Document

DEF 14A 1 exicureproxy2021.htm DEF 14A Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________________________________________________

SCHEDULE 14A

(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No. )

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Exicure, Inc.

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QUESTIONS AND ANSWERS ABOUT THESE PROXY MATERIALS AND VOTING PROCEDURES									1
PROPOSAL 1: ELECTION OF DIRECTORS									8
PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM									12
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT									14
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS									16
BOARD OF DIRECTORS AND CORPORATE GOVERNANCE									18
DIRECTOR COMPENSATION									24
EXECUTIVE OFFICERS									26
EXECUTIVE COMPENSATION									27
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS									32
HOUSEHOLDING OF PROXY MATERIALS									33
OTHER MATTERS									34
ADDITIONAL INFORMATION									35


(1)			This proposal is considered to be a “routine” matter under NYSE rules. Accordingly, if you hold your shares in street name and do not provide voting instructions to your broker, bank or other agent that holds your shares, your broker, bank or other agent has discretionary authority under NYSE rules to vote your shares on this proposal.


	Year Ended December 31,
	2020		2019
Audit Fees(1)	$	482,000	$	464,000
Audit-Related Fees(2)	160,000		243,000
Total Fees	$	642,000	$	707,000


(1)			Audit fees for the fiscal years ended December 31, 2020 and 2019 consist of fees for professional services rendered in connection with the audit of our annual financial statements and review of our quarterly financial statements.
(2)			Audit-related fees for the fiscal years ended December 31, 2020 and 2019 consist principally of fees for professional services rendered that are reasonably related to the performance of the audit or review of our financial statements and fees related to assistance with registration statements filed with the SEC.



	Beneficial Ownership
Beneficial Owner Greater than 5% Stockholders	Number of Shares Beneficially Owned (#)	Percentage of Common Stock Beneficially Owned (%)
AuraSense, LLC (1)	11,257,629	12.8	%
Tybourne Capital Management (HK) Limited (2)	7,340,000	8.3	%
Abingworth Bioventures VII LP (3)	6,977,000	7.9	%
Gates Frontier, LLC (4)	6,333,322	7.2	%
Directors and Named Executive Officers
Jeffrey L. Cleland, Ph.D. (5)	46,398	*
Douglas Feltner, M.D. (5)	100,000	*
Elizabeth Garofalo, M.D. (5)	5,555	*
David A. Giljohann, Ph.D. (6)	2,129,051	2.4	%
Bosun Hau (5)	45,193	*
Chad A. Mirkin, Ph.D. (7)	11,494,133	13.0	%
Bali Muralidhar, M.D., Ph.D. (8)	7,022,193	8.0	%
Andrew Sassine (9)	205,555	*
Matthias Schroff, Ph.D. (5)	265,937	*
James Sulat (5)	4,820	*
Timothy P. Walbert (5)	46,398	*
David R. Walt, Ph.D. (10)	2,221,345	2.5	%

All directors and executive officers as a group (12 persons) (11)	23,586,578	25.9	%


*			Indicates beneficial ownership of less than one percent of the outstanding shares of common stock.
(1)			This amount excludes (i) 64,649 shares of common stock held by Chad A. Mirkin, Ph.D., (ii) 33,936 shares of common stock held by the Chad A. Mirkin Living Trust, for which Dr. Mirkin is trustee and holds voting and investment power, (iii) 25,000 shares of common stock held by BSR Enterprises, LLC, for which Dr. Mirkin is a member of the board of managers, and (iv) 112,919 shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021. AuraSense, LLC does not have beneficial ownership of the shares held by Dr. Mirkin, the Chad A. Mirkin Living Trust or BSR Enterprises, LLC. Dr. Mirkin is a member of the board of managers of AuraSense, LLC and has voting and dispositive power over the shares held by AuraSense, LLC. The address of AuraSense, LLC is 2737 Blackhawk Rd., Wilmette, IL 60091.
(2)			This information has been obtained from a Schedule 13F filed on February 11, 2021 by Tybourne Capital Management (HK) Limited. This amount, as of December 31, 2020, includes zero shares and 7,340,000 shares over which Tybourne Capital Management (HK) Limited has sole voting power and sole dispositive power, respectively. The address of Tybourne Capital Management (HK) Limited is 30/F, AIA Central, 1 Connaught Road C, Hong Kong, K3.
(3)			This information has been obtained from a Schedule 13F filed on March 1, 2021 by Abingworth LLP. This amount, as of December 31, 2020, includes 6,977,000 shares over which Abingworth Bioventures V, LP has sole voting power and shared dispositive power. Abingworth LLP, as the investment manager of Abingworth Bioventures V, LP, may be deemed to share voting and dispositive power over the shares held by Abingworth Bioventures V, LP. The address of Abingworth Bioventures V, LP is 38 Jermyn Street, London SW1Y 6DN, United Kingdom.
(4)			This information has been obtained in part from a Schedule 13G filed on October 5, 2017 by Gates Frontier, LLC (formerly Gates Ventures, LLC). William H. Gates III has sole voting and dispositive power over the shares of the Company as the sole member of Gates Frontier, LLC. The address of the principal place of business of William H. Gates III is One Microsoft Way, Redmond, Washington 98052. The address of Gates Frontier, LLC is 2365 Carillon Point, Kirkland, Washington 98033.
(5)			Consists of shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021.
(6)			Consists of (i) 23,666 share of common stock held by Dr. Giljohann and (ii) 2,105,385 shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021. Dr. Giljohann, a member of the board of managers of AuraSense, LLC, does not have beneficial ownership of the shares held by AuraSense, LLC.
(7)			Consists of (i) 64,649 shares of common stock held by Dr. Mirkin, (ii) 33,936 shares of common stock held by the Chad A. Mirkin Living Trust, for which Dr. Mirkin is trustee and holds voting and investment power, (iii) 25,000 shares of common stock held by BSR Enterprises, LLC, for which Dr. Mirkin is a member of the board of managers, (iv) 112,919 shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021, and (v) 11,257,629 shares of common stock held by AuraSense, LLC as described in footnote (1). Dr. Mirkin is a member of the board of managers of AuraSense, LLC and has voting and dispositive power over the shares held by AuraSense, LLC. This amount excludes shares of common stock held by Dr. Mirkin’s brother, who does not live in the same household as Dr. Mirkin. Dr. Mirkin disclaims beneficial ownership of the shares held by his brother. Dr. Mirkin has notified the Board of his intention to resign effective April 30, 2021. The address of Dr. Mirkin is c/o AuraSense, LLC, 2737 Blackhawk Rd., Wilmette, IL 60091.
(8)			Consists of (i) 6,977,000 shares of common stock held by Abingworth Bioventures V, LP as described in footnote (3) and (ii) 45,193 shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021. Bali Muralidhar, M.D., Ph.D., a member of our Board, is a partner of Abingworth LLP and may be deemed to share voting and dispositive power over the shares held by Abingworth Bioventures V, LP. Dr. Muralidhar disclaims beneficial ownership of the shares held by Abingworth Bioventures V, LP.
(9)			Includes 5,555 shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021.
(10)			Dr. Walt has notified the Board of his intention to resign from the Board when his term expires at this Annual Meeting. Includes 162,568 shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021. This amount excludes shares of common stock held by Dr. Walt’s children, who do not live in the same household as Dr. Walt. Dr. Walt disclaims beneficial ownership of the shares held by his children.
(11)			Consists of (i) 20,640,657 shares of common stock held by members of our Board of Directors and current executive officers, including 11,257,629 shares of common stock held by AuraSense, LLC, for which Dr. Mirkin has voting and dispositive power, and 6,977,000 shares of common stock held by Abingworth Bioventures V, LP, for which Dr. Muralidhar be may deemed to share voting and dispositive power, and (ii) 2,945,921 shares of common stock issuable upon the exercise of options exercisable within 60 days of March 31, 2021 held by all current executive officers and directors as a group.


Name	Shares of Common Stock Purchased	Total Purchase Price
Tybourne Capital Management (HK) Ltd.(1)	1,090,000	$	2,997,500
AWM Investment Company, Inc.(2)	925,000	$	2,543,750
Abingworth Bioventures VII LP (3)	727,000	$	1,999,250


(1)			Tybourne Capital Management (HK) Limited holds more than 5% of our capital stock.
(2)			AWM Investment Company, Inc. held more than 5% of our capital stock as of March 31, 2020.
(3)			Dr. Muralidhar, a member of our Board, is an affiliate of Abingworth LLP, which is the investment manager of Abingworth Bioventures V, LP.


(1)			Tybourne Capital Management (HK) Limited holds more than 5% of our capital stock.
(2)			Dr. Muralidhar, a member of our Board, is an affiliate of Abingworth LLP, which is the investment manager of Abingworth Bioventures V, LP.
(3)			As of September 25, 2019, EcoR1 Capital, LLC and certain affiliated entities held more than 5% of our capital stock. On February 14, 2020, EcoR1 Capital, LLC and such affiliated entities reported that as of December 31, 2019, EcoR1 Capital, LLC and such affiliated entities no longer held more than 5% of our capital stock.
(4)			AWM Investment Company, Inc. held more than 5% of our capital stock as of March 31, 2020.
(5)			David R. Walt, Ph.D. is a member of our Board and is not standing for re-election when his term expires at the Annual Meeting.
(6)			Jay R. Venkatesan, M.D. resigned from our Board effective December 29, 2020.
(7)			Chad A. Mirkin, Ph.D., is an affiliate of BSR Enterprises, LLC. Dr. Mirkin has notified the Board of his intention to resign effective April 30, 2021.


(1)			Dr. Mirkin has notified the Board of his intention to resign effective April 30, 2021.
(2)			Dr. Walt is a member of our Board and is not standing for re-election when his term expires at the Annual Meeting.
(3)			Committee chairperson.


Name	Fees Earned or Paid In Cash ($)	Option Awards (1)(2) ($)	All Other Compensation ($)	Total ($)
Jeffrey L. Cleland, Ph.D.	40,000	40,800	—	80,800
Bosun Hau	42,500	40,800	—	83,300
Helen S. Kim (3)	43,750	40,800	—	84,550
Chad A. Mirkin, Ph.D.(4)	42,995	40,800	100,000(5)	183,795
Bali Muralidhar, M.D., Ph.D.	44,672	40,800	—	85,472
Jay R. Venkatesan, M.D.(6)	50,000	40,800	—	90,800
Timothy P. Walbert	69,505	40,800	—	110,305
David R. Walt, Ph.D.(7)	45,000	40,800	—	85,800


Name	2020 BASE SALARY ($)	2021 BASE SALARY ($)
David A. Giljohann, Ph.D. Chief Executive Officer and Interim Chief Financial Officer	537,000	550,000
Matthias G. Schroff, Ph.D. Chief Operating Officer	375,000	425,000
Douglas E. Feltner, M.D. Chief Medical Officer	365,000	400,000


Name	2020 BONUS TARGET (%)	2021 BONUS TARGET (%)
David A. Giljohann, Ph.D. Chief Executive Officer and Interim Chief Financial Officer	55	55
Matthias G. Schroff, Ph.D. Chief Operating Officer	40	40
Douglas Feltner, M.D. Chief Medical Officer	30	40


Name and principal position	Year	Salary ($)(1)	Option awards ($)(2)	Non-equity incentive plan compensation ($)(3)	All other compensation ($)(4)	Total ($)
David A. Giljohann, Ph.D. Chief Executive Officer and Interim Chief Financial Officer	2020	560,752	725,440	265,815	9,750	1,561,757
	2019	538,462	—	237,500	9,500	785,462
Douglas E. Feltner, M.D. Chief Medical Officer (5)	2020	239,882	770,480	63,480	—	1,073,842

Matthias G. Schroff, Ph.D. Chief Operating Officer	2020	375,000	—	138,000	12,250	525,250
	2019	375,000	—	89,063	12,250	476,313


(1)			The amounts reported in this column reflect the grant date fair value of the option awards granted to the director during the year presented and do not reflect the actual amounts earned. Such grant date fair values do not take into account any estimated forfeitures related to service-based vesting conditions. These values have been determined in accordance with Financial Accounting Standards Board Accounting Standards Codification, Topic 718 (“FASB ASC 718”). See Note 9 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 11, 2021 for a discussion of the relevant assumptions used in calculating these amounts.
(2)			As of December 31, 2020, each individual who served as a non-employee director during 2020 had outstanding options to purchase the following number of shares: Jeffrey L. Cleland, Ph.D., 65,079; Bosun Hau, 65,079; Helen S. Kim, 151,721; Chad A. Mirkin, Ph.D., 114,727; Bali Muralidhar, M.D., Ph.D. 65,079; Jay R. Venkatesan, M.D., 79,056; Timothy P. Walbert, 65,079; and David R. Walt, Ph.D., 164,376.
(3)			Ms. Kim resigned from the Board of Directors and the Nominating and Corporate Governance Committee, effective November 10, 2020.
(4)			Dr. Mirkin has notified the Board of his intention to resign effective April 30, 2021.
(5)			Represents consulting fees received by Dr. Mirkin for providing consulting services to us during 2020. See “Consulting Arrangement” below for further information.
(6)			Dr. Venkatesan resigned from the Board of Directors and the Audit Committee, effective December 29, 2020.
(7)			Dr. Walt notified the Board of Directors of his intention not to stand for re-election when his term expires at the Annual Meeting.


(1)			Amounts reported in this column include the payouts for accrued but unused vacation: Dr. Giljohann: $23,752 (2020) and $38,462 (2019); Dr. Feltner: $11,757 (2020).
(2)			The amounts reported in this column reflect the grant date fair value of the option awards granted to the named executive officers during the years presented and do not reflect the actual amounts earned. Such grant date fair values do not take into account any estimated forfeitures related to service-based vesting conditions. These values have been determined in accordance with FASB ASC Topic 718. See Note 9 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020 as filed with the SEC on March 11, 2021 for a discussion of the relevant assumptions used in calculating these amounts.
(3)			Pursuant to the terms of the named executive officer’s employment agreement or offer letter, each named executive officer is eligible to receive an annual bonus award under our annual cash incentive bonus program, subject to the achievement of annual performance milestones as determined by the Compensation Committee in its sole discretion. The amounts reported for 2020 represent the earned amounts in connection with the achievement of 2020 annual performance milestones (paid in 2021). The amounts reported for 2019 represent the earned amounts in connection with the achievement of 2019 annual performance milestones (paid in 2020).
(4)			The amounts reported in this column represent a match of contributions to our 401(k) savings plan.
(5)			Dr. Feltner was appointed as our Chief Medical Officer in May 2020.


Name	Grant Date	Vesting Commencement Date	Number of securities underlying unexercised options exercisable (#)	Number of securities underlying unexercised options unexercisable (#)	Option exercise price ($)(1)	Option expiration date
David A. Giljohann, Ph.D.	11/20/2012(2)	11/20/2012	24,824	-	0.65	11/20/2022
	12/31/2012(2)	12/31/2012	24,824	-	0.65	12/31/2022
	1/29/2014(2)	1/29/2014	248,372	-	0.65	1/29/2024
	4/28/2015(3)	2/20/2015	347,543	-	1.03	4/28/2025
	11/24/2015(3)	11/24/2015	709,145	-	1.98	11/24/2025
	1/4/2017(3)	12/15/2016	496,489	-	4.21	1/4/2027
	3/13/2020(3)	3/13/2020	163,407	708,097	1.19	3/12/2030
Douglas E. Feltner, M.D.	6/3/2020(2)	5/18/2020	-	400,000	2.72	6/2/2030
Matthias G. Schroff, Ph.D.	5/1/2018(2)	4/1/2018	230,000	115,000	3.00	5/1/2028


(1)			In connection with the October 2014 repricing of our outstanding option awards, the option exercise price for all outstanding options that were granted prior to October 2014 was adjusted to $0.65 per share.
(2)			25% of the shares subject to these options vest on the one-year anniversary of the vesting commencement date, and 1/48th of the shares subject to these options vest each month thereafter on the same day of the month as the vesting commencement date (or if there is no corresponding day, on the last day of such month), subject to the executive continuing to be employed by us through the applicable vesting date.
(3)			These options vest in 48 equal monthly installments, commencing on the vesting commencement date and subject to the executive continuing to be employed by us through the applicable vesting date.


Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights	Weighted- average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
	(a)	(b)		(c)
Equity compensation plans approved by stockholders	7,013,117	$	2.24	3,249,963	(1) (2)
Equity compensation plans not approved by stockholders	-	-		-
Total	7,013,117	$	2.24	3,249,963


(1)			Represents 2,309,030 and 940,933 shares of common stock available for issuance under the 2017 Equity Incentive Plan and 2017 Employee Stock Purchase Plan, respectively, as of December 31, 2020.
(2)			The number of shares of common stock reserved for issuance under the 2017 Equity Incentive Plan automatically increases on January 1 of each year, beginning on January 1, 2020, by the lesser of (i) 4,600,000 shares, (ii) 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or (iii) a lesser number of shares determined by the Compensation Committee. Effective January 1, 2021, pursuant to the terms of the 2017 Equity Incentive Plan, the number of awards that are reserved and may be awarded under the 2017 Equity Incentive Plan was automatically increased by 4,382,567 awards. The number of shares of common stock reserved for issuance under the 2017 Employee Stock Purchase Plan automatically increases on January 1 of each year, beginning on January 1, 2018, by the lesser of (i) 300,000 shares of common stock, (ii) 0.3% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or (iii) such lesser number of shares determined by our Board. Effective January 1, 2021, pursuant to the terms of the 2017 Employee Stock Purchase Plan, the number of shares that are reserved and may be issued under the 2017 Employee Stock Purchase Plan was automatically increased by 262,954 shares.



By Order of the Board of Directors,

/s/ David A. Giljohann
David A. Giljohann, Ph.D.
Chief Executive Officer, Interim Principal Financial Officer, Corporate Secretary and Director