director Compensation | 18 |
PROPOSAL 1: ELECTION OF DIRECTORS | 20 |
PROPOSAL 2: RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 21 |
AUDITOR SERVICES AND FEES | 22 |
PROPOSAL 3: ADVISORY VOTE TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS | 23 |
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | 24 |
Policies and Procedures for Related Party Transactions | 24 |
Related Party Transactions | 25 |
| 28 |
EXECUTIVE OFFICERS | 30 |
Executive Officers | 30 |
EXECUTIVE COMPENSATION | 31 |
Compensation Committee Report | 31 |
Executive Compensation | 31 |
Outstanding Equity Awards at Fiscal Year-End | 34 |
Narrative to Summary Compensation Table and Outstanding Equity Awards at Fiscal Year End | 35 |
Equity Compensation Plan Information | 36 |
AUDIT COMMITTEE REPORT | 37 |
DELINQUENT SECTION 16(a) REPORTS | 38 |
OTHER INFORMATION | 38 |
Stockholder Proposals | 38 |
Stockholders Sharing the Same Address | 39 |
Fiscal Year 2021 Annual Report and SEC Filings | 39 |
SUMMIT THERAPEUTICS INC.
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PROXY STATEMENT
FOR THE ANNUALSPECIAL MEETING OF STOCKHOLDERS
To Be Held at 1:___:00 a.m/p.m. Eastern Time on June 15, 2022[____ ], 202_
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GENERAL INFORMATION
We are providing you with this Proxy Statement and the enclosed form of proxy in connection with the solicitation by our Board of Directors for use at our 2022 annualspecial meeting of stockholders (the “Annual“Special Meeting”). Due to the continuing coronavirus (COVID-19) outbreak, the AnnualThe Special Meeting will be conducted virtually via live audio webcast by visitingwww.virtualshareholdermeeting.com/SMMT2022SMMT2023SM on June 15, 2022_______[ ], 202_ at 1:___:00 a.m/p.m. Eastern Time. This Proxy Statement contains important information regarding our AnnualSpecial Meeting, the proposals on which you are being asked to vote, information you may find useful in determining how to vote, and information about voting procedures. As used herein, “we,” “us,” “our,” “Summit,” or the “Company” refers to Summit Therapeutics Inc., a Delaware corporation.
This Proxy Statement and the accompanying proxy card or voting instruction form will first be made available to our stockholders on or about April 29,December [ ], 2022. See the section titled, “Fiscal Year 2021 Annual Report and SEC Filings” for information on accessing our 2021 Annual Report to Stockholders.
The information provided in the “question and answer” format below is for your convenience only and is merely a summary of the information contained in this Proxy Statement. You should read this entire Proxy Statement carefully. Information contained on or that can be accessed through our website is not intended to be incorporated by reference into this Proxy Statement and references to our website address in this Proxy Statement are inactive textual references only.
QUESTIONS AND ANSWERS
What is a proxy?
A proxy is your legal designation of another person to vote the stock you own. The person you designate is your “proxy,” and you give the proxy authority to vote your shares by submitting the enclosed proxy card, or if available, voting by telephone or the Internet. We have designated Robert W. Duggan, and MahkamMakham Zanganeh or Ankur Dhingra to serve as proxies for the AnnualSpecial Meeting.
What matters will be voted on at the AnnualSpecial Meeting?
The following matters will be voted on at the AnnualSpecial Meeting:
•Proposal 1: To elect sixapprove an amendment to authorize the Board, in its discretion but prior to the one-year anniversary of the date on which the increase in the number of authorized shares is approved by the Company’s stockholders at the Annual Meeting, to amend the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock by 650,000,000 (from 350,000,000 to 1,000,000,000), with the final decision of whether to proceed with the amendment to be determined by our board of directors, from the nominees named in this Proxy Statement to hold office until our 2022 annual meeting of stockholders and until their respective successors are duly elected and qualified, subject to earlier resignation or removal;its discretion, following stockholder approval (if obtained), but no later than ____, 202_ (the “Capitalization Increase”);
•Proposal 2: To ratifyapprove an amendment to authorize the appointmentBoard, in its discretion but prior to the one-year anniversary of PricewaterhouseCoopers LLP asthe date on which the reverse stock split is approved by the Company’s stockholders at the Annual Meeting, to amend our independent registered public accounting firm forRestated Certificate of Incorporation to effect a reverse stock split of all of the fiscal year ending December 31, 2022; and
Proposal 3: To approve, by a non-binding advisory vote, the compensationoutstanding shares of our named executive officers;
Common Stock, at a ratio in the range of 1-for-5 to 1-for-10, with the final decision of whether to proceed with the reverse stock split and the exact ratio and timing of the reverse split to be determined by our board of directors, in its discretion, following stockholder approval (if obtained), but no later than ____, 202_ (the “Reverse Stock Split”); and
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Such other business as may properly come before the AnnualSpecial Meeting or any adjournment or postponement of the AnnualSpecial Meeting.
How does the Board of Directors recommend that I vote?
The Board of Directors recommends that you vote:
•“FOR” the electionapproval of the six directors nominated by our Board of Directors and named in this proxy statement;
•“FOR” the ratificationauthorization of the appointmentBoard to amend the Company’s Restated Certificate of PricewaterhouseCoopers LLPIncorporation to increase the number of authorized shares of common stock by 650,000,000 (from 350,000,000 to 1,000,000,000), as our independent registered public accounting firm for the fiscal year ending December 31, 2022; anddescribed in Proposal 1.
•“FOR” the approval of the compensationauthorization of our named executive officersthe Board to amend the Company’s Restated Certificate of Incorporation for the Reverse Stock Split, as described in Proposal 2.
Will the Board be able to adopt both proposals assuming they are both approved by stockholders?
The Board has submitted for stockholder approval both the Capitalization Increase, as described in Proposal 1, and the Reverse Stock Split, as described in Proposal 2. The Board has submitted both proposals to stockholders to provide the Board with maximum flexibility to determine which proposal it believes would be in the best interests of stockholders. In the event of stockholder approval of both proposals, the Board will have discretion as to whether to adopt neither, one or both proposals at any time prior to the one year anniversary of the stockholder approval date.
Will there be any other items of business on the agenda?
If any other items of business or other matters are properly brought before the AnnualSpecial Meeting, your proxy gives discretionary authority to the persons named on the proxy card with respect to those items of business or other matters. The persons named on the proxy card intend to vote the proxy in accordance with their best judgment. Our Board of Directors does not intend to bring any other matters to be voted on at the AnnualSpecial Meeting. We are not currently aware of any other matters that may properly be presented by others for action at the AnnualSpecial Meeting.
Who is entitled to vote at the AnnualSpecial Meeting?
Holders of our common stock at the close of business on April 26,December 5, 2022, which we refer to as the record date, may vote at the AnnualSpecial Meeting. Each stockholder is entitled to one vote for each share of our common stock held as of the record date. In deciding all matters at the AnnualSpecial Meeting, each stockholder will be entitled to one vote for each share of our common stock held by them on the record date. Stockholders are not permitted to cumulate votes with respect to the election of directors.
A complete list of these stockholders entitled to vote at the Special Meeting will be available for inspection at www.virtualshareholdermeeting.com/SMMT2022our principal executive offices for at least ten days prior to the AnnualSpecial Meeting and at the Special Meeting. A stockholder may examine the list for any legally valid purpose related to the AnnualSpecial Meeting.
What is the difference between holding shares as a stockholder of record and as a beneficial owner?
Stockholders of Record. You are a stockholder of record if at the close of business on the record date your shares were registered directly in your name with Computershare Trust Company, N.A., our transfer agent. As the stockholder of record, you have the right to grant your voting proxy directly to the individuals listed on the proxy card or to vote on your own behalf at the AnnualSpecial Meeting.
Beneficial Owner. You are a beneficial owner if, at the close of business on the record date, your shares were held by a brokerage firm, bank or other nominee and not in your name. Being a beneficial owner means that, like many of our stockholders, your shares are held in “street name.” As the beneficial owner, you have the right to direct your broker, bank or nominee how to vote your shares by following the voting instructions your broker, bank or other nominee
provides. However, since a beneficial owner is not the stockholder of record, you may not vote your shares of our common stock at the AnnualSpecial Meeting unless you follow your broker’s procedures for obtaining a legal proxy. Please see “What if I do not specify how my shares are to be voted?” for more information.
Do I have to do anything in advance if I plan to attend the AnnualSpecial Meeting?
The AnnualSpecial Meeting will be a virtual audio meeting of stockholders, which will be conducted via live audio webcast. You are entitled to participate in the annual meetingSpecial Meeting only if you were a holder of our common stock as of the close of business on April 26,December 5, 2022 or if you hold a valid proxy for the AnnualSpecial Meeting.
To participate in the AnnualSpecial Meeting, you will need the control number included on your notice or proxy card. The live audio webcast will begin promptly at 1:00 ___:__ a.m/p.m. Eastern Time. We encourage you to access the meeting prior to the start time. Online check-in will begin at 12:45 __:__ a.m/p.m. Eastern Time and you should allow ample time for the check-in procedures.
How do I ask questions during the AnnualSpecial Meeting?
We are committed to ensuring our stockholders have the same rights and opportunities to participate in the AnnualSpecial Meeting as if it had been held in a physical location. If you wish to submit a question during the meeting, you may log into www.virtualshareholdermeeting.com/SMMT2022SMMT2023SM and enter your 16-digit control number. Once past the login screen, click on “Question for Management,” type in your question, and click “Submit.”
Questions pertinent to meeting matters will be answered during the meeting, subject to time constraints. Questions regarding personal matters are not pertinent to meeting matters and therefore will not be answered.
How can I get help if I have trouble checking in or listening to the meeting online?
If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the log-in page at www.virtualshareholdermeeting.com/SMMT2022.SMMT2023SM.
How do I vote and what are the voting deadlines?
Stockholders of Record. If you are a stockholder of record, there are several ways for you to vote your shares:
•By mail.mail. If you received printed proxy materials, you may submit your vote by completing, signing and dating each proxy card received and returning it in the prepaid envelope. Sign your name exactly as it appears on the proxy card. Your completed, signed and dated proxy card must be received prior to the AnnualSpecial Meeting.
•By telephone or via the Internet.Internet. You may vote your shares by telephone or via the Internet by following the instructions provided in the proxy card. We recommend that you have your proxy card in hand when voting by telephone or via the Internet. If you vote by telephone or via the Internet, you do not need to return a proxy card by mail. Internet and telephone voting are available 24 hours a day. Votes submitted by telephone or via the Internet must be received by 11:59 p.m. Eastern Time on June 14, 2022.______, 202_.
•Attend the Annual Meeting.Special Meeting. You may vote at the AnnualSpecial Meeting by following the instructions at www.virtualshareholdermeeting.com/SMMT2022.SMMT2023SM. Please have your notice or proxy card in hand when you visit the website.
Beneficial Owners. If you are a beneficial owner of your shares, you will receive voting instructions from the broker, bank or other nominee holding your shares. You should follow the voting instructions provided by your broker, bank or nominee in order to instruct your broker, bank or other nominee on how to vote your shares. The availability of telephone and Internet voting will depend on the voting process of the broker, bank or nominee. Shares held beneficially may be voted at the AnnualSpecial Meeting only if you obtain a legal proxy from the broker, bank or nominee giving you the right to vote the shares.
Whether or not you plan to attend the AnnualSpecial Meeting, we request that you vote by proxy to ensure your vote is counted. To vote, you will need the control number. The control number will be included in the notice or on your proxy card if you are a stockholder of record, or included with your voting instructions received from your broker, bank or other nominee if you hold your shares of common stock in a “street name”.
Internet proxy voting is provided to allow you to vote your shares online, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions. Please be aware that you must bear any costs associated with your Internet access.
Can I revoke or change my vote after I submit my proxy?
Stockholders of Record. If you are a stockholder of record, you may revoke your proxy at any time before it is voted at the AnnualSpecial Meeting by:
•signing and returning a new proxy card with a later date;
•entering a new vote by telephone or via the Internet by 11:59 p.m. Eastern Time on June 14, 2022;______, 202_;
•delivering a written revocation to Robert W. Duggan, our Principal Executive Officer and PrincipalChief Financial Officer at Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 021422882 Sand Hill Road, Suite 106, Menlo Park, California 94025 by 5:___:00 a.m/p.m. Eastern Time on June 14, 2022;______, 202_; or
•following the instructions at www.virtualshareholdermeeting.com/SMMT2022.SMMT2023SM.
Beneficial Owners. If you are a beneficial owner of your shares, you must contact the broker, bank or other nominee holding your shares and follow their instructions on changing your vote.
What if I do not specify how my shares are to be voted?
Stockholders of Record. If you are a stockholder of record and you submit a proxy, but you do not provide voting instructions, your shares will be voted:
•“FOR” the electionapproval of the six directors nominatedamendment to the Company’s Restated Certificate of Incorporation to increase the number of authorized shares of common stock by our Board of Directors and named in this Proxy Statement for a one-year term and until their successors are duly elected;
•“FOR” the ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2022;650,000,000 (from 350,000,000 to 1,000,000,000);
•“FOR” the approval by a non-binding advisory vote, of the compensationamendment to the Company’s Restated Certificate of our named executive officers; andIncorporation to effect the Reverse Stock Split;
•In the discretion of the named proxies regarding any other matters properly presented for vote at the AnnualSpecial Meeting.
Beneficial Owners. If you are a beneficial owner and you do not provide your broker, bank or other nominee with voting instructions, your broker, bank or other nominee will determine if it has the discretionary authority to vote on the particular matter. Under the rules of The Nasdaq StockCapital Market, brokers, banks and other nominees do not have discretion to vote on non-routine matters such as Proposal 1 absent direction from you. Therefore, if you do not provide voting instructions to your broker, bank or other nominee, your broker, bank or other nominee may not vote your shares on Proposals 1, 3 or 4.
What constitutes a quorum, and why is a quorum required?
A quorum is the minimum number of shares required to be present at the AnnualSpecial Meeting for the AnnualSpecial Meeting to be properly held under our Bylawsbylaws and Delaware law. The presence (including by proxy) of a majority of all issued and outstanding shares of our common stock entitled to vote at the AnnualSpecial Meeting will constitute a quorum at the AnnualSpecial Meeting. As of the close of business on the record date of April 26,December 5, 2022, we had 98,122,356______ shares of common stock outstanding and entitled to vote at the AnnualSpecial Meeting, meaning that 49,061,179______ shares of common stock must be represented at the AnnualSpecial Meeting to constitute a quorum.
Your shares will be counted towards the quorum if you submit a proxy or vote at the AnnualSpecial Meeting. Abstentions and broker non-votes will also count towards the quorum requirement. If there is not a quorum, a majority of the shares present at the AnnualSpecial Meeting may adjourn the meeting to a later date.
What is the effect of a broker non-vote?
Brokers, banks or other nominees who hold shares of our common stock for a beneficial owner have the discretion to vote on routine proposals when they have not received voting instructions from the beneficial owner at least ten days prior to the AnnualSpecial Meeting. A broker non-vote occurs when a broker, bank or other nominee does not receive voting instructions from the beneficial owner and does not have the discretion to direct the voting of the shares. Broker non-votes will be counted for purposes of calculating whether a quorum is present at the AnnualSpecial Meeting but will not be counted for purposes of determining the number of votes present and entitled to vote with respect to a particular proposal. Thus, aA broker non-vote will not affect the outcome of theor other nominee cannot vote without instructions on a proposal that requires a plurality of votes cast.non-routine matters.
What is the vote required for each proposal?
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| Proposal | Vote Required | Broker
Discretionary
Voting Allowed |
Proposal 1: Election of directors | Plurality of votes cast | No |
Proposal 2: RatificationApproval of the appointmentamendment to the Company’s Restated Certificate of PricewaterhouseCoopers LLP as our independent registered public accounting firm forIncorporation to increase the fiscal year ending December 31, 2022number of authorized shares of common stock. | MajorityThe affirmative vote of the shares (i)holders of a majority of outstanding stock entitled to vote, (ii) present (including by proxy) and (iii) voting affirmatively or negatively on the Proposalvote. | Yes |
Proposal 3: Non-binding advisory vote to approve the compensation of named executive officers | Majority2: Approval of the shares (i)amendment to the Company’s Restated Certificate of Incorporation to effect the Reverse Stock Split. | The affirmative vote of the holders of a majority of outstanding stock entitled to vote, (ii) present (including by proxy) and (iii) voting affirmatively or negatively on the Proposalvote. | NoYes |
What is the vote required for each proposal?
With respect to Proposal 1, you may vote FOR, AGAINST or AGAINST any of the nominees for election as a director, orABSTAIN. If you may ABSTAIN from voting on any nominee. The election of directors requiresthis proposal, your abstention will act as a plurality vote against approval of the shares of our common stock present (includingCharter Amendment. Shares represented by proxy) atexecuted, but unmarked, proxies will be voted “FOR” the Annual Meeting and entitled to vote thereon to be approved. “Plurality” means that the nominees who receive the largest number of FOR votes are elected as directors. As a result, any shares not voted FOR a particular nominee (whether as a result of a vote AGAINST, a stockholder abstention or a broker non-vote) will not be counted in such nominee’s favor and will have no effect on the outcomeapproval of the election.Charter Amendment.
With respect to Proposal 2, you may vote FOR, AGAINST or ABSTAIN. If you ABSTAIN from voting on this proposal, your abstention will reduceact as a vote against approval of the overall majority requiredCharter Amendment to approve Proposal 2 as though you wereeffect the Reverse Stock Split. Shares represented by executed, but unmarked, proxies will be voted “FOR” the approval of the Charter Amendment to effect the Reverse Stock Split.
Broker non-votes are not entitledanticipated to vote or were not present at the meeting (by proxy or otherwise).
With respect to Proposal 3, you may vote FOR, AGAINST or ABSTAIN. If you ABSTAIN from voting on this proposal, your abstention will reduce the overall majority
required to approve Proposal 3 as though you were not entitled to vote or were not present at the meeting (by proxy or otherwise).be received since both proposals are routine matters.
Who will count the votes?
Broadridge Corporate Issuer Solutions, Inc. (“Broadridge”) has been engaged to receive and tabulate stockholder votes. Broadridge will separately tabulate FOR and AGAINST votes, abstentions, and broker non-votes. Broadridge will also certify the election results and perform any other acts required by the Delaware General Corporation Law.
Who is paying for the costs of this proxy solicitation?
We will bear the entire cost of proxy solicitation, including the preparation, assembly, printing, mailing and distribution of the proxy materials. Solicitations may be made personally or by mail, facsimile, telephone, messenger, or via the Internet by our personnel who will not receive additional compensation for such solicitation. In addition, we will reimburse brokerage firms and other custodians for their reasonable out-of-pocket expenses for forwarding the proxy materials to stockholders.
How can I find the results of the AnnualSpecial Meeting?
Preliminary results will be announced at the AnnualSpecial Meeting. Final results also will be published in a Current Report on Form 8-K to be filed with the Securities and Exchange Commission (the “SEC”) after the AnnualSpecial Meeting.
What does it mean if I receive more than one set of printed materials?
If you receive more than one set of printed materials, your shares may be registered in more than one name and/or are registered in different accounts.
Please follow the voting instructions on each set of printed materials, as applicable, to ensure that all of your shares are voted.
I share an address with another stockholder, and we received only one paper copy of the proxy materials. How may I obtain an additional copy of the proxy materials?
The SEC has adopted rules that allow a company to deliver a single proxy statement or annual report to an address shared by two or more of its stockholders. This method of delivery, known as “householding,” permits us to realize significant cost savings, reduces the amount of duplicate information stockholders receive, and reduces the environmental impact of printing and mailing documents to our stockholders. Under this process, certain stockholders will receive only one copy of our proxy materials and any additional proxy materials that are delivered until such time as one or more of these stockholders notifies us that they want to receive separate copies. Any stockholders who object to or wish to begin householding may notify our Investor Relations Department at investors@summitplc.com or Investor Relations, Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 02142.2882 Sand Hill Road, Suite 106, Menlo Park, California 94025.
Beneficial owners may contact their broker, bank or other nominee to request information about householding.
What is the deadline to propose actions for consideration at next year’s annual meeting of stockholders or to nominate individuals to serve as directors?
Stockholder Proposals for 2023 Annual Meeting
Meeting. The submission deadline for stockholder proposals to be included in our proxy materials for the 2023 annual meeting of stockholders pursuant to Rule 14a-8 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is December 30, 2022 except as may otherwise be provided in Rule 14a-8. All such proposals must be in writing and received by our Corporate Secretary at Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 021422882 Sand Hill Road, Suite 106, Menlo Park, California 94025 by close of business on the required deadline in order to be considered for inclusion in our proxy materials for the 2023 annual meeting of stockholders. Submission of a proposal before the deadline does not guarantee its inclusion in our proxy materials.
Advance Notice Procedure for 2023 Annual Meeting
Meeting. Under our Bylaws, director nominations and other business may be brought at an annual meeting of stockholders in accordance with the requirements of our Bylaws as in effect from time to time. For the 2023 annual meeting of stockholders, a stockholder notice must be received by our Corporate Secretary at Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 02142,2882 Sand Hill Road, Suite 106, Menlo Park, California 94025, not later than the close of business on the 90th day nor earlier than the close of business on the 120th day before the one-year anniversary of the date of our 2022 annual meeting of stockholders. However, if the 2023 annual meeting of stockholders is advanced by more than 30 days prior to, or delayed by more than 60 days after, the one-year anniversary of the 2022 annual meeting of stockholders, then, for notice by the stockholder to be timely, it must be received by our Corporate Secretary not earlier than the close of business on the 120th day prior to the 2023 annual meeting of stockholders and not later than the close of business on the later of (i) the 90th day prior to the 2023 annual meeting of stockholders, or (ii) the 10th day following the day on which notice of the date of such annual meeting was mailed or the day of public disclosure of the date of such annual meeting, whichever first occurs. Please refer to the full text of our Bylaw provisions for additional information and requirements. A copy of our current Bylaws has been filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and may be obtained by writing to our Corporate Secretary at the address listed in our proxy materials.
SPECIAL NOTE REGARDING THE REDOMICILIATION
PROPOSAL 1
AMENDMENT TO THE CHARTER TO INCREASE
THE AUTHORIZED NUMBER OF SHARES OF COMMON STOCK
Our Board of Directors has unanimously adopted, and is submitting for stockholder approval, an amendment to our Charter to increase the number of authorized shares of our common stock by 650,000,000 (from 350,000,000 to 1,000,000,000) with the final decision of whether to proceed with the increase in the number of authorized shares to be determined by our Board of Directors, in its discretion, following stockholder approval (if obtained), but no later than _______, 202_.
The additional shares of common stock to be authorized for issuance under the Charter would be a part of the existing class of common stock and, if and when issued, would have the same rights and privileges as the common stock presently issued and outstanding. Our common stock has no preemptive rights to purchase common stock or other securities.
If this Proposal 1 is approved by the requisite vote of the stockholders, the proposed Capitalization Increase will be subject to the final Board determination of whether to implement, which may be at any time prior to the one year anniversary of the stockholder approval date. In the event of stockholder approval of both the Capitalization Increase and the Reverse Stock Split, the Board will have discretion as to whether to adopt neither, one or both proposals at any time prior to the one year anniversary of the stockholder approval date. If adopted by the Board following approval by the requisite vote of the stockholders, the Capitalization Increase will become effective upon its filing and recording with the Secretary of State of Delaware.
Form of the Amendment
The Board has deemed the Capitalization Increase advisable and in the best interests of the Company and is accordingly submitting it to stockholders for approval. The Capitalization Increase would revise the Company’s Restated Certificate of Incorporation, dated September 18, 2020, Summit Therapeutics Inc., a Delaware corporation, or New Summit, becameas amended by that Amendment to the successor issuer to Summit Therapeutics plc, a public limited company incorporated underRestated Certificate of Incorporation, dated July 27, 2022, by replacing the lawsfirst paragraph of England and Walesits FOURTH Article with the Registrarfollowing language:
“The total number of Companiesshares of Englandall classes of capital stock that the Corporation shall have authority to issue is 1,020,000,000 shares, consisting of (i) 1,000,000,000 shares of common stock, $0.01 par value per share (the “Common Stock”), and Wales, United Kingdom,(ii) 20,000,000 shares of Preferred stock, $0.01 par value per share (the “Preferred Stock”).”
The full text of the proposed Charter Amendment is set forth in Annex A of this proxy statement. No changes are proposed to the number of authorized shares of preferred stock.
Reasons for the Increase in the Number of Authorized Shares
The proposed increase in the authorized number of shares of common stock is intended to ensure that we will continue to have an adequate number of authorized and unissued shares of common stock for future use. As of December 5, 2022, the Company had ______ shares of common stock issued and outstanding and an aggregate of ______ shares reserved for potential future issuance under outstanding awards under its 2020 Stock Incentive Plan, 2020 Employee Stock Purchase Plan, and 2016 Long Term Incentive Plan.
The Company has been in various stages of communication with multiple entities in order to pursue potential business development opportunities and may continue to seek to engage with these or Old Summit,other opportunities. However, given the inherent uncertainty in nature of these discussions, there can be no assurances that these discussions will result in actual transactions, collaborations, or other business development opportunities. These potential business opportunities may result in an upfront cash outlay to consummate these transactions, a commitment for additional funds to be paid upon the achievement of certain purposes under bothpre-determined milestones, and royalties to be paid upon the Securities Actpotential commercialization of 1933, as amended,certain product candidates. These milestone payments, if achieved, could result in multiple payments over the course of the next several years in addition to commercial-based royalties. The exact time period of these payments and amounts to be paid cannot be known and are dependent upon final negotiated agreements and the Securities Exchange Actachievement of 1934, as amended,predetermined milestone achievements so agreed. Depending on when, or if, the Exchange Act. Such succession occurred pursuant to a scheme of arrangement under UK law, which resulted in New Summit becoming the holding company of Old Summit (the predecessor registrant and former holding company) and its subsidiaries, which we refer to as the "Redomiciliation Transaction." On September 18, 2020, Old Summit was convertedCompany enters into a private limited company undertransaction, collaboration, or other business development opportunity, the laws of EnglandCompany may be required to issue and Wales and renamed Summit Therapeutics Limited.
Unless the context requires otherwise, all references in this Proxy Statementsell equity securities to "Summit," "the Summit Group," "the Company," "we," "ours," "us," or similar terms on or prior to September 18, 2020 (the effective date of the Redomiciliation Transaction), refer to our predecessor, Summit Therapeutics plc, together with its subsidiaries.raise capital.
CORPORATE GOVERNANCE
Overview
Our Board of Directors oversees our Chief Executive Officer and other senior managementrecommends the proposed increase in the competentauthorized number of shares of common stock to facilitate issuing shares in the event that the Board determines that it is necessary or appropriate to (i) provide financial flexibility to raise additional capital through the sale of equity securities, convertible securities or other equity-linked securities, (ii) enter into strategic business transactions, (iii) provide equity incentives to directors, officers and ethical operationemployees pursuant to equity compensation plans or (iv) other general corporate purposes. The availability of additional shares of common stock is particularly important in the event that the Board needs to undertake any of the foregoing actions on an expedited basis, as market conditions permit and favorable financing and business opportunities become available, and thus without the potential delay and expense associated with convening a special stockholders’ meeting. In considering and planning for our current and future corporate needs, our Board believes that the current number of authorized and unreserved shares of common stock available for issuance is inadequate. If stockholders do not vote to approve this Proposal 1, the Company may be unable to issue shares when needed; approving this Proposal 1 will help avoid that issue.
The Board has not authorized the Company to take any action with respect to the shares that would be authorized under this proposal, and the Company currently does not have any definitive agreements with respect to the issuance of the additional shares of common stock to be authorized by the Capitalization Increase.
Effects of the Increase in the Number of Authorized Shares
If our stockholders approve this proposal to increase the number of authorized shares of common stock, unless otherwise required by applicable law or stock exchange rules, our Board will be able to issue the additional shares of common stock from time to time in its discretion without further action or authorization by stockholders. The newly authorized shares of common stock would be issuable for any proper corporate purposes, including future capital raising transactions of equity or convertible debt securities, acquisitions, investment opportunities, the establishment of collaborations or other strategic agreements, stock splits, stock dividends, issuance under current or future equity incentive plans or for other general corporate purposes.
The proposed increase in the number of authorized shares of common stock will not, by itself, have an immediate dilutive effect on our current stockholders. However, the future issuance of additional shares of common stock or securities convertible into our common stock could, depending on the circumstances, have a dilutive effect on the earnings per share, book value per share, voting power and percentage interest of our businessexisting stockholders, none of whom have preemptive rights to subscribe for additional shares of common stock that we may issue, and affairs and assures thatcould depress the long-term interestsmarket price of the common stock. We may sell shares of common stock at a price per share that is less than the current price per share and less than the price per share paid by our current stockholders. We may also sell securities in the future that could have rights superior to existing stockholders.
Potential Anti-Takeover Effect
An increase in the number of authorized shares of common stock may also, under certain circumstances, be construed as having an anti-takeover effect. Although not designed or intended for such purposes, the effect of the proposed increase might be to render more difficult or to discourage a merger, tender offer, proxy contest or change in control of us and the removal of management, which stockholders are being served. Our Board of Directors has adopted Corporate Governance Guidelines that address items such asmight otherwise deem favorable. For example, the qualifications and responsibilities of our directors and director candidates and corporate governance policies and standards applicable to us in general. We believe that good governance leads to high board effectiveness, promotes the long-term interests of our stockholders, strengthens the accountabilityauthority of our Board to issue common stock might be used to create voting impediments or to frustrate an attempt by another person or entity to effect a takeover or otherwise gain control of Directors and management and improvesus because the issuance of additional shares of common stock would dilute the voting power of the common stock then outstanding. Our common stock could also be issued to purchasers who would support our standingBoard in opposing a takeover bid which our Board determines not to be in our industry.
Board Leadership Structure
Our Board of Directors believes that the roles of Chairmanbest interests and Chief Executive Officer may be filled by the same or different individuals. This allows our Board of Directors to have the flexibility to determine whether the two roles should be combined or separated based upon the needs of the Company and our Board of Directors’ assessmentthose of our leadership from timestockholders.
The Board is not presently aware of any attempt, or contemplated attempt, to time. Our Board of Directors also believes that combining the role of Chairman and Chief Executive Officer facilitates the strategic developmentacquire control of the Company and the flowproposed Charter Amendment to increase the number of information betweenauthorized shares of common stock is not part of any plan by our Board to recommend or implement a series of anti-takeover measures.
Effectiveness of the Charter Amendment and Required Vote
Upon receipt of the necessary stockholder approval, the Board will make a final determination as to whether to proceed and management. In our Board’s view, the Chief Executive Officer is best situated to serve as Chairman because of his familiarityfile with the Company’s business and industry and his insight into the strategies and policies to be discussed by the BoardSecretary of Directors. At this time, our Board of Directors believes it is in the best interests of our Company and our stockholders for Robert W. Duggan to serve as our Chief Executive Officer and ChairmanState of the State of Delaware the amendment to its Charter to implement the Capitalization Increase. The amendment to the Charter to effect the Capitalization Increase would become effective upon such filing. Our Board of Directors. The Chairmanreserves the right, notwithstanding stockholder approval of the Board of Directors presides over all Board meetings and approves the agenda for meetings of the Board of Directors. He also works with the Board of Directors to drive decisions about particular strategies and policies.
The Board of Director’s Role in Risk Oversight
Our management has day-to-day responsibility for identifying risks facing us, including implementing suitable mitigating processes and controls, assessing risks in relation to Company strategies and objectives, and appropriately managing risks in a manner that serves the best interests of the Company, our stockholders, and other stakeholders. Our Board of Directors is responsible for ensuring that an appropriate culture of risk management exists within the Company and for setting the right “tone at the top,” overseeing our aggregate risk profile, and assisting management in addressing specific risks.
Generally, various committees of our Board of Directors oversee risks associated with their respective areas of responsibility and expertise. For example, our Audit Committee oversees, reviews and discusses with management and the independent auditor risks associated with our internal controls and procedures for financial reporting and the steps management has taken to monitor and mitigate those exposures; our Audit Committee also oversees the management of other risks, including those associated with credit risk. Our Compensation Committee oversees the management of risks associated with our compensation policies, plans and practices. Our Nominating and Corporate Governance Committee oversees the management of risks associated with director independence and the composition and organization of the Board of Directors. Management and other employees report to the Board of Directors and/or relevant committee from time to time on risk-related issues.
Capitalization Increase and without further action by our stockholders, not to proceed with the amendment at any time before the filing of the Capitalization Increase.
Vote Required
In accordance with Delaware law, approval and adoption of this proposal requires the affirmative vote of at least a majority of our issued and outstanding shares entitled to vote either in person or by proxy at the meeting. Accordingly, abstentions will have the same effect as a vote against the proposal. Shares represented by valid proxies and not revoked will be voted at the meeting in accordance with the instructions given. If no voting instructions are given, such shares will be voted “FOR” this proposal.
The Board of Directors unanimously recommends a vote “FOR” the amendment to the Charter to increase the authorized
number of shares of Common Stock.
Director Independence
Under applicable Nasdaq rules,
PROPOSAL 2
APPROVAL OF AMENDMENT TO THE CHARTER TO EFFECT A REVERSE STOCK SPLIT
Background and Proposed Amendment
Our Board of Directors has unanimously adopted, and is submitting for stockholder approval, an amendment to our Charter, as amended, in substantially the form attached hereto as Annex B (the “Reverse Stock Split Charter Amendment”) to effect the Reverse Stock Split at a director will only qualify as an “independent director” if, inratio of between 1-for-5 and 1-for-10, with the opinionfinal decision of whether to proceed with the Reverse Stock Split and the exact ratio of the listed company’s board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In orderReverse Stock Split to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee, accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries or otherwise be an affiliated person of the listed company or any of its subsidiaries. In order to be considered independent for purposes of Rule 10C-1, the board must consider, for each member of a compensation committee of a listed company, all factors specifically relevant to determining whether a director has a relationship to such company which is material to that director’s ability to be independent from management in connection with the duties of a compensation committee member, including, but not limited to: (1) the source of compensation of the director, including any consulting advisory or other compensatory fee paiddetermined by such company to the director; and (2) whether the director is affiliated with the company or any of its subsidiaries or affiliates.
Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, our Board of Directors, has determinedin its discretion, following stockholder approval (if obtained), but no later than ________, 202_. If the stockholders approve the Reverse Stock Split, and the Board decides to implement it, the Reverse Stock Split will become effective upon the filing of the Reverse Stock Split Charter Amendment with the Delaware Secretary of State. In the event of stockholder approval of both the Capitalization Increase and the Reverse Stock Split, the Board will have discretion as to whether to adopt neither, one or both proposals at any time prior to the one year anniversary of the stockholder approval date.
The Reverse Stock Split will be realized simultaneously for all outstanding common stock. The Reverse Stock Split will affect all holders of common stock uniformly and no stockholder’s interest in the Company will be diluted as each stockholder will hold the same percentage of common stock outstanding immediately following the Reverse Stock Split as that stockholder held immediately prior to the Reverse Stock Split, except for immaterial adjustments that may result from the treatment of fractional shares as described below. The Reverse Stock Split Charter Amendment will not reduce the number of authorized shares of common stock (which will remain at 350,000,000) and will not change the par value of the common stock (which will remain at $0.01 per share).
Reasons for the Reverse Stock Split
With a high number of issued and outstanding shares of common stock, the price per each of Mr. Clark, Ms. Mahatme and Mr. Soni, representing threeshare of our six directors,common stock may be too low for the Company to attract investment capital on reasonable terms for the Company. We believe that the Reverse Stock Split will make our common stock more attractive to a broader range of institutional investors, professional investors and other members of the investing public. Many brokerage houses and institutional investors have internal policies and practices that either prohibit them from investing in low-priced stocks or tend to discourage individual brokers from recommending low-priced stocks to their customers. In addition, some of those policies and practices may function to make the processing of trades in low-priced stocks economically unattractive to brokers. Moreover, because brokers’ commissions on low-priced stocks generally represent a higher percentage of the stock price than commissions on higher-priced stocks, the current average price per share of common stock can result in individual stockholders paying transaction costs representing a higher percentage of their total share value than would be the case if the share price were substantially higher. We believe that the Reverse Stock Split may make our common stock a more attractive and cost-effective investment for many investors, which may enhance the liquidity of the holders of our common stock.
In addition, we believe that the Reverse Stock Split will help us achieve a number of important goals, including enhancing our ability to continue to satisfy the continued listing requirements of Nasdaq Capital Market. One of the listing requirements common to national securities exchanges is “independent”that the bid price of our common stock be at a specified minimum per share. Reducing the number of outstanding shares of our common stock should, absent other factors, result in an increase in the per share market price of our common stock, although we cannot provide any assurance that our minimum bid price would, following the Reverse Stock Split, remain over any applicable minimum bid price requirements. The Reverse Stock Split will also effectively increase the number of authorized and unissued shares of our common stock available for future issuance by the amount of the reduction in outstanding shares effected by the Reverse Stock Split.
Although reducing the number of outstanding shares of our common stock through the Reverse Stock Split is intended, absent other factors, to increase the per share market price of our common stock, other factors, such as our financial results, market conditions and the market perception of our business, may adversely affect the market price of our common stock. As a result, there can be no assurance that termthe Reverse Stock Split, if completed, will result in the intended benefits described above, or that the market price of our common stock will increase (proportionately to the reduction in the number of shares of our common stock after the Reverse Stock Split or
otherwise) following the Reverse Stock Split or that the market price of our common stock will not decrease in the future.
If the Reverse Stock Split Charter Amendment is definedeffected, it would cause a decrease in the total number of shares of our common stock outstanding and increase the market price of our common stock, as well as effectively increase the number of authorized and unissued shares of our common stock available for future issuance. The Board intends to effect the Reverse Stock Split only if it believes that a decrease in the number of shares outstanding is in the best interests of the Company and our stockholders and is likely to improve the trading price of our common stock and improve the likelihood that we will be able to satisfy the continued listing requirements of Nasdaq Capital Market. Accordingly, our Board approved the Reverse Stock Split Charter Amendment and recommended it be submitted to stockholders for approval.
Consequences of Not Obtaining Stockholder Approval of the Reverse Stock Split
If we do not obtain stockholder approval of the Reverse Stock Split and if we need additional capital to fund operations and at such time do not have a sufficient number of authorized and unissued shares of common stock to raise such additional capital, our business would be materially and adversely affected. In addition, if we are unable to satisfy the continued listing requirements for the Nasdaq Capital Market, we may be delisted from the exchange.
If stockholder approval for the Reverse Stock Split is not obtained, the number of shares of our common stock that are issued and outstanding will not change and the anticipated benefits of the Reverse Stock Split described above under “Reasons for the rulesReverse Stock Split” will not be achieved.
Principal Effects of The Nasdaqthe Reverse Stock Market and noneSplit
A reverse stock split refers to a reduction in the number of these directors has or has had a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilitiesoutstanding shares of a director.
Our Boardclass of Directors also determined that Mr. Clark, Ms. Mahatme and Mr. Soni, who comprise our Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee, satisfy the independence standards for those committees established by applicable SEC rules, including Rule 10A-3 of the Exchange Act, and the rules of The Nasdaq Stock Market. In making this determination, our Board of Directors considered the relationships that each non-employee director has or has had with our Company and all other facts and circumstances that our Board of Directors deemed relevant in determining their independence, including the beneficial ownership of oura corporation’s capital stock, which may be accomplished, as in this case, by each non-employee director.
Under The Nasdaq Stock Market listing requirements, a company of which more than 50% of the voting power is held by an individual, group, or another company is a “controlled company.” Because Mr. Duggan owns more than a majority of the voting powerreclassifying and combining all of our outstanding shares of common stock we areinto a “controlled company” underproportionately smaller number of shares. For example, a stockholder holding 100,000 shares of common stock before the corporate governance rules for Nasdaq-listed companies. A “controlled company” may elect not to comply with certain Nasdaq corporate governance requirements, includingreverse stock split would instead hold 10,000 shares of common stock immediately after the requirements that:
•a majority ofreverse stock split if the ratio at which the board of directors consistdetermines the ratio to be 1-for-10. Each stockholder’s proportionate ownership of independent directors;
•outstanding shares of common stock would remain the compensation committee be composed entirelysame, subject to immaterial adjustments due to the issuance of directors meeting Nasdaq independence standards applicable to compensation committee members withan additional share in lieu of a written charter addressing the committee's purposefractional share. All shares of common stock will remain validly issued, fully paid and responsibilities;
•the compensation committee be responsible for the hiring and overseeing of persons acting as compensation consultants and be required to consider certain independence factors when engaging such persons; and
•director nominees either be selected, or recommended for board of directors' selection, either by “independent directors” as defined under the rules of Nasdaq
constituting a majorityAfter the Effective Time, as defined below, of the boardReverse Stock Split, our common stock will have a new committee on uniform securities identification procedures number, also known as a CUSIP number, which is a number used to identify our common stock. Our common stock is currently registered under Section 12(b) of director's "independent directors" in a vote in which only “independent directors” participate, or by a nominations committee comprised solely of “independent directors.”
We have elected to take advantage of these exemptions. As a result, our stockholders may not have the same protections afforded to stockholders of companies thatExchange Act, and we are subject to allthe periodic reporting and other requirements of the Nasdaq corporate governance rules.Exchange Act. The proposed Reverse Stock Split will not affect the registration of our common stock under the Exchange Act.
Effect on Authorized but Unissued Shares
Director Nominations
Candidates for nominationPursuant to the Reverse Stock Split Charter Amendment, each holder of our Board of Directors are selected bycommon stock outstanding immediately prior to the Nominating and Corporate Governance Committee in accordance with the committee’s charter, and our Certificate of Incorporation and Bylaws. The Nominating and Corporate Governance Committee evaluates all candidates in the same manner and using the same criteria, regardlesseffectiveness of the sourceReverse Stock Split (“Old Common Stock”) will become the holder of fewer shares of our common stock (“New Common Stock”) after consummation of the recommendation.Reverse Stock Split.
The Nominatingtable below provides examples of reverse stock splits at various ratios between 1-for-5 and Corporate Governance Committee may retain recruiting professionals to assist in identifying and evaluating candidates for director nominees. Our Board of Directors has adopted Corporate Governance Guidelines and the Nominating and Corporate Governance Committee has adopted Policies and Procedures for Director Candidates which sets out, among other things, that the Nominating and Corporate Governance Committee considers factors such as character, integrity, judgment, diversity of experience (including age, gender, international background, race and professional experience), independence, area of expertise, length of service, potential conflicts of interest, other commitments and the like. The Nominating and Corporate Governance Committee considers the following minimum qualifications to be satisfied by any nominee1-for-10, without giving effect to the Boardtreatment of Directors: a reputation for integrity, honesty and adherence to high ethical standards; a demonstrated business acumen, experience and ability to exercise sound judgments in matters that relatefractional shares. The actual number of shares outstanding after giving effect to the current and long-term objectives of the Company; a commitment to understanding the Company and its industry; a commitment to regularly attend and participate in meetings of the Board and its committees; an interest and ability to understand the sometimes conflicting interests of the various constituencies of the Company, including stockholders, employees, customers, governmental units, creditors and the general public, and to act in the interests of all stockholders. BasedReverse Stock Split, if effected, will depend on the Nominating and Corporate Governance Committee’s recommendation, the Board of Directors selects director nominees and recommends them for electionactual ratio that is determined by our stockholders, and also fills any vacancies that may arise between annual meetingsboard of stockholders.
The Nominating and Corporate Governance Committee will consider director candidates who are proposed by our stockholders in accordance with our Bylaws, our Nominating and Corporate Governance Committee’s Policies and Procedures for Director Candidates and other procedures established from time to time by the Nominating and Corporate Governance Committee. If you would like the Nominating and Corporate Governance Committee to consider a prospective director candidate, please follow the procedures in our Bylaws and submit the candidate’s name and qualifications to: Corporate Secretary, Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 02142.
Code of Business Conduct and Ethics
We have also adopted a written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of the code is posted on the “Investors” section of our website, which is located at https://www.summittxinc.com/. If we make any substantive amendments to, or grant any waivers from,
the code of business conduct and ethics for any officer or director, we will disclose the nature of such amendment or waiver on our website or in a current report on Form 8-K to be filed with the SEC.
Policy on Short Sales, Derivative Transactions and Hedging Transactions
The Company’s Insider Trading Policy prohibits any director or employee from engaging in any of the following types of transactions with respect to the Company’s securities: (i) short sales, including short sales “against the box”, (ii) purchases or sales of puts, calls, or other derivative securities or (iii) purchases of financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds) or other similar transactions that directly hedge or offset, or are designed to directly hedge or offset, any decrease in the market value of Company securities.
Communication with the Board of Directors
Any stockholder communication with our Board of Directors or individual directors should be directed to Summit Therapeutics Inc., c/o Corporate Secretary, One Broadway, 14th Floor, Cambridge, Massachusetts 02142. The Corporate Secretary will forward these communications, as appropriate, directly to the director(s). The independent directors of the Board of Directors review and approve the stockholder communication process periodically in an effort to enable an effective method by which stockholders can communicate with the Board of Directors.
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
Board and Committee Meetings
Our Board of Directors and its committees meet throughout the year on a set schedule, hold special meetings as needed, and act by written consent from time to time. During fiscal year 2021, our Board of Directors held 5 meetings, and each director attended at least 75% of the aggregate of (i) the total number of meetings of our Board of Directors held during the period for which he or she has been a director and (ii) the total number of meetings held by all committees of our Board of Directors on which he or she served during the periods that he or she served.
The names of our director nominees and directors, their ages and certain other information about them are set forth below:directors.
| | | | | | | | |
Name | Age | Position | | | | | | | | | |
Robert W. DugganShares outstanding at December 5, 2022 | 78 | Chief Executive Officer and Executive ChairmanReverse Stock Split Ratio | | Shares outstanding after Reverse Stock Split | | Reduction in Shares Outstanding |
Mahkam Zanganeh[201,321,175] | 51 | Director and Chief Operations Officer1-for-5 | | [40,264,235] | | 80% |
Kenneth A. Clark[201,321,175] | 63 | Director |
Urte Gayko1-for-10 | 51 | Director, Head of Regulatory Affairs, Quality Assurance, and Safety |
Ujwala Mahatme[20,132,118] | 57 | Director |
Manmeet S. Soni | 44 | Director90% |
The principal occupations and positions and directorships for at least the past five years of our directors and director nominees, as well as certain information regarding their individual experience, qualifications, attributes and skills that led our Board of Directors to conclude that they should serve on the Board of Directors, are described below. There are no family relationships among any of our directors or executive officers, however, Mr. Duggan and Dr. Zanganeh have a personal relationship with each other.
Robert W. Duggan, age 78, has served as a member of our Board of Directors since December 2019, Executive Chairman since February 2020 and Chief Executive Officer since April 2020. Since 2016, Mr. Duggan has been Chief Executive Officer of Duggan Investments, Inc., a venture capital and public equity investment firm primarily focused on patient-friendly breakthrough solutions to complex diseases of aging. From September 2007 through the acquisition by AbbVie Inc. in May 2015, Mr. Duggan was a member of the board of directors of Pharmacyclics, Inc., a patient-friendly, science-based, employee-driven developer of small-molecule medicines for the treatment of cancers. Mr. Duggan was also the Chairman and Chief Executive Officer of Pharmacyclics from September 2008 to May 2015 as well as its largest investor. From 1990 to 2003, Mr. Duggan was chairman of the board of directors of Computer Motion, Inc. From 1997 to 2003, Mr. Duggan also served as Chief Executive Officer of Computer Motion. In June 2003, Computer Motion merged with Intuitive Surgical Inc. Mr. Duggan has been a director and the chairman of the board of directors of Pulse Biosciences, Inc. since November 2017. From 2003 to 2011, Mr. Duggan served on the board of directors of Intuitive Surgical. Mr. Duggan received a U.S. Congressman’s Medal of Merit from Ron Paul in 1985 and in 2000 he was named a Knight of the Legion of Honor by President Jacques Chirac of France. He is a member of the University of California at Santa Barbara Foundation board of trustees.
Mr. Duggan was appointed as a director because of his significant combined service as Chief Executive Officer of an innovative biopharmaceutical company and career spanning over
30 yearsThe Reverse Stock Split will affect all stockholders equally and will not affect any stockholder’s proportionate equity interest in the Company, except for those stockholders who receive an additional share of our common stock in lieu of a fractional share. None of the rights currently accruing to holders of our common stock will be affected by the Reverse Stock Split. Following the Reverse Stock Split, each share of New Common Stock will entitle the holder thereof to one vote per share and will otherwise be identical to Old Common Stock. The Reverse Stock Split also will have no effect on the number of authorized shares of our Common Stock. The shares of New Common Stock will be fully paid and non-assessable.
The par value per share of the Common Stock will remain unchanged at $0.01 per share after the Reverse Stock Split. As a result, on the Effective Time of the Reverse Stock Split, if any, the stated capital on our balance sheet attributable to the common stock will be reduced proportionately based on the Reverse Stock Split ratio, from its present amount, and the additional paid-in capital account will be credited with the amount by which the stated capital is reduced. After the Reverse Stock Split, net income or loss per share and other per share amounts will be increased because there will be fewer shares of our common stock outstanding. In future financial statements, net income or loss per share and other per share amounts for periods ending before the Reverse Stock Split would be recast to give retroactive effect to the Reverse Stock Split. The Company does not anticipate that any other accounting consequences would arise as a venture investor and advisor for a broad rangeresult of companies, and extensive expertise in vision, strategic development, planning, finance and management.the Reverse Stock Split.
Risks Associated with the Reverse Stock Split
Mahkam “Maky” ZanganehThe Reverse Stock Split may not increase the price of our common stock over the long-term, age 51, has served. As noted above, a principal purpose of the Reverse Stock Split is to increase the trading price of our common stock to enhance our ability to satisfy Nasdaq Capital Market’s continued listing requirements. However, the effect of the Reverse Stock Split on the market price of our common stock cannot be predicted with any certainty, and we cannot assure you that the Reverse Stock Split will accomplish this objective for any meaningful period of time, or at all. While we expect that the reduction in the number of outstanding shares of common stock will proportionally increase the market price of our common stock, we cannot assure you that the Reverse Stock Split will increase the market price of our common stock by a multiple of the Reverse Stock Split ratio, or result in any permanent or sustained increase in the market price of our common stock. The market price of our common stock may be affected by other factors which may be unrelated to the number of shares outstanding, including the Company’s business and financial performance, general market conditions, and prospects for future success.
The Reverse Stock Split may decrease the liquidity of our common stock. The Board believes that the Reverse Stock Split may result in an increase in the market price of our common stock, which could lead to increased interest in our common stock and possibly promote greater liquidity for our stockholders. However, the Reverse Stock Split will also reduce the total number of outstanding shares of common stock, which may lead to reduced trading and a smaller number of market makers for our common stock, particularly if the price per share of our common stock does not increase as a memberresult of the Reverse Stock Split.
The Reverse Stock Split may result in some stockholders owning “odd lots” that may be more difficult to sell or require greater transaction costs per share to sell. If the Reverse Stock Split is implemented, it will increase the number of stockholders who own “odd lots” of less than 100 shares of common stock. A purchase or sale of less than 100 shares of common stock (an “odd lot” transaction) may result in incrementally higher trading costs through certain brokers, particularly “full service” brokers. Therefore, those stockholders who own fewer than 100 shares of common stock following the Reverse Stock Split may be required to pay higher transaction costs if they sell their common stock.
The Reverse Stock Split may lead to a decrease in our overall market capitalization. The Reverse Stock Split may be viewed negatively by the market and, consequently, could lead to a decrease in our overall market capitalization. If the per share market price of our Boardcommon stock does not increase in proportion to the Reverse Stock Split ratio, or following such increase does not maintain or exceed such price, then the value of Directors and Chief Operations Officer since November 2020. Dr. Zanganeh is currently Founder, Chief Executive Officer and Director of Maky Zanganeh and Associates, an executive management and consulting firm foundedour Company, as measured by our market capitalization, will be reduced. Additionally, any reduction in 2015. Previously, from August 2012 to September 2015, she servedour market capitalization may be magnified as the Chief Operating Officer of Pharmacyclics Inc. She also served as Chief of Staff and Chief Business Officer of Pharmacyclics from December 2011 to July 2012 and Vice President, Business Development from August 2008 to November 2011. Prior to joining Pharmacyclics Inc., Dr. Zanganeh served as President Director General (2007-2008) for the French government bio-cluster project initiative in France, establishing alliances and developing small life science businesses regionally. From September 2003 to August 2008, Dr. Zanganeh served as Vice President of Business Development for Robert W. Duggan & Associates. Dr. Zanganeh also served as worldwide Vice President of Training & Education (2002-2003) and President Director General for Europe, Middle East and Africa (1998-2002) for Computer Motion Inc. Dr. Zanganeh has been a directorresult of the boardsmaller number of directorstotal shares of Pulse Biosciences, Inc. since February 2017. Dr. Zanganeh received a DDS degree from Louis Pasteur University in Strasbourg, France and MBA from Schiller International University in France.
Dr. Zanganeh was appointed as a director because of her years of executive and operational experience incommon stock outstanding following the life sciences industry.
Kenneth A. Clark, age 63, has served on our Board of Directors since October 2021. Mr. Clark is currently a partner at Wilson Sonsini Goodrich & Rosati ("WSGR") based out of the firm’s Palo Alto, CA, office. At WSGR, Mr. Clark advises biotech companies in strategic partnerships, mergers and acquisitions, and financing transactions, in addition to a range of other matters. Mr. Clark has previously served as a member of the boards of directors for multiple publicly traded companies, including Pulse BioSciences, Inc. and Pharmacyclics, Inc., in addition to serving two terms on WSGR’s Board of Directors. Mr. Clark received his undergraduate degree from Vanderbilt University and earned his juris doctorate from the University of Texas School of Law.Reverse Stock Split.
We believe Mr. Clark is qualified to serve on our Board of Directors because of his expertise in business consulting, deal transactions, financing, and corporate law in the biotechnology sector.
Urte Gayko, age 51, has served on our Board of Directors since November 2021. Dr. Gayko became the Head of Regulatory Affairs, Quality Assurance, and Safety at Summit in April 2022. Prior to joining Summit as an employee, she was the Senior Vice President of Drug Development & Regulatory Affairs at Nektar Therapeutics. Dr. Gayko previously served as the Global Head of Regulatory Affairs and Pharmacovigilance at Pharmacyclics, Inc., and has over 20 years of experience in areas encompassing regulatory and clinical development ranging from pre-commercial entities to large biopharmaceutical companies, including Amgen and AbbVie. Dr. Gayko performed her PhD research in molecular and cellular biology at Harvard University.
We believe Dr. Gayko is qualified to serve on our Board of Directors because of her expertise in the life sciences industry.
Ujwala Mahatme, age 57, has served as a member of our Board of Directors since July 2020. Currently, Ms. Mahatme serves as the Founder and Managing Partner of Mahatme Bitterman PLLC, a role she has held since 2002. Previously, Ms. Mahatme served as Counsel at Gibson, Dunn & Crutcher and Counsel and Counsel and Associate at Pillsbury Winthrop Shaw
Pittman LLP. She received her BachelorAnti-Takeover and Dilutive Effects
In addition, we have not proposed the Reverse Stock Split, with its corresponding increase in the authorized and unissued number of Commerceshares of common stock, with the intention of using the additional shares for anti-takeover purposes, although we could theoretically use the additional shares to make it more difficult or to discourage an attempt to acquire control of the Company.
We do not believe that our officers or directors have interests in this proposal that are different from Brihan Maharashtra Collegeor greater than those of Commerce, Universityany other of Poona, her Bachelorour stockholders.
Effect on Registered and Beneficial Stockholders
If you hold shares of Laws from ILS Law School, Universitycommon stock in “street name” through an intermediary, we will treat your common stock in the same manner as stockholders whose shares are registered in their own names. Intermediaries will be instructed to effect the Reverse Stock Split for their customers holding common stock in street name. However, these intermediaries may have different procedures for processing a reverse stock split. If you hold shares of Poona, Mastercommon stock in street name, we encourage you to contact your intermediaries.
Registered “Book-Entry” Holders of LawsCommon Stock
If you hold shares of common stock electronically in book-entry form with our transfer agent, Computershare Trust Company, N.A., you do not currently have and will not be issued stock certificates evidencing your ownership after the reverse stock split, and you do not need to take action to receive post-reverse stock split shares. If you are entitled to post-reverse stock split shares, a transaction statement will automatically be sent to you indicating the number of shares of common stock held following the reverse stock split.
Effect on Registered Stockholders Holding Certificates
Some stockholders of record hold their shares of our common stock in certificate form or a combination of certificate and book-entry form. If any of your shares of our common stock are held in certificate form, you will receive a letter of transmittal from the UniversityCompany’s transfer agent, Computershare Trust Company, N.A., containing instructions on how a stockholder should surrender its, his or her certificate(s) representing shares of CambridgeOld Common Stock to the transfer agent in exchange for certificate(s) representing shares of New Common Stock. No certificate(s) representing shares of New Common Stock will be issued to a stockholder until such stockholder has surrendered all certificate(s) representing shares of Old Common Stock, together with a properly completed and Masterexecuted letter of Lawstransmittal, to the transfer agent. No stockholder will be required to pay a transfer or other fee to exchange its, his or her certificate(s) shares of Old Common Stock for certificate(s) representing shares of New Common Stock registered in Corporation Law from New York University.the same name.
Effect on Outstanding Options and Warrants
Upon a reverse stock split, all outstanding options, warrants and future or contingent rights to acquire common stock will be adjusted to reflect the Reverse Stock Split. With respect to all outstanding options and warrants to purchase common stock, the number of shares of common stock that such holders may purchase upon exercise of such options or warrants will decrease, and the exercise prices of such options or warrants will increase, in proportion to the fraction by which the number of shares of common stock underlying such options and warrants are reduced as a result of the Reverse Stock Split. Also, the number of shares reserved for issuance under our existing stock incentive and employee stock purchase plans would be equitably adjusted by the Company in the manner determined by the Board.
Fractional Shares
Fractional shares will not be issued in connection with the Reverse Stock Split. Each stockholder who would otherwise hold a fractional share of common stock as a result of the Reverse Stock Split will receive one share of common stock in lieu of such fractional share. If such shares are subject to an award granted under an Incentive Plan, each fractional share of common stock will be rounded down to the nearest whole share of common stock in order to comply with the requirements of Sections 409A and 424 of the Code.
We believe Ms. Mahatme is qualified to serve on our Board of Directors because of her expertise in corporate law and financing in the biotechnology sector.
Manmeet Soni, age 44, has served as a member of our Board of Directors since December 2019. Since February 2022, Mr. Soni is the President, Chief Operating Officer and Chief Financial Officer of Reata Pharmaceuticals, Inc., a pharmaceutical company focused on developing small molecule therapeutics for the treatment of severe life-threatening diseases. Mr. Soni joined Reata in August 2019 as Chief Financial Officer, Executive Vice President and was promoted in June 2020 to Chief Operating Officer and Chief Financial Officer, Executive Vice President of Reata.
Prior to joining Reata Pharmaceuticals, Mr. Soni was the Senior Vice President and Chief Financial Officer of Alnylam Pharmaceuticals Inc. from May 2017 to August 2019. From March 2016 to February 2017, Mr. Soni served as Executive Vice President, Chief Financial Officer and Treasurer of ARIAD Pharmaceuticals, Inc., a biopharmaceutical company, when ARIAD was acquired by Takeda Pharmaceutical Company Limited. Mr. Soni continued as an employee of ARIAD through May 2017. Previously, he served as Chief Financial Officer of Pharmacyclics, Inc., a biopharmaceutical company, until its acquisition by AbbVie in 2015. Prior to joining Pharmacyclics, Mr. Soni worked at Zeltiq Aesthetics Inc., a publicly held medical technology company as Corporate Controller. Prior to Zeltiq, Mr. Soni worked at PricewaterhouseCoopers in the life science and venture capital group. Prior to that, he worked at PricewaterhouseCoopers India providing audit and assurance services. Mr. Soni currently serves as a member of the board of directors of Pulse Biosciences, Inc. since November 2017 and previously served as a member of the board of directors of Arena Pharmaceuticals,Inc. from December 2018 to June 2021. Mr. Soni is a Certified Public Accountant and Chartered Accountant (India).
Mr. Soni was appointed as a director because of his extensive experience in the life sciences industry and his financial and accounting expertise.
Board Committees
Our Board of Directors has an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee, each of which has the composition and the responsibilities described below. The Audit Committee, Compensation Committee, and Nominating and Corporate Governance Committee all operate under charters approved by our Board of Directors, which charters are available on the Investors page of our website at https://www.summittxinc.com under “Corporate Governance.” Our Board of Directors from time to time establishes additional committees to address specific needs.
The following table sets forth (i) the three standing committees of the Board of Directors, (ii) the members of each committee as of December 31, 2021, and (iii) the number of meetings held by each committee in fiscal year 2021:
| | | | | | | | | | | |
| Name of Director | Audit | Compensation | Nominating
and Corporate Governance |
| Robert W. Duggan | | | |
| Mahkam Zanganeh | | | |
Kenneth A. Clark(1) | X | X | X (Chair) |
Ujwala Mahatme(2), (3) | X | X | |
Urte Gayko(3) | | | X |
Manmeet S. Soni(4) | X (Chair) | X (Chair) | X |
| | | |
| Number of Meetings Held During 2021 | 8 | 5 | 1 |
_______________
(1)Mr. Clark was elected as a director on October 7, 2021. He was appointed as a member ofUnder the Audit Committee, Compensation, and Nominating and Corporate Governance Committees. He was appointed as Chair of the Nominating and Corporate Governance Committee on December 17, 2021.
(2)Ms. Mahatme was elected as a member of the Compensation Committee on October 7, 2021.
(3)Dr. Gayko was elected as a director on November 3, 2021. She was appointed as a member of the Nominating and Corporate Governance Committee in connection with her election. Ms. Mahatme replaced Dr. Gayko on the Nominating and Corporate Governance Committee effective April 28, 2022 in connection with Dr. Gayko's agreementDelaware General Corporation Law, our stockholders are not entitled to join the Company as an employee.
Our Corporate Governance Guidelines set out that all directors are expected to attend our annual meeting of stockholders. All of the current Board members who were members of the Board at our 2021 annual stockholder meeting attended such meeting.
Audit Committee
Our Audit Committee oversees our corporate accounting and financial reporting process and assists the Board of Directors in monitoring our financial systems and our legal and regulatory compliance. Our Audit Committee is responsible for, among other things:
•appointing, approving the compensation of, and assessing the independence of our registered public accounting firm;
•overseeing the work of our registered public accounting firm, including through the receipt and consideration of reports from the such firm;
•reviewing and discussing with management and the registered public accounting firm our annual and quarterly financial statements and related disclosures;
•monitoring our internal control over financial reporting, disclosure controls and procedures and code of business conduct and ethics;
•establishing policies regarding the receipt and retention of accounting related complaints and concerns;
•meeting independently with our internal auditing staff, if any, our registered public accounting firm and management;
•reviewing and approvingappraisal or ratifying any related person transactions; and
•preparing the Audit Committee report required by SEC rules.
The members of our Audit Committee are Mr. Clark, Ms. Mahatme and Mr. Soni. Mr. Soni serves as our Audit Committee Chair. Our Board of Directors has determined that each member of our Audit Committee is independent within the meaning of the independent director guidelines of The Nasdaq Stock Market. We believe that the composition of our Audit Committee meets the requirements for independence under, and the functioning of our Audit Committee complies with, all applicable requirements of The Nasdaq Stock Market and SEC rules and regulations. In addition, our Board of Directors has determined that Mr. Soni meets the financial literacy requirements under the rules of The Nasdaq Stock Market and the SEC and that he qualifies as Audit Committee financial expert as defined under SEC rules and regulations.
Compensation Committee
Our Compensation Committee oversees our corporate compensation policies, plans and programs. Our Compensation Committee is responsible for, among other things:
•reviewing and approving, or making recommendations to our Board of Directorsdissenter’s rights with respect to the compensation ofReverse Stock Split, and we will not independently provide our chief executive officer and our other executive officers;stockholders with any such rights.
•overseeing an evaluation of our senior executives;
•overseeing and administering our cash and equity incentive plans;
•reviewing and making recommendations to our Board of Directors with respect to director compensation;
•reviewing and discussing annually with management our “Compensation Discussion and Analysis” disclosure if and to the extent then required by SEC rules; and
•preparing the Compensation Committee report required by SEC rules.Regulatory Approvals
The members of our Compensation Committee are Mr. Clark, Ms. Mahatme and Mr. Soni. Mr. Soni serves as our Compensation Committee Chair. Our Board of Directors has determined that each member of our Compensation Committee is independent within the meaning of the independent director guidelines of The NasdaqReverse Stock Market. We believe that the composition of our Compensation Committee meets the requirements for independence under, and the functioning of our Compensation Committee complies with,Split will not be consummated, if at all, applicable requirements of The Nasdaq Stock Market and SEC rules and regulations.
Nominating and Corporate Governance Committee
Our Nominating and Corporate Governance Committee oversees and assists our Board of Directors in reviewing and recommending corporate governance policies and nominees for election to our Board of Directors. Our Nominating and Corporate Governance Committee is responsible for, among other things:
•identifying individuals qualified to become members of our Board of Directors;
•recommending to our Board of Directors the persons to be nominated for election as directors and to each of our Board of Directors’ committees;
•reviewing and making recommendations to our Board of Directors with respect to our Board of Directors leadership structure;
•reviewing and making recommendations to our Board of Directors with respect to management succession planning;
•developing and recommending to our Board of Directors corporate governance principles; and
•overseeing an annual evaluation of our Board of Directors.
As of December 31, 2021 the members of our Nominating and Corporate Governance Committee are Mr. Clark, Dr. Gayko and Mr. Soni. Mr. Clark serves as our Nominating and Corporate Governance Committee Chair. Ms. Mahatme replaced Dr. Gayko on the Nominating and Corporate Governance Committee effective April 28, 2022 in connection with Dr. Gayko's agreement to join the Company as an employee. Our Board of Directors has determined that each member of our Nominating and Corporate Governance Committee is independent within the meaning of the independent director guidelines of The Nasdaq Stock Market.
Director Compensation
Employee directors are not compensated for Board of Directors services in addition to their regular employee compensation.
For 2021, the non-employee members of the Board of Directors were compensated as follows:
Cash compensation: Each non-employee member of the Board received the following cash compensation (the “Retainer Cash Payments”):
(1) an annual retainer for each member of the Board of $42,000 paid in equal quarterly installments;
(2) the members of our Audit, Compensation and Nominating and Corporate Governance Committees were eligible to receive an additional annual retainer of $6,000 for their service on each committee; and
(3) the Chairs of the Audit, Compensation and Nominating and Corporate Governance Committees were eligible to receive annual retainers of $33,000, $12,000, and $12,000, respectively.
We reimbursed our non-employee directors for all reasonable out-of-pocket expenses incurred in the performance of their duties as directors.
Equity Compensation: Each new non-employee director received a stock option grant to purchase 200,000 sharesuntil after approval of the Company’s common stock, par value $0.01, at a strike price equalstockholders is obtained. The Company is not obligated to obtain any governmental approvals or comply with any state or federal regulations prior to consummating the fair market valueReverse Stock Split other than the filing of the common stock on the grant date, which shall vest in four equal annual installments,Reverse Stock Split Amendment with the first such installment occurring on the one-year anniversarySecretary of State of the grant date. Each new non-employee director was granted a prorated annual grantState of Delaware.
Procedure for their
18Effecting the Reverse Stock Split
service inIf our stockholders approve this proposal, and the fourth quarterboard of 2021, at a strike price equaldirectors elects to effect the fair market valueReverse Stock Split, we will effect the Reverse Stock Split by filing the Reverse Stock Split Charter Amendment with the Secretary of State of the common stock onState of Delaware. The Reverse Stock Split will become effective, and the grant date, which vestedcombination of, and reduction in, full on December 31, 2021.
For 2022, each non-employee director may elect to may elect to convert all or a portion of his or her Retainer Cash Payments into a number of options (the “Retainer Option,” and such election, a “Retainer Option Election”). The number of shares subject to a Retainer Option will be equal to (i) the product of (A) the dollar value of the aggregate Retainer Cash Payments that the non-employee director elects to forego over the course of a specified period covered by a Retainer Option Election in favor of receiving a Retainer Option multiplied by (B) 2.5, divided by (ii) the fair market value of a share on the date of grant of the Retainer Option, provided that the number of our outstanding shares covered by such Retainer Option shall be roundedas a result of the Reverse Stock Split will occur automatically, at the time of the filing of the Reverse Stock Split Charter Amendment (referred to as the “Effective Time”), without any action on the part of our stockholders and without regard to the nearest whole share.date that stock certificates representing any certificated shares prior to the Reverse Stock Split are physically surrendered for new stock certificates. Beginning at the Effective Time, each certificate representing pre-Reverse Stock Split shares will be deemed for all corporate purposes to evidence ownership of post-Reverse Stock Split shares. The Retainer Options will vest in four equal quarterly installments on March 31, June 30, September 30text of the Reverse Stock Split Charter Amendment is subject to modification to include such changes as may be required by the office of the Secretary of State of the State of Delaware and December 31 following election.
as the Board deems necessary and advisable to effect the Reverse Stock Split.
The following table sets forth information concerning compensation paid or earned for services rendered to usboard of directors reserves the right, notwithstanding stockholder approval and without further action by the non-employee members of our Board of Directors for the fiscal year ended December 31, 2021. Compensation paidstockholders, to Mr. Duggan and Dr. Zanganeh is included in the section entitled, “Executive Compensation” and excluded from the table below:
| | | | | | | | | | | |
| Name | Fees earned or paid in cash ($) | Option Awards ($)(1) | Total ($) |
| Kenneth A. Clark | 14,384 | 1,037,438 | 1,051,822 |
Rainer Erdtmann(2) | 50,766 | 183,250 | 234,016 |
| Urte Gayko | 7,759 | 1,130,387 | 1,138,146 |
| Ujwala Mahatme | 49,414 | 183,250 | 232,664 |
| Manmeet S. Soni | 93,000 | 183,250 | 276,250 |
_______________
(1) Amounts shown represent the aggregate grant date fair value of the option awards computed in accordance with FASB ASC Topic 718. These amounts doelect not correspond to the actual value that will be realized by our directors. The assumptions used in the valuation of these awards are consistentproceed with the valuation methodologies specified in the notes to our financial statements.
(2) Mr. Erdtmann served as director until October 2021 and the option awards reflected
above were cancelled pursuant to the terms of the grant agreement.
The aggregate number of shares subject to stock options outstanding and exercisable at December 31, 2021 for each non-employee director is as follows:
| | | | | | | | |
| Name | Aggregate Number of Stock Options Outstanding as of December 31, 2021 | Aggregate Number of Stock Options Exercisable as of December 31, 2021 |
| Kenneth A. Clark | 206,250 | 6,250 |
| Urte Gayko | 204,041 | 4,041 |
| Ujwala Mahatme | 238,340 | 88,340 |
| Manmeet S. Soni | 252,273 | 152,273 |
PROPOSAL 1: ELECTION OF DIRECTORS
Our Board of Directors has nominated Robert W. Duggan, Mahkam Zanganeh, Kenneth A. Clark, Urte Gayko, Ujwala Mahatme and Manmeet S. Soni for election at the Annual Meeting to terms expiring at the 2022 annual meeting of stockholders. Please refer to “Board of Directors and Committees of the Board” section above for the nominees’ biographies.
The six nominees receiving the highest number of votes will be elected at the Annual Meeting. In the event a nominee is unable or declines to serve as a director, the proxies will be voted at the Annual Meeting for any nominee who may be designated by the Board of Directors to fill the vacancy. As of the date of this Proxy Statement, the Board of Directors is not aware of any nominee who is unable or will decline to serve as a director.
Summary information regarding our nominees is set forth below.
| | | | | | | | | | | |
| Name | Age | Position | Director
Since |
| Robert W. Duggan | 78 | Chief Executive Officer & Chairman of the Board of Directors of Summit Therapeutics Inc.; Chief Executive Officer of Duggan Investments, Inc. | 2019 |
| Mahkam Zanganeh | 51 | Chief Operations Officer & Director of Summit Therapeutics Inc.; Founder and Chief Executive Officer of Maky Zanganeh and Associates | 2020 |
| Kenneth A. Clark | 63 | Member of Wilson Sonsini Goodrich & Rosati, P.C. | 2021 |
| Urte Gayko | 51 | Head of Regulatory Affairs, Quality Assurance, and Safety & Director of Summit Therapeutics Inc. | 2021 |
| Ujwala Mahatme | 57 | Founder and Managing Partner of Mahatme Bitterman PLLC | 2020 |
| Manmeet S. Soni | 44 | President, Chief Operating Officer & Chief Financial Officer of Reata Pharmaceuticals, Inc. | 2019 |
There is no family relationship among any of the nominees, directors and/or any of our executive officers, however, Mr. Duggan and Dr. Zanganeh have a personal relationship with each other. Our executive officers serve at the discretion of the Board of Directors. Further information about our directors, is provided in the “Board of Directors and Committees of the Board” section above. Shares of common stock represented by executed, but unmarked, proxies will be voted in favor of the election of all six nominees; provided that,Reverse Stock Split if, you hold your shares of our common stock through a broker-dealer, bank nominee, custodian or other securities intermediary, the intermediary will not vote those shares for the nominees unless you give the intermediary specific voting instructions on a timely basis directing the intermediary to vote in such manner.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
“FOR”
ALL SIX NOMINEES TO SERVE AS OUR DIRECTORS
PROPOSAL 2: RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Our audit committee has appointed PricewaterhouseCoopers LLP, an independent registered public accounting firm, to audit the financial statements of the Company for the fiscal year ending December 31, 2022 and recommends that stockholders vote in favor of the ratification of such appointment. PricewaterhouseCoopers LLP was our independent registered public accounting firm for the fiscal year ended December 31, 2021.
Stockholder ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm is not required by our Bylaws or otherwise. The Board of Directors, however, is submitting the appointment of PricewaterhouseCoopers LLP to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the appointment, the Audit Committee and the Board of Directors will reconsider whether or not to retain the firm. Even if the appointment is ratified, the Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time duringprior to filing the year if itReverse Stock Spit Charter Amendment, the Board, in its sole discretion, determines that such a change would beit is no longer in the best interests of the Company and its stockholders.stockholders to proceed with the Reverse Stock Split. By voting in favor of the Reverse Stock Split, you are also expressly authorizing the Board to delay or abandon the Reverse Stock split. Stockholders should not destroy any stock certificate(s) and should not submit any certificate(s) until they receive a letter of transmittal from our transfer agent.
PricewaterhouseCoopers LLP representativesCertain Material U.S Federal Income Tax Consequences of the Reverse Stock Split
The following is a summary of certain material United States federal income tax consequences of the Reverse Stock Split to our stockholders. This summary does not purport to be a complete discussion of all of the possible federal income tax consequences of the Reverse Stock Split and is included for general information only. Further, it does not address any state, local or foreign income or other tax consequences. Also, it does not address the tax consequences to stockholders that are expectedsubject to attendspecial tax rules, including but not limited to banks, insurance companies, regulated investment companies, personal holding companies, foreign entities, nonresident alien individuals, broker-dealers, traders, and tax-exempt entities. Other stockholders also may be subject to special tax rules, including but not limited to: stockholders who received common stock as compensation for services or pursuant to the Annual Meeting virtually. Theyexercise of an employee stock option, or stockholders who have held, or will have an opportunity to makehold, stock as part of a statement if they desire to do sostraddle, hedging or conversion transaction for federal income tax purposes. This summary also assumes that you are a United States holder (defined below) who has held, and will hold, shares of common stock as a “capital asset,” as defined in the Internal Revenue Code of 1986, as amended (the “Code”), generally, property held for investment. Finally, the following discussion does not address the tax consequences of transactions occurring prior to or after the Reverse Stock Split (whether or not such transactions are in connection with the Reverse Stock Split), including, without limitation, the exercise of options or rights to purchase common stock in anticipation of the Reverse Stock Split or otherwise.
The tax treatment of a stockholder may vary depending upon the particular facts and circumstances of such stockholder. You should consult with your own tax advisor with respect to your tax consequences of the Reverse Stock Split. As used herein, the term “United States holder” means a stockholder that is, for federal income tax purposes: a citizen or resident of the United States; a corporation or other entity taxed as a corporation created or organized in or under the laws of the United States or any state, including the District of Columbia; an estate the
income of which is subject to federal income tax regardless of its source; or a trust that (i) is subject to the primary supervision of a U.S. court and the control of one of more U.S. persons or (ii) has a valid election in effect under applicable U.S. Treasury regulations to be availabletreated as a U.S. person.
The following discussion is based on the Code, applicable Treasury Regulations, judicial authority and administrative rulings and practice, all as of the date hereof. The Internal Revenue Service could adopt a contrary position. In addition, future legislative, judicial or administrative changes or interpretations could adversely affect the accuracy of the statements and conclusions set forth herein. Any such changes or interpretations could be applied retroactively and could affect the tax consequences described herein. No ruling from the Internal Revenue Service or opinion of counsel has been obtained in connection with the Reverse Stock Split.
No gain or loss should be recognized by a stockholder upon such stockholder’s exchange of pre-Reverse Stock Split shares of common stock for post-Reverse Stock Split shares of common stock pursuant to respondthe Reverse Stock Split. The aggregate tax basis of the post-Reverse Stock Split shares received in the Reverse Stock Split (including any whole share received in exchange for a fractional share) will be the same as the stockholder’s aggregate tax basis in the pre-Reverse Stock Split shares exchanged therefore. The stockholder’s holding period for the post-Reverse Stock Split shares will include the period during which the stockholder held the pre-Reverse Stock Split shares surrendered in the Reverse Stock Split.
THE PRECEDING DISCUSSION IS INTENDED ONLY AS A SUMMARY OF CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT AND DOES NOT PURPORT TO BE A COMPLETE ANALYSIS OR DISCUSSION OF ALL POTENTIAL TAX EFFECTS RELEVANT THERETO. YOU ARE STRONGLY ADVISED TO CONSULT YOUR OWN TAX ADVISORS AS TO THE PARTICULAR FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT IN LIGHT OF YOUR SPECIFIC CIRCUMSTANCES.
Accounting Matters
The par value of the common stock will remain unchanged at $0.01 per share after the Reverse Stock Split. As a result, our stated capital, which consists of the par value per share of the common stock multiplied by the aggregate number of shares of the common stock issued and outstanding, will be reduced proportionately at the Effective Time of the Reverse Stock Split. Correspondingly, our additional paid-in capital, which consists of the difference between our stated capital and the aggregate amount paid to appropriate stockholder questions.us upon the issuance of all currently outstanding shares of common stock, will be increased by a number equal to the decrease in stated capital. Further, net loss per share, book value per share and other per share amounts will be increased as a result of the Reverse Stock Split because there will be fewer shares of common stock outstanding.
Vote Required
RatificationIn accordance with Delaware law, approval and adoption of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the year ending December 31, 2022this proposal requires the affirmative “FOR” vote of at least a majority of theour issued and outstanding shares present, represented, and entitled to vote oneither in person or by proxy at the proposal. You may vote “FOR,” “AGAINST,” or “ABSTAIN” on this proposal. Abstentions are deemed to be votes castmeeting. Accordingly, abstentions and broker non-votes will have the same effect as a vote against the proposal. Broker non-votes are not deemed to be votes cast, are not included in the tabulation of voting results on this proposal, and will not affect the outcome of voting on this proposal. Shares of common stock represented by executed, but unmarked,valid proxies and not revoked will be voted at the meeting in favoraccordance with the instructions given. If no voting instructions are given, such shares will be voted “FOR” this proposal.
The Board of Directors unanimously recommends a vote “FOR” the Approval of the approval of the proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
“FOR”
THE RATIFICATION OF THE APPOINTMENT OF
PRICEWATERHOUSECOOPERS LLPCharter Amendment to Effect The Reverse Stock Split.
AUDITOR SERVICES AND FEES
Policy on Audit Committee’s Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm
The Audit Committee reviews and pre-approves all audit and permissible non-audit services provided by the independent registered public accounting firm. These services may include audit services, audit-related services and tax services, as well as specifically designated non-audit services which, in the opinion of the Audit Committee, will not impair the independence of the independent registered public accounting firm. Pre-approval generally is provided for up to one year, and any pre-approval is detailed as to the particular service or category of services and generally is subject to a specific budget. The independent registered public accounting firm and the Company’s management are required to periodically report to the Audit Committee regarding the extent of services provided by the independent registered public accounting firm in accordance with this pre-approval, including the fees for the services performed to date. In addition, the Audit Committee also may pre-approve particular services on a case-by-case basis, as necessary or appropriate.
Auditor Fees
The following table sets forth the approximate aggregate fees billed to the Company by PricewaterhouseCoopers LLP for the year ended December 31, 2021 and 2020, respectively (in thousands):
| | | | | | | | |
| Fee Category | Year Ended December 31, 2021 | Year Ended December 31, 2020 |
| Audit Fees | $ | 1,113 | $ | 515 |
| Audit-Related Fees | — | 629 |
| All Other Fees | 4 | 3 |
| Total | $ | 1,117 | $ | 1,147 |
Audit Fees: Audit fees for both years consisted of professional services rendered for: (i) the audit of our annual consolidated financial statements, (ii) statutory audits, (iii) the review of our consolidated financial statements included in our quarterly reports on Form 10-Q and (iv) audit services associated with other reports filed with the Securities and Exchange Commission.
Audit-Related Fees: There were no audit-related fees for the year ended December 31, 2021. Audit-related fees for the year ended December 31, 2020 were for professional services associated with the Redomiciliation Transaction.
All Other Fees: All other fees for the year ended December 31, 2021 and 2020, respectively, related to a subscription to a global research and disclosure software platform.
The Audit Committee has concluded that the provision of the non-audit services listed above was compatible with maintaining the independence of PricewaterhouseCoopers LLP.
PROPOSAL 3: ADVISORY VOTE TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS
We are required by Section 14A of the Exchange Act to provide our stockholders with an advisory vote to approve the compensation of our named executive officers. This proposal, commonly known as “Say-on-Pay,” asks our stockholders to vote, on a non-binding, advisory basis, on a resolution approving the compensation of our named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the “Executive Compensation” sections of this proxy statement.
We have established comprehensive compensation programs for our executive officers, including our named executive officers, and the “Executive Compensation” section of this proxy statement discloses information regarding the compensation of our named executive officers. Stockholders should reference and consider the information in such section when evaluating our approach to compensating our named executive officers.
Our Board of Directors and the Compensation Committee of our Board of Directors monitor executive compensation programs and adopt changes, when appropriate, to our compensation programs to reflect the competitive market in which we compete for talent, as well as general economic, regulatory and legislative developments affecting executive compensation.
The objectives of our executive compensation programs are to attract and retain the talented individuals we need to achieve long-term success and to motivate them to achieve goals designed to enhance long-term stockholder value. With these objectives in mind, the Compensation Committee has structured executive compensation in accordance with the following considerations (among others):
•Targeting total cash compensation, which is comprised of base salary plus annual incentive (cash bonus), at market levels for comparable companies.
•Linking the vesting of most option awards to performance standards established by our Compensation Committee as described in the “Executive Compensation” section of this proxy statement.
•Limiting the perquisites that we make available to our named executive officers, who are entitled to few benefits that are not otherwise available to our employees. The aggregate amount of such perquisites for each continuing named executive officer in any year reflected under “Executive Compensation – Summary Compensation Table” has not exceeded $10,000.
The Compensation Committee will continue to emphasize compensation arrangements that align the financial interests of our executive officers with the interests of our stockholders. Please refer to the “Executive Compensation” sections of this proxy statement for a discussion of our Company’s executive compensation practices and philosophy and the actual compensation provided to our named executive officers.
The vote on the compensation of our named executive officers is advisory and not binding on us, our Board of Directors or the Compensation Committee. The affirmative vote of the holders of a majority of the shares having voting power present in person or represented by proxy at the Annual Meeting is required to approve, on a non-binding, advisory basis, the compensation of our named executive officers as disclosed in this proxy statement. Consequently, broker non-votes will have no effect on approval of the resolution, but abstentions will act as a vote against approval of the resolution. Shares of common stock represented by executed, but unmarked, proxies will be voted in favor of the approval of the compensation of our named executive officers as disclosed in this proxy statement; provided that, if you hold your shares of our common stock through a broker-dealer, bank nominee, custodian or other securities
intermediary, the intermediary will not vote those shares for the compensation of our named executive officers unless you give the intermediary specific voting instructions on a timely basis directing the intermediary to vote in such manner. Although the outcome of this advisory vote on the compensation of our named executive officers is non-binding, our Board of Directors and the Compensation Committee will review and consider the outcome of this vote when making future compensation decisions for our named executive officers.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE APPROVAL OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS AS DISCLOSED IN THIS PROXY STATEMENT.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Policies and Procedures for Related Party Transactions
Our Board of Directors has adopted written policies and procedures for the review of any transaction, arrangement or relationship in which the Company is a participant, the amount involved exceeds $120,000, and one of our executive officers, directors, director nominees or 5% stockholders (or their immediate family members), each of whom we refer to as a “related person,” has a direct or indirect material interest. If a related person proposes to enter into such a transaction, arrangement or relationship, which we refer to as a “related person transaction,” the related person must report the proposed related person transaction to our Chief Executive Officer or principal financial officer. The policy calls for the proposed related person transaction to be reviewed and, if deemed appropriate, approved by our Audit Committee. Whenever practicable, the reporting, review and approval will occur prior to entry into the transaction. If advance review and approval is not practicable, the Audit Committee will review, and, in its discretion, may ratify the related person transaction. The policy also permits the Chair of the Audit Committee to review and, if deemed appropriate, approve proposed related person transactions that arise between Audit Committee meetings, subject to ratification by the Audit Committee at its next meeting. Any related person transactions that are ongoing in nature will be reviewed annually.
A related person transaction reviewed under the policy will be considered approved or ratified if it is authorized by the Audit Committee after full disclosure of the related person’s interest in the transaction. As appropriate for the circumstances, the Audit Committee will review and consider:
•the related person’s interest in the related person transaction;
•the approximate dollar value of the amount involved in the related person transaction;
•the approximate dollar value of the amount of the related person’s interest in the transaction without regard to the amount of any profit or loss;
•whether the transaction was undertaken in the ordinary course of our business;
•whether the terms of the transaction are no less favorable to us than terms that could have been reached with an unrelated third party;
•the purpose of, and the potential benefits to us of, the transaction; and
•any other information regarding the related person transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction.
The Audit Committee may approve or ratify the transaction only if the Audit Committee determines that, under all of the circumstances, the transaction is in the best interests of the Company and its stockholders. The Audit Committee may impose any conditions on the related person transaction that it deems appropriate.
In addition to the transactions that are excluded by the instructions to the SEC’s related person transaction disclosure rule, our Board of Directors has determined that the following transactions do not create a material direct or indirect interest on behalf of related persons and, therefore, are presumed not to be related person transactions for purposes of this policy:
•interests arising solely from the related person’s position as an executive officer of another entity (whether or not the person is also a director of such entity), that is a participant in the transaction, where (a) the related person and all other related persons own in the aggregate less than a 10% equity interest in such entity, (b) the related person and his or her immediate family members are not involved in the negotiation of the terms of the transaction and do not receive any special benefits as a result of the transaction, and (c) the amount involved in the transaction equals less than the greater of $200,000 or 5% of the annual gross revenues of the entity receiving payment under the transaction; and
•a transaction that is specifically contemplated by provisions of our charter or Bylaws.
The policy provides that transactions involving compensation of executive officers shall be reviewed and approved by our Compensation Committee in the manner specified in its charter.
Related Party Transactions
In addition to the compensation arrangements, including employment, termination of employment and change in control arrangements discussed above in the sections titled “Director Compensation” and “Executive Compensation,” we describe below transactions and series of similar transactions, since the beginning of our last fiscal year, to which we were a party or will be a party, in which:
•the amounts involved exceeded or will exceed $120,000; and
•any of our directors, nominees for director, executive officers or holders of more than 5% of our outstanding capital stock, or any immediate family member of, or person sharing the household with, any of these individuals or entities, had or will have a direct or indirect material interest.
Transactions with Robert W. Duggan
On March 10, 2022, the Company entered into a Note Purchase Agreement (the "2022 Note"), with Mr. Duggan, pursuant to which Mr. Duggan loaned the Company $25.0 million in exchange for the issuance by the Company of an unsecured promissory note in the amount of $25.0 million. The 2022 Note accrued interest at a rate per annum equal to the prime rate as reported in the Wall Street Journal, which was 3.25% as of the effective date. The 2022 Note becomes due upon the earlier of (i) the consummation of a registered public offering with net proceeds of no less than $25.0 million or (ii) 18 months from the date of issuance of the 2022 Note.
On May 12, 2021, the Company closed its rights offering, which was fully subscribed. Aggregate gross proceeds received from the rights offering of $75.0 million from the sale of 14,312,976 shares of the Company's common stock, of which 11,365,921 shares were purchased by Mr. Duggan.
On April 20, 2021, the Company entered into a Note Purchase Agreement (the “Purchase Agreement”) with Mr. Duggan, pursuant to which Mr. Duggan loaned the Company $55.0 million in exchange for the issuance by the Company of an unsecured promissory note in the amount of $55.0 million (the “Note”). The Note accrues interest at a rate per annum equal to 150% of the applicable 10 Year US Treasury rate, as adjusted monthly (initially estimated to be approximately 2.4%). The Company may prepay any portion of the Note at its option without penalty. The Note will mature and become due upon the earlier of (i) the consummation of a registered public offering with net proceeds of no less than $55.0 million or (ii) 13 months from the date of issuance of the Note. The Note was repaid in connection with the consummation of the May 12, 2021 rights offering.
On March 24, 2021, Mr. Duggan entered into a note purchase agreement pursuant to which he loaned the Company $55.0 million in exchange for the issuance by the Company of an unsecured promissory note in the amount of $55.0 million. The note accrues interest at a rate per annum equal to 150% of the applicable 10 Year US Treasury rate, as adjusted monthly. The rate is initially estimated to be approximately 2.4%. The Company may prepay any portion of the note at its option without penalty. The note will mature and become due upon the earlier of (i) the consummation of a registered public offering with net proceeds of no less than $55.0 million, or (ii) 13 months from the date of issuance of the note. On April 20, 2021 the note purchase agreement and note were rescinded and the note was repaid without interest or penalty pursuant to the terms of a rescission agreement by and between the Company and Mr. Duggan. The rescission agreement was effective and the repayment of the principal amount had been made prior to the entry into the Purchase Agreement described above.
On November 6, 2020, the Company completed a private placement of its common stock and received gross proceeds of $50.0 million from the issuance and sale of 14,970,060 shares of common stock at a price of $3.34 per share, of which 14,071,856 shares of common stock were subscribed by Mr. Duggan.
Transactions with Dr. Mahkam Zanganeh
On May 12, 2021, 389,977 shares were purchased by Dr. Zanganeh in connection with the May 12, 2021 rights offering.
On March 26, 2021, the Company entered into a Sublease with Dr. Zanganeh and Associates, Inc. ("MZA") consisting of 4,500 square feet of space at 2882 Sand Hill Road, Menlo Park, CA (the “Sublease”). The Sublease runs until September 2022. The rent payable under the terms of the Sublease is equivalent to the proportionate share of the rent payable by
MZA to the third party landlord, based on the square footage of office space sublet by the Company, and no mark-up has been applied. During the year ended December 31, 2021, payments of $555,750 were made pursuant to the sublease.
On November 6, 2020, the Company completed a private placement with the Mahkam Zanganeh Revocable Trust which subscribed for an aggregate of 149,701 shares of common stock, par value $0.01 per share at a price of $3.34 per common share of stock. Dr. Zanganeh was appointed to the Board of Directors on November 11, 2020 and as Chief Operations Officer on November 22, 2020. As trustee of the Mahkam Zanganeh Revocable Trust, Dr. Zanganeh may be deemed to beneficially own the securities of the Company held by the Mahkam Zanganeh Revocable Trust.
In 2020, the Company had in place a consultancy agreement with Dr. Zanganeh and Associates, Inc. (“MZA”) to provide support for clinical operation activities related to the the global Phase III clinical program. Dr. Zanganeh is the sole owner of MZA, and Dr. Elaine Stracker, who served for a period during fiscal year 2020 as a director of the Company and as the Company’s Interim Chief Operating Officer, was at the time the General Counsel and Senior Vice President for Corporate Development at MZA. The fees for such services under the consultancy agreement with MZA were $75,000 per month. In addition to such monthly fee, MZA was granted warrants over 3,358,732 shares of common stock with an exercise price of $1.44 per share, vesting on a quarterly basis over three years from the date of grant, subject to MZA’s provision of consultancy services to the Company during such period. During the period of MZA's engagement, $470,000 of consultancy fees were incurred by the Company and a warrant expense of $511,872 was recognized. The consultancy agreement with MZA was terminated by mutual agreement on June 30, 2020. The warrants granted to MZA were subsequently assigned to Dr. Zanganeh and Dr. Stracker. Dr. Zanganeh has vested warrants to purchase 489,815 shares of common stock which can be exercised through June 30, 2025.
Indemnification Agreements
Our certificate of incorporation provides that we will indemnify our directors and officers to the fullest extent permitted by Delaware law. In addition, we have entered into indemnification agreements with all of our directors and named executive officers. These indemnification agreements may require us, among other things, to indemnify each such director or executive officer for some expenses, including attorneys’ fees, judgments, fines, and settlement amounts incurred by him or her in any action or proceeding arising out of his or her service as one of our directors or executive officers.
Employment Arrangements
We have entered into employment agreements with certain of our executive officers. For more information regarding the agreements with our named executive officers, see “Executive Compensation.”
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of April 26,December 5, 2022 with respect to the beneficial ownership of our common stock by (i) each person we believe beneficially holds more than 5% of the outstanding shares of our common stock based solely on our review of SEC filings or information provided to us by such person; (ii) each director and nominee; (iii) each named executive officer listed in the table entitled, “Summary Compensation Table” under the section entitled, “Executive Compensation”; and (iv)(iii) all directors and executive officers as a group. As of April 26,December 5, 2022, 98,122,356[201,321,175] shares of our common stock were issued and outstanding. Unless otherwise indicated, all persons named as beneficial owners of our common stock have sole voting power and sole investment power with respect to the shares indicated as beneficially owned. Unless otherwise noted below, the address of each stockholder listed on the table is c/o Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 02142.2882 Sand Hill Road, Suite 106, Menlo Park, California 94025.
| | | | | | | | | | | | | | |
| Name and address of beneficial owner | Number of Shares Owned (1) | Right to Acquire Shares (2) | Total Beneficial Ownership | Percent of Class (3) |
| 5% Stockholders: | | | | |
Robert W. Duggan (4) | 67,662,454 | 3,985,055 | 71,647,509 | 70.2% |
Mahkam Zanganeh(5) | 4,747,860 | 1,774,500 | 6,522,360 | 6.5% |
Polar Capital Holdings Plc(6) | 6,109,566 | 186,147 | 6,295,713 | 6.4% |
| | | | |
| Named executive officers and directors: | | | | |
| Robert W. Duggan | 67,662,454 | 3,985,055 | 71,647,509 | 70.2% |
| Mahkam Zanganeh | 4,747,860 | 1,774,500 | 6,522,360 | 6.5% |
| Kenneth A. Clark | – | 27,128 | 27,128 | * |
| Urte Gayko | – | 20,929 | 20,929 | * |
| Ujwala Mahatme | – | 106,558 | 106,558 | * |
| Manmeet S. Soni | – | 179,135 | 179,135 | * |
| | | | |
| All named executive officers and directors as a group (6 people) | 72,410,314 | 6,093,305 | 78,503,619 | |
| | | | | | | | | | | | | | |
| Name and address of beneficial owner | Number of Shares Owned (1) | Right to Acquire Shares (2) | Total Beneficial Ownership | Percent of Class (3) |
| 5% Stockholders: | | | | |
Robert W. Duggan (4) | [162,532,792] | [3,985,055] | [166,517,847] | [81.1]% |
Mahkam Zanganeh (5) | [10,556,992] | [2,424,500] | [12,981,492] | [6.4]% |
Named executive officers and directors: | | | | |
Robert W. Duggan(4) | [162,532,792] | [3,985,055] | [166,517,847] | [81.1]% |
Mahkam Zanganeh(5) | [10,556,992] | [2,424,500] | [12,981,492] | [6.4]% |
| Kenneth Clark | – | [139,760] | [139,760] | * |
| Ankur Dhingra | [76,253] | – | [76.253] | * |
| Ujwala Mahatme | – | [211,212] | [211,212] | * |
| Manmeet S. Soni | – | [309,719] | [309,719] | * |
| Robert F. Booth | – | [6,250] | [6,250] | * |
| Alessandra Cesano | – | [4,166] | [4,166] | * |
| | | | |
| All executive officers and directors as a group (8 people) | [173,166,037] | [7,080,662] | [180,246,699] | [87.5]% |
_______________(*) Represents beneficial ownership of less than 1% of the outstanding shares of our common stock.
(1) Excludes shares that may be acquired through the exercise of outstanding stock options or other equity awards.
(2) Represents shares issuable within 60 days after April 26,December 5, 2022 upon exercise of exercisable options and warrants; however, unless otherwise indicated, these shares do not include any equity awards awarded after April 26,December 5, 2022.
(3) For purposes of calculating the Percent of Class, shares that the person or entity had a right to acquire within 60 days after April 26,December 5, 2022 are deemed to be outstanding when calculating the Percent of Class of such person or entity.
(4) This information is based upon a Schedule 13D/A filed by Mr. Duggan with the Securities and Exchange Commission on May 14, 2021.August 18, 2022 and a Form 4 filed on August 18, 2022. The 71,647,509166,517,847 shares of common stock beneficially owned by Mr. Duggan includes (i) 67,662,454162,532,792 shares of
common stock and (ii) warrants to purchase 3,985,055 shares of common stock, which are exercisable until December 24, 2029.
(5) This information is based upon a Schedule 13D/A filed by Dr. Zanganeh with the Securities and Exchange Commission on November 25, 2020 and information known to the Company. The 6,522,36012,981,492 shares of common stock beneficially owned by Dr. Zanganeh includes (i) 4,747,86010,556,992 shares of common stock, (ii) the exercise of warrants to purchase 1,121,177 shares of common stock, and (iii) options to purchase 653,3231,303,323 shares of common stock. The warrants to purchase 631,362 shares of common stock (exercisable until December 24, 2029) are held by the Mahkam Zanganeh Revocable Trust and the Shaun Zanganeh Irrevocable Trust. The remaining warrants to purchase 489,815 shares of common stock (exercisable until June 30, 2025) are held individually by Mahkam Zanganeh. The options to purchase 653,3231,303,323 shares of common stock are held individually by Dr. Zanganeh.
(6) This information is based upon a Schedule 13G/A filed by Polar Capital Holdings Plc with the Securities and Exchange Commission on February 14, 2022. The 6,295,713 shares of common stock beneficially owned by Polar Capital Holdings Plc includes (i) 6,109,566 shares of common stock and (ii) warrants to purchase 186,147 shares of common stock which are exercisable until December 24, 2029.
EXECUTIVE OFFICERS
Biographical data for our current executive officers, including their ages as of December 31, 2021 is set forth below, except Mr. Duggan’s and Dr. Zanganeh’s biography, each of which are included under the heading, “Board of Directors and Committees of the Board” above.
Executive Officers
Jeffrey Maranian, age 40, served as the Company’s Corporate Controller since November 2020 and as the Company’s Principal Accounting Officer from July 2021 until January 2022. Mr. Maranian joined the Company from Acacia Communications Inc., where he held roles of increasing responsibility over a six-year period, including Controller, until it was acquired by Cisco for $4.5 billion. Prior to that, he spent the first 11 years of his career in audit and accounting advisory roles, including three years at CFGI, a financial consulting firm, where he helped companies transform their finance functions, solve complex technical accounting matters, and enter public markets. Mr. Maranian spent the first eight years of his career at PricewaterhouseCoopers, primarily serving clients in the life sciences sector. He holds Bachelor and Master of Science degrees in Accountancy from Bentley University and is a Certified Public Accountant in Massachusetts. On January 7, 2022, Mr. Maranian resigned from his position as VP Corporate Controller and Principal Accounting Officer of the Company, effective as of close of business on January 21, 2022.
EXECUTIVE COMPENSATION
Compensation Committee Report
The information contained in the following report of the Compensation Committee shall not be deemed to be “soliciting material” or to otherwise be considered “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act except to the extent that the Company specifically incorporates it by reference into such filing.
The Compensation Committee has reviewed and discussed the following "Executive Compensation" section of this Proxy Statement with management. Based on this review and discussion, the Compensation Committee recommended to our Board of Directors that such information be included in this Proxy Statement.STOCKHOLDER PROPOSALS
MembersYou may submit proper proposals, including recommendations of director candidates, for inclusion in the Compensation Committee
Manmeet S. Soni (Chair)
Kenneth A. Clark
Ujwala Mahatmeproxy materials or meeting agenda for future stockholder meetings by following certain procedures outlined in this proxy statement.
Executive Compensation
The following is a discussion and analysis of compensation arrangements of our named executive officers (NEOs). This discussion contains forward looking statements that are based on our current plans, considerations, expectations and determinations regarding future compensation programs. Actual compensation programs that we adopt may differ materially from currently planned programs as summarized in this discussion. As a smaller reporting company, we are not required to include a Compensation Discussion and Analysis section and have elected to comply with the scaled disclosure requirements applicable to smaller reporting companies.
We seek to ensure that the total compensation paid to our executive officers is reasonable and competitive. Compensation of our executives is structured around the achievement of individual performance and near-term corporate targets as well as long-term business objectives.
Our NEOs for fiscal year 2021 were as follows, who are comprised of (1) our principal executive officer in fiscal year 2021, (2) our next two most highly compensated executive officers who were serving as executive officers as of December 31, 2021, and (3) one former executive officer:
•Robert W. Duggan, our Chief Executive Officer and Executive Chairman;
•Mahkam Zanganeh, our Chief Operations Officer and a member of our Board of Directors;
•Jeffrey Maranian, our Principal Accounting Officer as of December 31, 2021;PROXY SOLICITATION
•David Powell,We are making this solicitation of proxies on behalf of the Board, and we will bear the cost of soliciting proxies. Proxies may be solicited through the mail and through telephonic or telegraphic communications to, or by meetings with, stockholders or their representatives by directors, officers and other of our former Chief Scientific Officeremployees who will receive no additional compensation therefore. We request persons such as brokers, nominees and fiduciaries holding stock in their names for others, or holding stock for others who have the right to give voting instructions, to forward proxy material to their principals and to request authority for the execution of the proxy. We will reimburse such persons for their reasonable expenses.
31STOCKHOLDERS SHARING THE SAME ADDRESS
Summary Compensation Table
The following table provides information regarding the compensation of our principal executive officer, our next two most highly compensated executive officers, who were serving as executive officers as of December 31, 2021, and a former executive officer.
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Option Awards(1) ($) | All Other Compensation(2) ($) | Total ($) |
| | | | | | |
Robert W. Duggan, Chief Executive Officer and Executive Chairman (3) | 2021 | — | — | — | — | — |
| 2020 | — | — | — | — | — |
| | | | | | |
Mahkam Zanganeh, Director and Chief Operations Officer(4) | 2021 | 450,000 | 182,250 | 8,987,768 | 19,196 | 9,639,214 |
| 2020 | 49,615 | — | 476,316 | 1,381 | 527,312 |
| | | | | | | | |
Jeffrey Maranian, Principal Accounting Officer(5) | 2021 | 289,583 | — | 707,087 | 47,477 | 1,044,147 |
| | | | | | |
David Powell, Former Chief Scientific Officer(6) | 2021 | 288,495 | — | 1,242,411 | 75,792 | 1,606,698 |
| 2020 | 266,949 | 46,815 | — | 87,360 | 401,124 |
| | | | | | |
_______________
(1) Amounts shown represent the aggregate grant date fair value of the restricted stock units and option awards computed in accordance with FASB ASC Topic 718. These amounts do not correspond to the actual value that will be realized by our named executive officers. The assumptions used in the valuation of these awards are consistent with the valuation methodologies specified in the notes to our financial statements. During the fiscal year ended December 31, 2020, certain named executive officers of the Company were granted performance-based options by the Company’s Compensation Committee, however, since performance criteria had not yet been approved for certain tranches of these options, the fair value of such tranches was zero. During fiscal year ended December 31, 2021, the Compensation Committee of the Board of Directors made the determination to make certain awards originally designed to have both time-based and performance-based vesting conditions become time-based vesting awards. The following summarizes the value of the 2021 Option Awards reflected in the table above.
| | | | | | | | | | | |
| Name and Principal Position | 2020 Awards Granted Where Performance Conditions Were Deemed Eliminated in 2021 ($) | 2021 Option Awards Granted ($) | Total ($) |
| | | |
| Mahkam Zanganeh, Director and Chief Operations Officer | 8,952,069 | 35,699 | 8,987,768 |
| | | |
| Jeffrey Maranian, Principal Accounting Officer | 412,259 | 294,828 | 707,087 |
| | | |
| David Powell, Former Chief Scientific Officer | 1,242,411 | — | 1,242,411 |
| | | |
(2) The amounts paid for all other compensation consisted of the following:
| | | | | | | | | | | | | | | | | |
| Name and Principal Position | Year | Health, Life and Disability Benefits ($) | 401(k) Match/Pension Scheme ($) | Director Fees | Total ($) |
| | | | | |
| Mahkam Zanganeh, Director and Chief Operations Officer | 2021 | 1,796 | 17,400 | — | 19,196 |
| 2020 | — | — | 1,381 | 1,381 |
| | | | | |
| Jeffrey Maranian, Principal Accounting Officer | 2021 | 30,102 | 17,375 | — | 47,477 |
| | | | | |
| David Powell, Former Chief Scientific Officer | 2021 | 52,808 | 22,984 | — | 75,792 |
| 2020 | 66,004 | 21,356 | — | 87,360 |
| | | | | |
(3) Mr. Duggan has declined any compensation from the Company.
(4) Excludes all consideration paid to MZA for consulting services. See "Certain Relationships and Related Party Transactions" for the details of such consideration. All other compensation for the year ended December 31, 2020 consisted only of directors fees. Dr. Zanganeh served as a non-executive director for Summit from November 11, 2020 through November 22, 2020.
(5) Under applicable rules of the SEC, Mr. Maranian was not an executive officer in 2020
and therefore, his compensation is not included with respect to such year. On January 7,
2022, Mr. Maranian resigned from his position as VP Corporate Controller
and Principal Accounting Officer of the Company, effective as of close of
business on January 21, 2022.
(6) Officer was paid in pound sterling, compensation was translated into U.S. dollars using an average rate for the fiscal year.
Outstanding Equity Awards at Fiscal Year-End
The following table presents certain information concerning equity awards held by our principal executive officer, our next two most highly compensated executive officers, who were serving as executive officers as of December 31, 2021, and a former executive officer.
Outstanding Equity Awards at Fiscal Year-End
| | | | | | | | | | | | | | | | | |
| | Option Awards |
| Name | | Number of securities underlying outstanding options | Option exercise price ($/sh) | Option expiration date |
| Grant date | Exercisable | Unexercisable | | |
| Robert W. Duggan, Chief Executive Officer and Executive Chairman | — | — | — | — | — |
| | | | | |
| Mahkam Zanganeh, Director and Chief Operations Officer | 11/11/2020(1) | 50,000 | 150,000 | $ | 3.71 | 11/11/2030 |
| 11/11/2020 | 3,323 | — | $ | 3.71 | 11/11/2030 |
11/22/2020(2) | 600,000 | 1,800,000 | $ | 4.40 | 11/22/2030 |
12/15/2021(3) | — | 15,000 | $ | 4.75 | 12/15/2031 |
| | | | | |
| Jeffrey Maranian, Principal Accounting Officer | 11/22/2020(2) | 28,125 | 84,375 | | $ | 4.40 | 11/22/2030 |
11/22/2020(4) | 28,125 | 84,375 | | $ | 4.40 | 11/22/2030 |
6/16/2021(5) | — | 20,000 | $ | 6.61 | 6/16/2031 |
11/11/2021(6) | — | 50,000 | $ | 5.28 | 11/11/2031 |
12/15/2021(3) | — | 15,000 | $ | 4.75 | 12/15/2031 |
| | | | | |
| David Powell, Former Chief Scientific Officer | 7/8/2020 | 75,000 | — | $ | 3.31 | 6/1/2022 |
| | | | | |
_______________
(1) Options vest in four equal annual installments beginning November 11, 2021.
(2) Option award was originally a performance-based award. In September 2021, this award
was modified to a time-based award, which vest in four equal annual installments
beginning on November 22, 2021.
(3) Options vest in three years on December 15, 2024.
(4) Options vest in four equal annual installments beginning on November 22, 2021.
(5) Options vest in two equal annual installments beginning on June 16, 2022.
(6) Options vest in four equal annual installments beginning on November 11, 2022.
Narrative to Summary Compensation Table and Outstanding Equity Awards at Fiscal Year End
Employment Agreement with Mahkam Zanganeh
We entered into an employment agreement with Dr. Zanganeh, our Chief Operations Officer, on November 22, 2020. The employment relationship between the Company and Dr. Zanganeh is “at-will”, and the employment agreement has no specific term. Dr. Zanganeh’s current annual base salary is $450,000. Pursuant to her employment agreement, upon her appointment she received a grant of options to purchase 2,400,000 shares of our common stock, vesting in four equal annual installments, subject to the satisfaction of certain performance conditions. During fiscal year ended December 31, 2021, the Compensation Committee of the Board of Directors determined to eliminate the requirements for satisfying performance-based stock option awards and deemed all performance-based vesting requirements satisfied. Following this determination, the option awards are subject only to previous existing time-based vesting conditions. Dr. Zanganeh was eligible in 2021 for an annual target bonus equal to 45% of her annual base salary, subject to achievement of performance objectives. Dr. Zanganeh was paid a discretionary cash bonus of $182,250 relating to 2021 and this bonus was paid in March of 2022.
Dr. Zanganeh is eligible to participate in employee benefit plans maintained from time to time by us of general applicability to other senior executives. During her term of service as an executive officer, Dr. Zanganeh will not receive compensation that would otherwise be owed to her in her capacity as a member of our Board of Directors.
Jeffrey Maranian Compensation
Mr. Maranian was an "at-will" employee until his resignation effective January 21, 2022. Prior to that time, the employment offer letter provided to Mr. Maranian had no specific term. Mr. Maranian's annual compensation when he joined the Company in November 2021 was $275,000 and was subsequently increased to $300,000 when he became Principal Accounting Officer in July 2021. Mr. Maranian received a $25,000 sign-on bonus in 2021. Mr. Maranian also received a grant of options to purchase 225,000 shares of our common stock, half of which were subject to the satisfaction of certain performance conditions, vesting in four equal annual installments and half of which were subject to time-based vesting conditions over four years. During fiscal year ended December 31, 2021, the Compensation Committee of the Board of Directors made the determination to make all awards with performance-based vesting conditions time-based, and eliminated the requirements for satisfying performance conditions. Mr. Maranian is eligible to participate in employee benefits plans maintained from time to time by us of general applicability to Company employees.
Mr. Maranian was eligible in 2021 for an annual target bonus of up to 30% of his annual base salary. On January 7, 2022, Mr. Maranian resigned from his position as VP Corporate Controller and Principal Accounting Officer of the Company, effective as of close of business on January 21, 2022 and as such, his 2021 bonus was not approved or paid in 2022.
Equity Compensation Plan Information
The following table presents information about our equity compensation plans as of December 31, 2021:
| | | | | | | | | | | |
| Plan category | Number of securities to be issued upon exercise of outstanding options, warrants and rights (a) | Weighted average exercise price of outstanding options, warrants and rights ($) | Number of securities remaining available for future issuance under equity compensation plans excluding securities reflected in column (a) |
Equity compensation plans approved by security holders (1) | 19,058,906 | $4.45 | 4,119,451 |
Equity compensation plans not approved by security holders (2) | 559,787 | $1.44 | ___ |
_______________
(1) Includes the following plans: the 2020 Stock Incentive Plan (the “Stock Incentive Plan”), the 2020 Employee Stock Purchase Plan (the “ESPP”), the 2016 Long Term Incentive Plan (the “LTIP”) and the 2005 EMI Scheme Rules (the “EMI Plan” and together with the LTIP, the “Legacy Plans”). Our Stock Incentive Plan provides that the number of shares available for issuance thereunder will be increased on the first day of each fiscal year beginning with the 2021 fiscal year in an amount equal to the least of (i) 6,400,000 shares, (ii) 4% of the outstanding shares of our common stock as of such date, or (iii) such number of shares as determined by our Board of Directors. On January 1, 2022, the number of shares available for issuance under the Stock Incentive Plan increased by 3,900,000 shares pursuant to these provisions. This increase is not reflected in the table above. Our ESPP provides that the number of shares available for issuance thereunder will be increased on the first day of each fiscal year beginning with the 2021 fiscal year in an amount equal to the least of (i) 1,600,000 shares, (ii) 1% of the outstanding shares of our common stock as of such date, or (iii) such number of shares as determined by our Board of Directors. On January 1, 2022, the number of shares available for issuance under the ESPP increased by 980,000 shares pursuant to these provisions. In connection with the Redomiciliation Transaction, the Company assumed Old Summit’s obligations under our Legacy Plans and replaced all equity awards granted under the Legacy Plans with equivalent equity awards for our common stock.
(2) Includes outstanding warrants granted to MZA for consultancy services provided by MZA to the Company pursuant to the Company’s consultancy agreement with MZA that was terminated by mutual agreement in June 2020.
AUDIT COMMITTEE REPORT
The following audit committee report shall not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, and shall not otherwise be deemed filed under these acts, except to the extent we specifically incorporate by reference into such filings.
Our Audit Committee is composed of “independent” directors, as determined in accordance with Nasdaq Stock Market’s Rules and Rule 10A-3 of the Exchange Act. The Audit Committee has certain duties and powers as described in its written charter adopted by the Board of Directors. A copy of the charter can be found on the Company’s website at https://www.summittxinc.com/.
As described more fully in its charter, the purpose of the Audit Committee is to assist the Board of Directors with its oversight responsibilities regarding the integrity of our financial statements, our compliance with legal and regulatory requirements, assessing the independent auditor’s qualifications and independence, the performance and scope of independent audit procedures performed on our financial statements and internal control, and management’s process for assessing the adequacy of our system of internal control. Management is responsible for preparation, presentation, and integrity of our financial statements as well as our financial reporting process, accounting policies, internal control over financial reporting, and disclosure controls and procedures. The independent registered public accounting firm is responsible for performing an independent audit of our consolidated financial statements in accordance with generally accepted auditing standards and to issue a report thereon. The Audit Committee’s responsibility is to monitor and oversee these processes.
The Audit Committee has:
•reviewed and discussed our audited financial statements with management and PricewaterhouseCoopers LLP, the independent auditors;
•discussed with PricewaterhouseCoopers LLP the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (the “PCAOB”) and the SEC; and
•received from PricewaterhouseCoopers LLP the written disclosures and the letter required by applicable requirements of the PCAOB regarding the independent auditors’ communications with the Audit Committee concerning independence, and discussed with the auditors their independence.
In addition, the Audit Committee has regularly met separately with management and with PricewaterhouseCoopers LLP, and further to the matters specified above, has discussed with PricewaterhouseCoopers LLP the overall scope, plans, and estimated costs of its audit.
Based on the review and discussions referred to above, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 2021 for filing with the SEC.
Members of the Audit Committee
Manmeet S. Soni (Chair)
Kenneth A. Clark
Ujwala Mahatme
DELINQUENT SECTION 16(a) REPORTS
Section 16(a) of the Exchange Act requires that our executive officers and directors and other persons who beneficially own more than 10% of a registered class of our equity securities file with the SEC reports of ownership and reports of changes in ownership of shares and other equity securities. Such executive officers and directors and other persons who beneficially own more than 10% of a registered class of our equity securities are required by the SEC to furnish us with copies of all Section 16(a) reports filed by such reporting persons.
Based solely on our review of such forms furnished to us or written representations provided to us by the reporting person, we are aware of no late Section 16(a) reports required to be filed by our executive officers, directors and other persons who beneficially own more than 10% of a registered class of our equity securities in the year ended December 31, 2021 other than a late Form 4 for Urte Gayko filed on November 16, 2021 to report the acquisition of stock options received by Dr. Gayko on November 3, 2021.
OTHER INFORMATION
Stockholder Proposals
Stockholder Proposals for 2023 Annual Meeting
The submission deadline for stockholder proposals to be included in our proxy materials for the 2022 annual meeting of stockholders pursuant to Rule 14a-8 of the Exchange Act is December 30, 2022 except as may otherwise be provided in Rule 14a-8. All such proposals must be in writing and received by our Corporate Secretary at Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 02142 by close of business on the required deadline in order to be considered for inclusion in our proxy materials for the 2023 annual meeting of stockholders. Submission of a proposal before the deadline does not guarantee its inclusion in our proxy materials.
Advance Notice Procedure for 2023 Annual Meeting
Under our Bylaws, director nominations and other business may be brought at an annual meeting of stockholders in accordance with the requirements of our Bylaws as in effect from time to time. For the 2023 annual meeting of stockholders, a stockholder notice must be received by our Corporate Secretary at Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 02142, not later than the close of business on the 90th day nor earlier than the close of business on the 120th day before the one-year anniversary of the date on which we first mailed proxy materials or a notice of availability of proxy materials (whichever is earlier) for the previous year’s annual meeting. However, if the 2023 annual meeting of stockholders is advanced by more than 30 days prior to, or delayed by more than 60 days after, the one-year anniversary of the 2022 annual meeting of stockholders, then, for notice by the stockholder to be timely, it must be received by our Corporate Secretary not earlier than the close of business on the 120th day prior to the 2023 annual meeting of stockholders and not later than the close of business on the later of (i) the 90th day prior to the 2023 annual meeting of stockholders, or (ii) the 10th day following the day on which public announcement of the date of such annual meeting is first made. Please refer to the full text of our Bylaw provisions for additional information and requirements. A copy of our current Bylaws has been filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and may be obtained by writing to our Corporate Secretary at the address listed in our proxy materials.
Stockholders Sharing the Same Address
The SEC has adopted rules that allow a company to deliver a single proxy statement or annual report to an address shared by two or more of its stockholders. This method of delivery, known as “householding,” permits us to realize significant cost savings, reduces the amount of duplicate information stockholders receive, and reduces the environmental impact of printing and mailing documents to our stockholders. Under this process, certain stockholders will receive only one copy of our proxy materials and any additional proxy materials that are delivered until such time as one or more of these stockholders notifies us that they want to receive separate copies. Any stockholders who object to or wish to begin householding may notify our Investor Relations Department at investors@summitplc.com or Investor Relations, One Broadway, 142882 Sand Hill Road, Suite 106, Menlo Park, California 94025.
th Floor, Cambridge, Massachusetts 02142.
Fiscal Year 2021 Annual Report and SEC FilingsOTHER MATTERS
Our financial statements for the fiscal year ended December 31, 2021 are included in our Annual Report on Form 10-K. Our Annual Report and thisThis Proxy Statement areis posted on our website at https://www.summittxinc.com/ and areis also available from the SEC at its website at www.sec.gov. You may also obtain a copy of our Annual Report without charge by sending a written request to Investor Relations, Summit Therapeutics Inc., One Broadway, 14th Floor, Cambridge, Massachusetts 02142.
* * *
The Boardboard of Directorsdirectors does not know of any other matters to be presented at the AnnualSpecial Meeting. If any additional matters are properly presented at the AnnualSpecial Meeting, the persons named in the enclosed proxy card will have discretion to vote the shares of our common stock they represent in accordance with their own judgment on such matters.
It is important that your shares of our common stock be represented at the AnnualSpecial Meeting, regardless of the number of shares that you hold. You are, therefore, requested to vote by telephone or by using the Internet as instructed on the enclosed proxy card or execute and return, at your earliest convenience, the enclosed proxy card in the envelope that has also been provided.
THE BOARD OF DIRECTORS
Menlo Park, California
December __, 2022
Annex A
AMENDMENT NO. 2
TO
RESTATED
CERTIFICATE OF INCORPORATION
OF
SUMMIT THERAPEUTICS INC.
Pursuant to Section 242 of the
General Corporation Law of the State of Delaware
Summit Therapeutics Inc. (the “Company”), a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, does hereby certify as follows:
A resolution was duly adopted by the Board of Directors (the “Board”) of the Company pursuant to Section 242 of the General Corporation Law of the State of Delaware setting forth an amendment to the Restated Certificate of Incorporation of the Company (the “Charter Amendment”) and declaring said amendment to be advisable. The stockholders of the Company duly approved said proposed amendment at a special meeting of the stockholders called and held on _____ [ ], 202_, upon notice in accordance with Section 222 of the General Corporation Law of the State of Delaware, by voting the necessary number of shares as required by statute in favor of the Charter Amendment. The resolution setting forth the amendment is as follows:
RESOLVED, that the Board hereby approves and recommends that the Company’s stockholders approve that the first paragraph of the FOURTH Article of the Restated Certificate of Incorporation, dated September 18, 2020, as amended by that Amendment to the Restated Certificate of Incorporation, dated July 27, 2022 be deleted in its entirety and replaced with the following language:
“The total number of shares of all classes of capital stock that the Corporation shall have authority to issue is 1,020,000,000 shares, consisting of (i) 1,000,000,000 shares of Common stock, $0.01 par value per share (the “Common Stock”), and (ii) 20,000,000 shares of Preferred stock, $0.01 par value per share (the “Preferred Stock”).”
Cambridge, Massachusetts
IN WITNESS WHEREOF, the Company has caused its corporate seal to be affixed hereto and this Charter Amendment to be signed by its [TITLE OF EMPLOYEE] this [ ] day of ____, 202_.
April 2022
SUMMIT THERAPEUTICS INC.
By:
Annex B
AMENDMENT NO. 2
TO
RESTATED
CERTIFICATE OF INCORPORATION
OF
SUMMIT THERAPEUTICS INC.
Pursuant to Section 242 of the
General Corporation Law of the State of Delaware
Summit Therapeutics Inc. (the “Corporation”), a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, does hereby certify as follows:
3.The Certificate of Incorporation was further amended by the Amendment to the Restated Certificate of Incorporation of Summit Therapeutics Inc., filed with the Secretary of State of Delaware on July 27, 2022.
4.Resolutions were duly adopted by the Board of Directors of the Corporation setting forth this proposed Amendment No. 2 to the Certificate of Incorporation and declaring said amendment to be advisable and calling for the consideration and approval thereof at a meeting of the stockholders of the Corporation.
5.Resolutions were duly adopted by the Board of Directors of the Corporation, in accordance with the provisions of the Certificate of Incorporation set forth below, providing that, effective as of [●], New York time, on [●], each [●] (#) issued and outstanding shares of the Corporation’s Common Stock, par value $0.01 per share, shall be converted into [●] (#) share of the Corporation’s Common Stock, par value $0.01 per share, as constituted following such date.
6.The Certificate of Incorporation is hereby amended by revising Article FOURTH to include a new paragraph as follows:
Upon the filing and effectiveness (the “Effective Time”) pursuant to the General Corporation Law of the State of Delaware (the “DGCL”) of this Certificate of Amendment to the Certificate of Incorporation of the Corporation, each [ ] shares of the Corporation’s common stock, par value $0.01 per share (the “Common Stock”), issued and outstanding or held by the Corporation in treasury stock immediately prior to the Effective Time shall automatically be combined into one (1) validly issued, fully paid and non-assessable share of Common Stock without any further action by the Corporation or the holder thereof, subject to the treatment of fractional interests as described below. Notwithstanding the immediately preceding sentence, no fractional shares will be issued in connection with the reverse stock split. Stockholders of record who otherwise would be entitled to receive fractional shares, will be entitled to rounding up of their fractional share to the nearest whole share. No stockholder will receive cash in lieu of fractional shares. Each certificate that immediately prior to the Effective Time represented shares of Common Stock (the “Old Certificates”) shall thereafter represent that number of shares of Common Stock into which the shares of Common Stock represented by the Old Certificate shall have been combined, subject to the adjustment for fractional shares as described above.
7.Pursuant to the resolution of the Board of Directors, a meeting of the stockholders of the Company was duly called and held upon notice in accordance with Section 222 of the General Corporation Law of the State of Delaware at which meeting the necessary number of shares as required by statute were voted in favor of the foregoing amendment.
8.The foregoing amendment was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal to be affixed hereto and this Charter Amendment to be signed by its [TITLE OF EMPLOYEE] this [ ] day of _____, 202_.
SUMMIT THERAPEUTICS INC.
By:
[ ]
