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230 Constitution Drive
Menlo Park, CA 94025
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on May 6,
2005
To the Stockholders of Geron Corporation:
1. |
To elect one Class III director to hold office until the Annual Meeting of Stockholders in 2008 and until the election and qualification of his respective successor; |
2. |
To ratify appointment of Ernst & Young LLP as the Companys independent auditors for the fiscal year ending December 31, 2005; and |
3. |
To transact such other business as may properly come before the Annual Meeting or any postponement or adjournment thereof. |
Menlo Park, California
March 15, 2005
INFORMATION CONCERNING SOLICITATION AND VOTING
General
Solicitation and Voting of Proxies
Quorum Requirement and Votes Required for the Proposals
1
Geron Plan Participants
Voting Via the Internet or by Telephone
Revocability of Proxies
MATTERS TO BE CONSIDERED AT THE 2005 ANNUAL MEETING
PROPOSAL 1
ELECTION OF DIRECTORS
2
NOMINEE FOR ELECTION TO THE BOARD OF DIRECTORS
For a Three Year Term
Expiring at the
2008 Annual Meeting
Nominee for Class III Director (Term Expiring at the 2008 Annual Meeting)
Name |
Age |
Principal Occupation/Position with the Company |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Alexander E.
Barkas, Ph.D. |
57 | Managing Member, Prospect Management Company, LLC; General Partner, Prospect Venture Partners L.P.; Managing Member, Prospect Management Co.
II, LLC; General Partner of Prospect Venture Partners II, L.P. and Prospect Associates II, L.P.; Managing Member, Prospect Management Co. III, LLC.;
and General Partner of Prospect Venture Partners III, L.P. |
The Board of Directors Unanimously Recommends That Stockholders
Vote
FOR the Election of Each Nominee to the Board of Directors
MEMBERS OF THE BOARD OF DIRECTORS CONTINUING IN OFFICE
3
Class I Directors (Term Expiring at the 2006 Annual Meeting)
Name |
Age |
Principal Occupation/Position with the Company |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Thomas B.
Okarma, Ph.D., M.D |
59 | President and Chief Executive Officer |
||||||||
John P.
Walker |
56 | Private Investor/Consultant |
||||||||
Patrick J.
Zenner |
58 | Former President and CEO, Hoffmann La-Roche, Inc., North America |
Class II Directors (Term Expiring at the 2007 Annual Meeting)
Name |
Age |
Principal Occupation/Position with the Company |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Thomas D.
Kiley, Esq. |
61 | Attorney-at-law |
||||||||
Edward V.
Fritzky |
54 | Former Chairman, CEO and President, Immunex Corporation |
4
Board Committees and Meetings
5
Compensation of Directors
Fees
(i) |
Twelve Thousand Dollars ($12,000) per year, plus an additional Six Thousand Dollars ($6,000) for service as Chair of the Board and an additional Two Thousand Dollars ($2,000) for service as Chair of the Audit Committee or the Compensation Committee of the Board; plus |
(ii) |
One Thousand Dollars ($1,000) for each regular or special Board meeting attended by such director in person, and Seven Hundred Fifty Dollars ($750) for each regular or special Board meeting attended by such director by telephone or videoconference; plus |
(iii) |
For members of the Audit Committee and the Compensation Committee of the Board, Five Hundred Dollars ($500) for each meeting of either such committee attended by such director in person, and Two Hundred Fifty Dollars ($250) for each meeting of either such committee attended by such director by telephone or videoconference; plus |
(iv) |
Reimbursement for out-of-pocket expenses incurred in connection with attendance at meetings of the Board of Directors. |
Director |
Number of Shares Issued Under the 2002 Equity Incentive Plan |
Price Per Share |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Barkas,
Alexander |
2,646 | $ | 7.56 | |||||||
Fritzky,
Edward |
1,587 | $ | 7.56 | |||||||
Kiley,
Thomas |
1,587 | $ | 7.56 |
6
Directors Stock Option Plan
Director |
Number of Shares Subject to Options Granted under the Directors Plan |
Weighted Average Exercise Price Per Share |
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Barkas,
Alexander |
32,500 | $ | 7.56 | |||||||
Fritzky,
Edward |
22,500 | $ | 7.56 | |||||||
Kiley,
Thomas |
22,500 | $ | 7.56 | |||||||
Walker,
John |
22,500 | $ | 7.56 | |||||||
Zenner,
Patrick |
22,500 | $ | 7.56 |
7
Additional Option Grant to Director
8
PROPOSAL 2
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
9
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Beneficial Ownership(1) |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Beneficial Owner |
Number of Shares |
Percent of Total |
|||||||||
Directors/Nominees and Named Executive Officers: |
|||||||||||
Alexander E.
Barkas, Ph.D.(2) |
321,349 | * |
|||||||||
Edward V.
Fritzky(3) |
151,170 | * |
|||||||||
Thomas D.
Kiley, Esq.(4) |
182,970 | * |
|||||||||
John P.
Walker(5) |
133,183 | * |
|||||||||
Patrick J.
Zenner(6) |
107,083 | * |
|||||||||
David J.
Earp, J.D., Ph.D.(7) |
306,458 | * |
|||||||||
David L.
Greenwood(8) |
669,316 | 1.21% |
|||||||||
Calvin B.
Harley, Ph.D.(9) |
417,360 | * |
|||||||||
Jane S.
Lebkowski, Ph.D.(10) |
338,076 | * |
|||||||||
Thomas B.
Okarma, Ph.D., M.D.(11) |
1,093,036 | 1.96% |
|||||||||
All directors
and executive officers as a group (11 persons) |
3,894,520 | 6.68% |
* |
Represents beneficial ownership of less than 1% of the Common Stock. |
(1) |
Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission. In computing the number of shares beneficially owned by a person and the percentage of ownership of that person, shares of Common Stock subject to options held by that person that are currently exercisable or exercisable within 60 days of February 21, 2005 are deemed outstanding. Such shares, however, are not deemed outstanding for the purpose of computing the percentage ownership of each other person. The persons named in this table, to the best of the Companys knowledge, have sole voting and investment power with respect to all shares of Common Stock shown as beneficially owned by them, subject to community property laws where applicable and except as indicated in the other footnotes to this table. |
(2) |
Includes 14,183 shares held directly by Alexander E. Barkas, 882 shares held by Lynda Wijcik, the spouse of Dr. Barkas, 17,056 shares held by the Barkas-Wijcik Trust under Agreement dated July 26, 1999, and 289,228 shares issuable upon the exercise of outstanding options held by Dr. Barkas exercisable within 60 days of February 21, 2005. |
(3) |
Represents 11,587 shares held directly by Edward V. Fritzky and 139,583 shares issuable upon the exercise of outstanding options held by Mr. Fritzky exercisable within 60 days of February 21, 2005. |
(4) |
Includes 1,587 shares held directly by Thomas D. Kiley, 9,705 shares held by the Kiley Family Partnership and 21,654 shares held by the Thomas D. Kiley and Nancy L.M. Kiley Revocable Trust under Agreement dated August 7, 1981. Also includes 150,024 shares issuable upon the exercise of outstanding options held by Mr. Kiley exercisable within 60 days of February 21, 2005. |
(5) |
Represents 133,183 shares issuable upon the exercise of outstanding options held by John P. Walker exercisable within 60 days of February 21, 2005. |
(6) |
Represents 107,083 shares issuable upon the exercise of outstanding options held by Patrick J. Zenner exercisable within 60 days of February 21, 2005. |
10
(7) |
Includes 18,749 shares held directly by David J. Earp and 287,709 shares issuable upon the exercise of outstanding options held by Dr. Earp exercisable within 60 days of February 21, 2005. |
(8) |
Includes 11,931 shares held directly by David L. Greenwood and 657,385 shares issuable upon the exercise of outstanding options held by Mr. Greenwood exercisable within 60 days of February 21, 2005. |
(9) |
Includes 5,918 shares held directly by Calvin B. Harley and 411,442 shares issuable upon the exercise of outstanding options held by Dr. Harley exercisable within 60 days of February 21, 2005. |
(10) |
Includes 17,137 shares held directly by Jane S. Lebkowski and 320,939 shares issuable upon the exercise of outstanding options held by Dr. Lebkowski exercisable within 60 days of February 21, 2005. |
(11) |
Includes 18,766 shares held directly by Thomas B. Okarma and 1,074,270 shares issuable upon the exercise of outstanding options held by Dr. Okarma exercisable within 60 days of February 21, 2005. |
EQUITY COMPENSATION PLANS
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 security holders(1) |
6,567,270 | $ | 8.15 | 5,256,678 | (2),(3) | |||||||||
Equity
compensation plans not approved by security holders |
6,544,246 | (4) | $ | 5.22 | | |||||||||
Total |
13,111,516 | $ | 6.69 | 5,256,678 |
(1) |
Includes the 1992 Stock Option Plan, the 1996 Directors Stock Option Plan and the 2002 Equity Incentive Plan. |
(2) |
Includes 334,072 shares of common stock reserved for issuance under Gerons 1996 Employee Stock Purchase Plan. |
(3) |
Does not include future automatic annual increases under Gerons 2002 Equity Incentive Plan. The maximum number of shares to be reserved will automatically increase on each anniversary date of the Board of Directors adoption of the 2002 Plan during the term of the 2002 Plan by the least of (i) 2,000,000 shares, (ii) 4% of the Companys outstanding common stock as of such anniversary date, or (iii) a lesser amount determined by the Board. |
(4) |
Represents outstanding warrants issued in conjunction with equity financing transactions, consulting services agreements and license agreements with research institutions. For further details, see Note 11 of Notes to Consolidated Financial Statements of the Companys Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 28, 2005. |
11
EXECUTIVE COMPENSATION
Compensation of Executive Officers
Summary Compensation Table
Long-Term Compensation Awards |
||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Annual Compensation |
||||||||||||||||||||||||||
Name and Principal Position |
Year |
Salary($) |
Bonus($)(1) |
Other Annual Compensation($)(2) |
Securities Underlying Options(#) |
All Other Compensation($)(3) |
||||||||||||||||||||
Thomas B.
Okarma, M.D., Ph.D. |
2004 | $ | 441,000 | $ | 251,370 | $ | 0 | 100,000 | $ | 0 | ||||||||||||||||
President and
Chief |
2003 | 420,000 | 268,230 | 42,000 | 100,000 | 0 | ||||||||||||||||||||
Executive
Officer |
2002 | 420,000 | 0 | 0 | 305,000 | 0 | ||||||||||||||||||||
David L.
Greenwood |
2004 | 340,389 | 147,710 | 0 | 75,000 | 16,000 | ||||||||||||||||||||
Executive
Vice President, |
2003 | 310,010 | 153,040 | 31,000 | 75,000 | 14,000 | ||||||||||||||||||||
Chief
Financial Officer, |
2002 | 310,010 | 0 | 0 | 235,000 | 12,000 | ||||||||||||||||||||
Secretary and
Treasurer |
||||||||||||||||||||||||||
David J.
Earp, J.D., Ph.D. |
2004 | 267,583 | 101,490 | 0 | 50,000 | 13,000 | ||||||||||||||||||||
Senior Vice
President of |
2003 | 243,800 | 103,290 | 24,380 | 37,500 | 12,000 | ||||||||||||||||||||
Business
Development and |
2002 | 243,800 | 0 | 0 | 101,000 | 11,000 | ||||||||||||||||||||
Chief Patent
Counsel |
||||||||||||||||||||||||||
Jane S.
Lebkowski, Ph.D. |
2004 | 267,170 | 101,530 | 0 | 50,000 | 13,000 | ||||||||||||||||||||
Senior Vice
President of |
2003 | 235,400 | 99,730 | 23,540 | 37,500 | 12,000 | ||||||||||||||||||||
Regenerative
Medicine |
2002 | 235,400 | 0 | 0 | 106,000 | 11,000 | ||||||||||||||||||||
Calvin B.
Harley, Ph.D. |
2004 | 270,110 | 85,090 | 0 | 37,500 | 10,596 | ||||||||||||||||||||
Vice
President and Chief |
2003 | 257,250 | 74,260 | 25,725 | 37,500 | 14,000 | ||||||||||||||||||||
Scientific
Officer |
2002 | 257,250 | 0 | 0 | 100,000 | 12,000 |
(1) |
The Company paid the 2004 bonus with shares of Geron Common Stock equal to the value of each employees bonus amount at an average price of $8.82 per share. |
(2) |
The amounts in this column consist of retention bonuses paid in January 2004. Following the restructuring in January 2003, the Company entered into employment agreements with its remaining executive officers and certain other employees. Among other provisions, the employment agreements provided for the Company to pay on January 5, 2004 a retention bonus equal to 10% of the employees 2003 annual salary. The Company paid the retention bonuses with shares of Geron Common Stock equal to the value of each employees bonus amount at a price of $10.10 per share. See information about the employment agreements under Employment, Severance and Change of Control Agreements on page 14. |
(3) |
The amounts in this column consist of matching contributions made by the Company under the Geron 401(k) Plan, a plan providing for broad-based employee participation. Under the 401(k) Plan, participating employees may contribute up to the annual Internal Revenue Service contribution limit. In December 2004, 2003 and 2002, the Board of Directors approved a matching contribution equal to 100% of each employees annual contributions during 2004, 2003 and 2002, respectively. The matching contribution is invested in Gerons Common Stock and vests ratably over four years for each year of service completed by the employee, commencing from the date of hire, until it is fully vested when the employee has completed four years of service. The 2002 contributions were made on January 2, 2003 at a market value of $3.60 per share. The 2003 contributions were made on January 2, 2004 at a market value of $10.10 per share. The 2004 contributions were made on January 12, 2005 at a market value of $8.83 per share. |
12
Stock Option Grants in Fiscal Year 2004
Individual Grants |
|||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Potential Realizable Value at Assumed Annual Rates of Stock Price Appreciation for Option Term(4) |
|||||||||||||||||||||||||||
Name |
Number of Shares Underlying Options Granted(#)(1) |
Percent of Total Options Granted to Employees in Fiscal Year(2) |
Exercise or Base Price ($/sh)(3) |
Expiration Date |
5%($) |
10%($) |
|||||||||||||||||||||
Thomas B.
Okarma, Ph.D., M.D. |
100,000 | 10.5 | % | $ | 7.56 | 5/27/14 | $ | 475,444 | $ | 1,204,869 | |||||||||||||||||
David L.
Greenwood |
75,000 | 7.9 | % | $ | 7.56 | 5/27/14 | $ | 356,583 | $ | 903,652 | |||||||||||||||||
David J.
Earp, Ph.D., J.D. |
50,000 | 5.3 | % | $ | 7.56 | 5/27/14 | $ | 237,722 | $ | 602,435 | |||||||||||||||||
Jane S.
Lebkowski, Ph.D. |
50,000 | 5.3 | % | $ | 7.56 | 5/27/14 | $ | 237,722 | $ | 602,435 | |||||||||||||||||
Calvin B.
Harley, Ph.D. |
37,500 | 3.9 | % | $ | 7.56 | 5/27/14 | $ | 178,292 | $ | 451,826 |
(1) |
Each of these stock options, which were granted under the 2002 Equity Incentive Plan, is exercisable in a series of installments measured from the vesting commencement date generally over 48 months, provided that each Named Executive Officer continues to provide services to the Company. In the event of certain transactions involving a change in control of the Company, the options will vest in full. The maximum term of each option grant is ten years from the date of grant. |
(2) |
Based on an aggregate of 951,900 options granted by the Company under the 2002 Equity Incentive Plan in the year ended December 31, 2004 to all employees of the Company, including the Named Executive Officers. |
(3) |
Exercise price is equal to the closing sales price of the Common Stock underlying the stock option on the grant date as reported on the Nasdaq National Market. |
(4) |
The 5% and 10% assumed annual rates of compounded stock price appreciation are mandated by the Securities and Exchange Commission. There is no assurance provided to any executive officer or any other holder of the Companys securities that the actual stock price appreciation over the ten year option term will be at the assumed 5% and 10% levels or at any other defined level. Unless the market price of the Common Stock appreciates over the option term, no value will be realized from the option grants made to the executive officers. |
Aggregate Option Exercises in Fiscal Year 2004 and Fiscal Year-End Option Values
Number of Securities Underlying Unexercised Options at Fiscal Year-End(2)(#) |
Value of Unexercised in-the-Money Options at Fiscal Year-End(3)($) |
|||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Name |
Shares Acquired on Exercise(#) |
Value Realized(1)($) |
Vested |
Unvested |
Vested |
Unvested |
||||||||||||||||||||||
Thomas B.
Okarma, Ph.D., M.D |
| $ | | 1,022,396 | 342,604 | $ | 1,629,487 | $ | 660,883 | |||||||||||||||||||
David L.
Greenwood |
10,000 | 56,450 | 620,509 | 225,832 | 1,206,486 | 497,962 | ||||||||||||||||||||||
David J.
Earp, J.D., Ph.D. |
| | 267,970 | 119,530 | 199,819 | 202,706 | ||||||||||||||||||||||
Jane S.
Lebkowski, Ph.D. |
| | 300,575 | 121,925 | 358,432 | 211,913 | ||||||||||||||||||||||
Calvin B.
Harley, Ph.D. |
3,774 | 31,557 | 393,838 | 106,456 | 864,921 | 207,536 |
(1) |
Fair market value of the Companys Common Stock on the date of exercise (based on the closing sales price reported on the Nasdaq National Market or the actual sales price if the shares were sold by the optionee on the same date) less the exercise price. |
(2) |
These stock options, which were granted either under the 2002 Equity Incentive Plan or the 1992 Stock Option Plan, are exercisable in a series of installments measured from the vesting commencement date generally over 48 months, provided that each Named Executive Officer continues to provide services to the Company. In the |
13
event of certain transactions involving a change in control of the Company, the options will vest in full. The maximum term of each option grant is ten years from the date of grant. |
(3) |
Based on the closing sales price of the Common Stock as of December 31, 2004, quoted on the Nasdaq National Market ($7.97 per share), minus the per share exercise price, multiplied by the number of shares underlying the option. |
CERTAIN TRANSACTIONS
Promissory Note
Employment Agreements and Severance Plan
14
Compensation Committee Interlocks and Insider Participation
COMPENSATION COMMITTEE REPORT(1)
Philosophy
|
competitive pay practices, taking into account the pay practices of life science and pharmaceutical companies with which the Company competes for talented executives and are included in the Nasdaq-Pharmaceutical Index; |
|
annual incentive programs which are designed to encourage executives to focus on the achievement of specific short-term corporate goals as well as longer-term strategic objectives; and |
|
equity-based incentives designed to motivate executives over the long-term, to align the interests of management and stockholders and to ensure that management is appropriately rewarded for achievements which benefit the Companys stockholders. |
(1) |
This Section is not soliciting material, is not deemed filed with the SEC and is not to be incorporated by reference in any filing of the Company under the Securities Act of 1933, or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. |
15
Chief Executive Officer and Other Executive Officers Compensation
|
Base Salary: Base salary ranges are reviewed annually and adjustments are made at the beginning of the fiscal year to reflect changes in job description or market conditions. When establishing or reviewing compensation levels for each executive officer, the Committee considers numerous factors, including the qualifications of the executive, his or her level of relevant experience, specific operating roles and duties and strategic goals for which the executive has responsibility. |
|
Cash Bonus: Cash bonuses are awarded on a discretionary basis, usually following the Companys fiscal year-end, and are based on the achievement of corporate and individual goals set by the Board and the Companys Chief Executive Officer at the beginning of the year, as well as the financial condition of the Company. |
|
Stock Option Grants: The Company has used the grant of options under its 2002 Equity Incentive Plan to underscore the common interests of stockholders and management. Options granted to executive officers are intended to provide a continuing financial incentive to maximize long-term value to stockholders and to make each executives total compensation opportunity competitive. In addition, because stock options generally become exercisable over a period of several years, options encourage executives to remain in the long-term employ of the Company. In determining the size of an option to be granted to an executive officer, the Committee takes into account an officers position and level of responsibility within the Company, the officers existing stock and option holdings, and the potential reward to the officer if the stock price appreciates in the public market. |
|
closing of a financing resulting in net proceeds of $39.9 million; |
|
continued strengthening of intellectual property position; |
|
positive preliminary results from the telomerase cancer vaccine clinical study; |
|
continued progress in the telomerase inhibition drug development program; and |
|
continued progress in development of human embryonic stem cell programs. |
16
Compliance with Internal Revenue Code Section 162(m)
17
PERFORMANCE GRAPH(1)
Comparison of Five Year Cumulative Total Return on Investment Among
Geron
Corporation, the Nasdaq-US Index and the Nasdaq-Pharmaceutical Index(2)
(1) |
This Section is not soliciting material, is not deemed filed with the SEC and is not to be incorporated by reference in any filing of the Company under the Securities Act of 1933, or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. |
(2) |
Shows the cumulative total return on investment assuming an investment of $100 in each of the Company, the Nasdaq-US and the Nasdaq-Pharmaceutical on December 31, 1999. The cumulative total return on the Companys stock has been computed based on a price of $12.625 per share, the price at which the Companys shares closed on December 31, 1999. |
18
AUDIT COMMITTEE REPORT(1)
|
maintenance by management of the reliability and integrity of the accounting policies and financial reporting and financial disclosure practices of the Company; |
|
establishment and maintenance by management of processes to assure that an adequate system of internal controls is functioning within the Company; and |
|
retention and termination of the independent auditors. |
1) |
The Audit Committee has reviewed and discussed the audited financial statements of the Company as of and for the year ended December 31, 2004 with management and the independent auditors. |
2) |
The Audit Committee has discussed with the independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61 (Communication with Audit Committees), other professional standards, membership provisions of the SEC Practice Session, and other SEC rules, as currently in effect. |
3) |
The Audit Committee has received the written disclosures and the letter from the independent auditors required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees), as currently in effect, and it has discussed with the auditors their independence from the Company. |
(1) |
This Section is not soliciting material, is not deemed filed with the SEC and is not to be incorporated by reference in any filing of the Company under the Securities Act of 1933, or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. |
19
4) |
The Audit Committee has considered whether the independent auditors provision of non-audit services to the Company is compatible with maintaining the auditors independence. |
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Audit Fees and All Other Fees
Fiscal Year Ended December 31, 2004 |
Fiscal Year Ended December 31, 2003 |
|||||||||
---|---|---|---|---|---|---|---|---|---|---|
Audit
Fees |
$ | 420,204 | $ | 283,835 | ||||||
Audit of our annual consolidated financial statements; |
||||||||||
Reviews of our quarterly consolidated financial statements included in our Quarterly Reports on Forms 10-Q;
and |
||||||||||
Services provided in connection with SEC filings, including consents and comfort letters |
||||||||||
Audit Related
Fees |
60,066 | 11,050 | ||||||||
Consultations on accounting and auditing matters related to proposed transactions; and |
||||||||||
Consultation on compliance requirements related to Section 404 of the Sarbanes-Oxley Act of 2002 |
||||||||||
Tax
Fees |
13,943 | | ||||||||
All Other
Fees |
1,500 | |
20
CORPORATE GOVERNANCE
Code of Conduct
The Board of Directors
Section 16(a) Beneficial Ownership Reporting Compliance
21
Stockholder Nominations and Proposals for 2006 Annual Meeting
(i) |
experience in corporate management, such as serving as an officer or former officer of a publicly held company, and a general understanding of marketing, finance and other elements relevant to the success of a publicly traded company in todays business environment; |
(ii) |
experience in the Companys industry and with relevant social policy concerns; |
(iii) |
experience as a board member of another publicly held company; |
(iv) |
academic expertise in an area of the Companys operations; and |
(v) |
practical and mature business judgment, including ability to make independent analytical inquiries. |
22
OTHER MATTERS
March 15, 2005
23
APPENDIX A
GERON CORPORATION
AMENDED AND RESTATED AUDIT COMMITTEE CHARTER
AS
ADOPTED ON MARCH 11, 2005
I. | Purpose |
|
Serve as an independent and objective party to monitor the Companys financial reporting process and internal control system and report the results of its activities to the Board. |
|
Review and appraise the audit and review efforts of the Companys independent auditors. |
|
Provide a free and open avenue of communication among the independent auditors, financial and senior management, employees, and the Board of Directors. |
II. | Composition |
|
The Director is not currently an employee of the Company and has not been an employee in the last five years. |
|
The Director is not and has not in the past five years been part of an interlocking directorate in which the CEO or other executive officer of the Company serves on the compensation committee of another corporation that employs the Director. |
|
The Director is not a paid consultant to the Company, and receives no consulting, advisory, or other compensatory fee from the Company other than for service as a Director and/or a member of Board committees. |
|
The Director is not an immediate family member of a person who is or in the past five years was an employee of the Company, a part of such an interlocking directorate, a paid consultant or a recipient of any such compensatory fee. |
A-1
III. | Meetings |
IV. | Responsibilities and Duties |
1. | Oversight of Independent Auditors. |
A. |
Discuss with the independent auditors the overall scope and plans for their audits, including the adequacy of staffing and compensation. |
B. |
Be directly responsible for the appointment and termination, compensation, and oversight of the work of the independent auditors, including resolution of any disagreements between management and the auditors regarding financial reporting. |
C. |
Approve, in advance, all audit and non-audit services performed by the independent auditors not related to the annual audit or quarterly reviews of the Companys financial statements. The Company shall not engage the independent auditors to perform the specific non-audit services proscribed by law or regulation. The Committee may delegate pre-approval authority to a member of the Committee, provided that any decisions made by the delegate must be presented to the full Committee at its next scheduled meeting. |
D. |
At least annually, obtain and review a report by the independent auditors describing: |
|
The independent auditing firms internal quality control procedures; |
|
Any material issues raised by the most recent internal quality control review or peer review of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; and |
|
All relationships between the independent auditor and the Company. |
E. |
Set clear policies, in compliance with SEC regulations and stock exchange listing standards, for the Companys employment of employees or former employees of the independent auditors. |
A-2
2. | Review of Financial Statements. |
A. |
Review and discuss the Companys annual financial statements, earnings press releases, any earnings guidance provided to analysts and rating agencies, and other reports or financial information submitted to any governmental body or the public in connection with such annual financial statements, including any certification, report, opinion, or review rendered by the independent auditors. |
B. |
Review with management and the independent auditors the financial statements and disclosures under Managements Discussion and Analysis of Financial Condition and Results of Operations to be included in the Companys Annual Report on Form 10-K prior to its filing, including their judgment about the quality and acceptability of the Companys accounting principles, the reasonableness of significant judgments, the clarity of the disclosures, and the degree of aggressiveness or conservatism of the Companys accounting principles and underlying estimates. The Committee shall discuss the results of the annual audit and any other matters required to be communicated to the Committee by the independent auditors under generally accepted auditing standards. |
C. |
Following completion of the annual audit, review separately with management and with the independent auditors any significant difficulties encountered during the audit, including any restrictions experienced by the auditors on the scope of their work or access to required information. |
D. |
Review any significant disagreement among management, non-management employees and the independent auditors in connection with the preparation of the Companys annual financial statements. |
E. |
Review managements periodic statement concerning its assessment of the effectiveness of internal controls and the independent auditors report on managements statement. |
F. |
Prepare a report to be included in the Companys annual proxy statement, as required by SEC regulations. |
G. |
Report the results of the annual audit to the Board of Directors. If requested by the Board, invite the independent auditors to attend the full Board of Directors meeting to assist in reporting the results of the annual audit or to answer other Directors questions |
H. |
Review with management and the independent auditors the interim financial statements and disclosures under Managements Discussion and Analysis of Financial Condition and Results of Operations to be included in the Companys Quarterly Report on Form 10-Q prior to its filing. The Committee shall discuss the results of the quarterly review and any other matters required to be communicated to the Committee by the independent auditors under generally accepted auditing standards. The Chairman of the Committee may represent the entire Committee for purposes of this review and discussion. |
3. | Establishment and Oversight of Policy. |
A. |
Review with financial management and the independent auditors the results of their periodic analysis of significant financial reporting issues and practices, including changes in accounting principles and disclosure practices. |
B. |
Receive regular reports from the independent auditors on the critical policies and practices of the Company, and on alternative treatments of financial information that are within generally accepted accounting principles and that the independent auditors have discussed with management. |
C. |
Consider and approve, if appropriate, significant changes to the Companys auditing and accounting principles and practices as suggested by the independent auditors, management, or non-management employees. |
D. |
At an appropriate time after the Committee has approved changes or improvements in financial or accounting practice, review with the independent auditors and management the extent to which such changes or improvements have been implemented. |
A-3
E. |
To the extent not already established, establish regular and separate systems of reporting to the Committee by each of management and the independent auditors regarding significant judgments made in the preparation of the Companys financial statements and the view of each as the appropriateness of such judgments. |
F. |
Review with the independent auditors and management the adequacy and effectiveness of the Companys accounting, financial, disclosure and other controls, both internal and external, of the Company, including the Companys policies and procedures to assess, monitor, and manage business risk and the Companys legal and ethical compliance programs, and elicit any recommendations for the improvement of such internal control procedures or particular areas where new or more detailed controls or procedures are desirable. Particular emphasis should be given to the adequacy of such internal controls to expose any payments, transactions, or procedures that might be deemed illegal or otherwise improper. |
4. | Review of Compliance. |
A. |
Establish, review periodically and update as necessary a Code of Ethical Conduct, ensure that management has established a system to enforce the Code, and review managements monitoring of the Companys compliance with the Code. |
B. |
Review the adequacy of and managements implementation and monitoring of the Companys review system to ensure that the Companys financial statements, reports and other financial information disseminated to governmental organizations and the public satisfy legal requirements. |
C. |
Receive from the Companys counsel reports of evidence of material violations of securities laws or breaches of financial duties and review the Companys compliance policies and practices, including corporate securities trading policies. |
D. |
Review with the Companys counsel any legal matters that could have a significant impact on the Companys financial statements. |
E. |
Establish procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters and for the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters. |
5. | General Responsibilities. |
A. |
Review and update this Charter periodically as conditions dictate. |
B. |
Periodically, meet separately with management and the independent auditors to discuss issues and concerns warranting Committee attention. The Committee shall provide sufficient opportunity for the independent auditors to meet privately with the members of the Committee. The Committee shall review with the independent auditor any audit problems or difficulties and managements response. |
C. |
Review all related party transactions on an ongoing basis and all such transactions must be approved by the Committee. |
D. |
Perform an evaluation of the Committees own performance at least annually to determine whether it is functioning effectively. |
E. |
Perform any other activities consistent with this Charter, the Companys By-laws, and governing law, as the Committee or the Board deems necessary or appropriate. |
A-4
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Geron Corporation, a Delaware corporation (the Company), hereby acknowledges receipt of the Notice of Annual Meeting of Stockholders and Proxy Statement, each dated March 15, 2005, and hereby appoints Thomas B. Okarma and David L. Greenwood, or any of them, as proxies and attorneys-in-fact with full power to each of substitution, on behalf and in the name of the undersigned to represent the undersigned at the 2005 Annual Meeting of Stockholders of Geron Corporation to be held on May 6, 2005, at 8:30 a.m. local time, at the Companys headquarters at 230 Constitution Drive, Menlo Park, CA 94025 and at any adjournment(s) or postponement(s) thereof, and to vote all shares of common stock that the undersigned would be entitled to vote if then and there personally present, on the matters set forth on the reverse side, and in their discretion, upon such other matter or matters that may properly come before the meeting and any adjournment(s) or postponement(s) thereof.
This proxy will be voted as directed or, if no contrary direction is indicated, will be voted as follows: (1) for the election of one Class III Director to hold office until the Annual Meeting of Stockholders in the year 2008; (2) to ratify appointment of Ernst & Young LLP as the Companys independent auditors for the fiscal year ending December 31, 2005; and as said proxies deem advisable on such other matters as may come before the meeting and any adjournment(s) or postponement(s) thereof.
[X] Please mark your votes as in this example.
1. | Election of Class III Director. |
Nominee: Alexander E. Barkas |
[ ] FOR all nominees (except as indicated) [ ] WITHHOLD authority to vote for all nominees |
If you wish to withhold authority to vote for any individual nominee, strike a line through that individual's name. |
2. | To ratify appointment of Ernst & Young LLP as the Company's independent auditors for the fiscal year ending December 31, 2005. |
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. | As said proxies deem advisable on such other matters as may come before the meeting and any adjournment(s) or postponement(s) thereof. |
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE.
Note: This proxy should be marked, dated, signed by the stockholder(s) exactly as his or her name appears hereon, and returned in the enclosed envelope. |
SIGNATURE(s):_______________________ |
DATE:______________________________ |
Please sign exactly as name(s) appears hereon. When shares are held by joint tenants, both should sign. When signing as attorney, executor, administrator, trustee, or guardian, please give full title as such. If a corporation, please sign in full corporate name by President or other authorized officer. If a partnership, please sign in partnership name by authorized person. |
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