DEF 14A 1 gkos-20210603xdef14a.htm DEF 14A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by the Registrant

Filed by a Party other than the Registrant

Check the appropriate box:

Preliminary Proxy Statement

Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Under §240.14a-12

GLAUKOS CORPORATION

(Name of Registrant as Specified In Its Charter)

Not applicable

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

 

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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

Thursday, June 3, 2021
9:00 a.m. Pacific Time

How to Participate:

   

Our annual meeting will be a completely virtual meeting of stockholders. To participate, vote or submit questions during the annual meeting via live webcast, please visit: www.virtualshareholdermeeting.com/GKOS2021. You will not be able to attend the annual meeting in person.

Items of Business:

(1)   Elect the three director nominees named in the accompanying Proxy Statement to serve as directors until the Company’s 2024 annual meeting of stockholders and until their respective successors are duly elected and qualified;

(2)   Approve, on an advisory basis, the compensation of the Company’s named executive officers;

(3)   Ratify the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2021; and

(4)   Transact such other business as may properly come before the meeting or any postponements or adjournments thereof.

Who May Vote:

Stockholders of record at the close of business on April 8, 2021.

TOCKHOLDER LIST

STOCKHOLDER LIST:

A list of stockholders as of the record date for the annual meeting may be accessed during the virtual annual meeting at www.virtualshareholdermeeting.com/GKOS2021 by using the 16-digit control number on your Notice of Internet Availability of Proxy Materials, or on your proxy card or voting instruction form that accompanied your proxy materials.

Your vote is important to us. Whether or not you expect to attend the annual meeting via live webcast, please submit a proxy as soon as possible to instruct how your shares are to be voted at the annual meeting. If you participate in and vote your shares at the annual meeting, your proxy will not be used.

By Order of the Board of Directors,

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Description automatically generated

Thomas W. Burns

President & Chief Executive Officer


TABLE OF CONTENTS

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

Important Notice Regarding Internet Availability of Proxy Materials

1

Meeting Information

2

Virtual Annual Meeting

3

Proposal 1 — Election of Directors

4

Corporate Governance

15

Executive Officers of the Company

28

Proposal 2 — Advisory Approval of Named Executive Officer Compensation

29

Executive Compensation

30

Compensation Discussion and Analysis

30

Compensation Committee Report

46

Summary Compensation Table for Fiscal Years 2020, 2019 and 2018

47

Executive Employment Offer Letters

48

2020 Grants of Plan-Based Awards

49

Outstanding Equity Awards at 2020 Fiscal Year-End

50

Option Exercises and Stock Vested in Fiscal 2020

51

Nonqualified Deferred Compensation Plans

51

Potential Payments Upon Termination or Change in Control

52

Employee Benefit and Stock Plans

54

Compensation Committee Interlocks and Insider Participation

58

CEO Pay Ratio

58

Director Compensation

59

Equity Compensation Plan Information

62

Security Ownership of Certain Beneficial Owners and Management

63

Report of the Audit Committee

66

Proposal 3 — Ratification of Independent Registered Public Accounting Firm

67

Transactions with Related Persons

69

Proposals of Stockholders and Director Nominations for 2022 Annual Meeting

70

Other Matters

71

Annual Report to Stockholders

71

Questions and Answers About the Proxy Materials and Annual Meeting

72


Forward-Looking Statements.

All statements other than statements of historical facts included in this Proxy Statement that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. Although we believe that we have a reasonable basis for forward-looking statements contained herein, we caution you that they are based on current expectations about future events affecting us and are subject to risks, uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control, that may cause our actual results to differ materially from those expressed or implied by forward-looking statements in this press release. Risks, uncertainties and factors related to Glaukos and our business are described in detail under the caption “Risk Factors” and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2020, which was filed with the Securities and Exchange Commission on March 1, 2021. We do not undertake any obligation to update, amend or clarify these forward-looking statements whether as a result of new information, future events or otherwise, except as may be required under applicable securities law.


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229 Avenida Fabricante
San Clemente, California 92672

PROXY STATEMENT

Annual Meeting of Stockholders

To Be Held June 3, 2021

Our Board of Directors is soliciting your proxy for the 2021 Annual Meeting of Stockholders (the “Annual Meeting”) to be held on Thursday, June 3, 2021, at 9:00 a.m. Pacific Time, and at any and all postponements or adjournments of the Annual Meeting, for the purposes set forth in the Notice of Annual Meeting of Stockholders accompanying this Proxy Statement. This Proxy Statement and our 2020 Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Annual Report”) are first being made available to stockholders on or about April 22, 2021.

We will be hosting the Annual Meeting via live webcast on the Internet. Any stockholder can listen to and participate in the Annual Meeting live via the Internet at www.virtualshareholdermeeting.com/GKOS2021. Stockholders may vote and ask questions while connected to the Annual Meeting on the Internet.

You will not be able to attend the Annual Meeting in person.

Unless the context otherwise requires, references in this Proxy Statement to “Company,” “we,” “our,” “us,” and similar terms refer to Glaukos Corporation, a Delaware corporation. In addition, all references to our website in this Proxy Statement are provided for convenience only and the content on our website does not constitute a part of this Proxy Statement.

9 Annual Report on Form 10-K are available on the Internet at www.proxyvote.com. These materials are also available on our corporate website at http://investors.glaukos.com. The other information on our corporate website does not constitute part of this Proxy Statement.

IMPORTANT NOTICE REGARDING INTERNET AVAILABILITY OF PROXY MATERIALS

This Proxy Statement and our 2020 Annual Report on Form 10-K are available on the Internet at www.proxyvote.com. These materials are also available on our corporate website at http://investors.glaukos.com.

GLAUKOS CORPORATION  |  2021 PROXY STATEMENT   1


MEETING INFORMATION

Annual Meeting of Stockholders

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TIME AND DATE

PLACE

RECORD DATE

9:00 a.m. Pacific Time

on Thursday, June 3, 2021

The Annual Meeting will be hosted
via live webcast on the Internet at www.virtualshareholdermeeting.com/GKOS2021.

April 8, 2021

How to Vote

Stockholders as of the close of business on the record date are entitled to vote. If you are a beneficial owner who owns shares of our common stock registered in the name of a broker, bank or other nominee, please follow the instructions they provide on how to vote your shares. Stockholders of record may vote as follows:

Before the Meeting:

See related image detail

By Telephone. Vote by telephone by calling 1-800-690-6903.

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Via the Internet. Vote by Internet at
www.proxyvote.com.

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By Mail. Complete and return each proxy card received in the prepaid envelope.

During the Meeting:

. Vote by Internet at
www.proxyvote.com. Proxies submitted through the Internet must be received by 11:59 p.m., Eastern Time, on June 2, 2021.

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Via the Internet. Vote during the meeting by Internet at www.virtualshareholdermeeting.com/GKOS2021.

Voting Matters

PROPOSALS

BOARD
RECOMMENDATION

1

 

Election of Directors

 

FOR ALL
director nominees

2

Approve, on an Advisory Basis, the Compensation of the Company’s Named Executive Officers.

FOR

3

Ratification of Independent Registered Public Accounting Firm

FOR

2   2021 PROXY STATEMENT  |  GLAUKOS CORPORATION


VIRTUAL ANNUAL MEETING

We will be hosting the Annual Meeting live via the Internet. You will not be able to attend the Annual Meeting in person. Any stockholder can listen to and participate in the Annual Meeting live via the Internet at www.virtualshareholdermeeting.com/GKOS2021. Our Board annually considers the appropriate format of our annual meeting. The virtual meeting will allow our stockholders to attend and participate from any location around the world. This format will enhance stockholder access and encourage participation and communication with our Board of Directors and management.

The Annual Meeting webcast will begin promptly at 9:00 a.m., Pacific Time. We encourage you to access the Meeting webcast prior to the start time. Online check-in will begin, and stockholders may begin submitting written questions, at 8:45 a.m., Pacific Time, and you should allow ample time for the check-in procedures.

Benefits of a Virtual Annual Meeting

We are embracing technology to provide expanded access, improved communication, reduced environmental impact and cost savings for our stockholders and the Company. Hosting a virtual meeting enables increased stockholder attendance and participation since stockholders can participate and ask questions from any location around the world, and provides us an opportunity to give thoughtful responses. In addition, we intend that the virtual meeting format provide stockholders a similar level of transparency to the traditional in-person meeting format and we take steps to ensure such an experience. Our stockholders will be afforded the same opportunities to participate at the virtual Annual Meeting as they would at an in-person annual meeting of stockholders.

Attendance at the Virtual Annual Meeting

You will need the control number included on your Notice of Internet Availability or your proxy card or voting instruction form (if you received a printed copy of the proxy materials) or included in the email to you if you received the proxy materials by email in order to be able to vote your shares or submit questions during the Annual Meeting. Instructions on how to connect to the Annual Meeting and participate via the Internet, including how to demonstrate proof of stock ownership, are posted at www.virtualshareholdermeeting.com/GKOS2021. If you do not have your control number, you will be able to access and listen to the Annual Meeting but you will not be able to vote your shares or submit questions during the Annual Meeting.

We will have technicians ready to assist you with any technical difficulties you may have accessing the virtual meeting or submitting questions. 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 Virtual Shareholder Meeting log in page.

Questions at the Virtual Meeting

Our virtual annual meeting allows stockholders to submit questions and comments before and during the meeting. After the meeting, we will spend up to 15 minutes answering stockholder questions that comply with the meeting rules of conduct; the rules of conduct will be posted on the virtual meeting web portal. To the extent time doesn’t allow us to answer all of the appropriately submitted questions, we will answer them in writing on our investor relations website, at www.investors.glaukos.com, soon after the meeting. If we receive substantially similar questions, we will group such questions together and provide a single response to avoid repetition.

GLAUKOS CORPORATION  |  2021 PROXY STATEMENT   3


PROPOSAL 1 — ELECTION OF DIRECTORS

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR ALL” OF THE DIRECTOR NOMINEES. UNLESS OTHERWISE INSTRUCTED, THE PROXY HOLDERS WILL VOTE THE PROXIES RECEIVED BY THEM “FOR ALL” THE DIRECTOR NOMINEES.

Our Board of Directors (“Board” or “Board of Directors”) is currently comprised of nine directors. Under our Certificate of Incorporation, our Board of Directors is divided into three classes, each serving a staggered three-year term and with one class being elected at each year’s annual meeting of stockholders as follows:

the Class I directors are Mark J. Foley, Gilbert H. Kliman, M.D. and David F. Hoffmeister, and their terms will expire at the 2022 annual meeting of stockholders;

the Class II directors are William J. Link, Ph.D., Aimee S. Weisner and Denice M. Torres, and their terms will expire at the 2023 Annual Meeting; and

the Class III directors are Thomas W. Burns, Leana S. Wen, M.D. and Marc A. Stapley, and their terms will expire at the Annual Meeting.

Upon the recommendation of the Compensation, Nominating and Corporate Governance Committee (the “Compensation Committee”), the Board of Directors has nominated each of Thomas W. Burns, Leana S. Wen, M.D. and Marc A. Stapley for election to our Board of Directors as Class III directors to serve until the 2024 annual meeting of stockholders and until their respective successors are duly elected and qualified. Proxies may only be voted for the three Class III directors nominated for election at the Annual Meeting.

Each of the director nominees has consented to being named in this Proxy Statement and to serving as a director, if elected. We have no reason to believe that any of the nominees will be unable or unwilling for good cause to serve if elected. However, if any nominee should become unable for any reason or unwilling for good cause to serve, the proxy holders will vote the proxies received by them for another person nominated as a substitute by the Board of Directors, or the Board of Directors may reduce the number of directors on the Board.

Biographical Descriptions

Set forth below is biographical information about each of our directors and director nominees. The information below is provided as of April 8, 2021. The primary experience, qualifications, attributes and skills of each of our director nominees that led to the conclusion of the Compensation Committee and the Board of Directors that such nominee should serve as a member of the Board of Directors are also described below.

4   2021 PROXY STATEMENT  |  GLAUKOS CORPORATION


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

Nominees for Election as Class III Directors at the Annual Meeting

THOMAS W. BURNS

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Class III

Age: 60

Director Since:
2002

POSITION AND BUSINESS EXPERIENCE

Mr. Burns has served as our President, Chief Executive Officer and as a member of our Board of Directors since March 2002. Mr. Burns has a proven record of building successful medical device and pharmaceutical businesses and creating successful new markets in ophthalmology. Mr. Burns has more than 25 years of direct ophthalmic management experience, including over 20 years of general management experience across a broad range of ophthalmic medical devices and pharmaceuticals, drug delivery technologies, surgical products and over-the-counter products. Prior to joining our Company, Mr. Burns led Eyetech Pharmaceuticals, Inc. (acquired by OSI Pharmaceuticals, Inc.) as its president and chief operating officer and as a director. From 1990 to 1997, Mr. Burns served as senior vice president and general manager of Chiron Vision Corporation (acquired by Bausch & Lomb, Inc.), and then as vice president, global strategy and general manager, refractive surgery, of Bausch & Lomb from 1998 to 2000. In September 2020, Mr. Burns joined the board of directors of Pulmonx Corporation (Nasdaq: LUNG), where he serves on the compensation committee. During 2018 and 2019, Mr. Burns served as a director and as chairman of the compensation committee of the board of Avedro, Inc., until his resignation on August 6, 2019, prior to its acquisition by Glaukos. Mr. Burns has also served as an entrepreneur in residence at Versant Ventures Management, LLC. Mr. Burns received a B.A. from Yale University.

BOARD QUALIFICATIONS

We believe Mr. Burns’ extensive understanding of our business, operations and strategy, as well as significant industry experience and corporate management skills and experience, qualify him to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Other Public Company Board Service

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Accounting and Auditing

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Capital Management

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Mergers and Acquisitions

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Regulatory & Risk Management

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Legal and Human Capital Management

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International Commercialization

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Medtech

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Ophthalmology

GLAUKOS CORPORATION  |  2021 PROXY STATEMENT   5


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

LEANA S. WEN, MD

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Class III

Age: 38

Director Since:

2021

POSITION AND BUSINESS EXPERIENCE

Dr. Wen is an emergency physician and has served as a visiting professor of health policy and management at the George Washington University School of Public Health since September 2019. She has been a contributing columnist for The Washington Post since June 2020, writing on health policy and public health, and an on-air commentator for CNN as a medical analyst since August 2020. From January 2015 to October 2018, she was the health commissioner for the city of Baltimore, where she led the nation’s oldest continuously operating health department to combat the opioid epidemic and improve maternal and child health. From 2013 to 2015, Dr. Wen served as director of patient-centered care research in the department of emergency medicine at George Washington University, and authored a critically-acclaimed book on patient advocacy. She is currently on the board of the Bipartisan Policy Center and the Baltimore Community Foundation, and chairs the advisory board of the Behavioral Health Group. She has also been a global health fellow at the World Health Organization, a consultant with the China Medical Board, and a nonresident senior fellow at the Brookings Institution. Dr. Wen also served as the President of Planned Parenthood from 2018 through 2019. She has been a member of more than ten nonprofit boards, including serving as the chair of Behavioral Health Systems Baltimore. Dr. Wen’s work has been recognized by numerous professional organizations, including as one of Modern Healthcare’s Top 50 Physician-Executives, and, in 2019, she was named one of TIME magazine’s 100 Most Influential People. She holds a B.S. from California State University, Los Angeles, an M.D. from Washington University School of Medicine and two M.Sc.s from the University of Oxford, where she was a Rhodes Scholar. She completed her residency training at Brigham & Women’s Hospital and Massachusetts General Hospital, where she was a clinical fellow at Harvard Medical School.

BOARD QUALIFICATIONS

We believe Dr. Wen’s experience as a practicing physician, combined with her extensive experience working in governmental sectors, with innovative health companies, and serving on nonprofit boards and foundations, make her a qualified member of our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Sustainability

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Regulatory & Risk Management

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Legal and Human Capital Management

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Public Health Policy

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Medtech

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Pharmaceutical

6   2021 PROXY STATEMENT  |  GLAUKOS CORPORATION


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

MARC A. STAPLEY

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Class III

Age: 51

Director Since:
2014

POSITION AND BUSINESS EXPERIENCE

Mr. Stapley has served as a member of our Board of Directors since 2014. He is the Chairman and CEO of Helix, a population genomics company, a position he has held since 2019. Prior to Helix, he was the executive vice president, strategy and corporate development at Illumina, Inc., where he was responsible for corporate strategy, corporate and business development and global infrastructure, from 2017 to January 2019. Previously, Mr. Stapley served as Illumina’s chief administrative officer, senior vice president and chief financial officer. He was also a member of Illumina’s executive management team, responsible for directing all aspects of the company’s strategy, planning and operations. Before joining Illumina in 2012, from 2009 to 2012, Mr. Stapley was senior vice president, finance at Pfizer Inc. and was responsible for global financial processes and systems, leading integration efforts in both the Wyeth Ltd. and King Pharmaceutical, Inc. acquisitions and providing oversight to the company’s largest technology investment program. Prior to Pfizer, he served in a variety of senior finance roles at Alcatel-Lucent, including Americas chief financial officer. He also worked as finance director and controller for several groups at Cadence Design Systems, Inc. He began his career as an Auditor at Coopers & Lybrand. Mr. Stapley is currently a member of the board of directors for Helix. He also serves on the boards of Immunis.AI, a privately held immunogenomics company, and Premier Foods, Inc., a private restaurant chain. He holds a B.Sc. (Honors) from The University of Reading (England) and is a member of the Institute of Chartered Accountants in England and Wales.

BOARD QUALIFICATIONS

We believe Mr. Stapley’s extensive experience in senior finance positions with public companies qualifies him to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Accounting and Auditing

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Capital Management

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Sustainability

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Mergers and Acquisitions

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Regulatory & Risk Management

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Legal and Human Capital Management

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International Commercialization

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Medtech

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Pharmaceutical

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Cybersecurity

GLAUKOS CORPORATION  |  2021 PROXY STATEMENT   7


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

All Other Continuing Directors

MARK J. FOLEY

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Class I

Age: 55

Director Since:

2014

POSITION AND BUSINESS EXPERIENCE

Mr. Foley is currently the president and chief executive officer of Revance Therapeutics, Inc. (Nasdaq: RVNC), a position to which he was appointed in October 2019 after serving on the board of directors since 2017. Previously, he was the chairman, president and chief executive officer of ZELTIQ Aesthetics, Inc., a medical technology company, up until its acquisition by Allergan plc in April 2017. Prior to becoming ZELTIQ’s chief executive officer in 2012, Mr. Foley served on the board of directors having joined the company as its executive chairman in 2009. Mr. Foley also served as chairman of Arrinex from 2018 until the company's acquisition by Stryker in 2019, chairman of HintMD until its acquisition in 2020 and executive chairman at Onpharma Inc. from 2009 until its acquisition by Valeant Pharmaceuticals International, Inc. in 2014. Mr. Foley also served as a managing director at RWI Ventures, Inc. from 2004 to 2018, where he focused on healthcare investments. Prior to this, Mr. Foley held a variety of operating roles in large, public companies and venture-backed startups including United States Surgical Corporation, Guidant Corporation, Devices for Vascular Intervention, Inc. (acquired by Eli Lilly and Company), Perclose, Inc. (acquired by Abbott Laboratories) and Ventrica, Inc. (acquired by Medtronic, Inc.) where he was the founder and chief executive officer. Mr. Foley has over 25 years of medical device operating, investment and chief executive officer experience. In addition to his service on the Revance and Glaukos boards, Mr. Foley sits on the board of directors of SI-Bone, Inc. (Nasdaq: SIBN). Mr. Foley holds a B.A. from the University of Notre Dame.

BOARD QUALIFICATIONS

We believe Mr. Foley’s previous medical device experience as a senior executive and his service on the boards of several medical device companies qualify him to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Other Public Company Board Service

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Accounting and Auditing

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Capital Management

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Sustainability

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Mergers and Acquisitions

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Regulatory & Risk Management

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Legal and Human Capital Management

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International Commercialization

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Medtech

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Pharmaceutical

8   2021 PROXY STATEMENT  |  GLAUKOS CORPORATION


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

DAVID F. HOFFMEISTER

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Class I

Age: 66

Director Since:

2014

POSITION AND BUSINESS EXPERIENCE

Mr. Hoffmeister served as the senior vice president and chief financial officer of Life Technologies Corporation, a global life sciences company, prior to its acquisition by Thermo Fisher Scientific Inc. in February 2014. From October 2004 to November 2008, he served as chief financial officer of Invitrogen Corporation, which merged with Applied Biosystems Inc. in November 2008 to form Life Technologies Corporation. Before joining Invitrogen, Mr. Hoffmeister spent 20 years with McKinsey & Company as a senior partner serving clients in the healthcare, private equity and chemical industries on issues of strategy and organization. From 1998 to 2003, Mr. Hoffmeister was the leader of McKinsey’s North American chemical practice. Mr. Hoffmeister currently serves on the boards of directors of Celanese Corporation (NYSE: CE), where he serves as a member of the audit and the nominating and corporate governance committees, ICU Medical, Inc. (Nasdaq: ICUI),where he serves as a member of the audit and the compensation committees, StepStone Group Inc. (Nasdaq: STEP), where he serves as the chair of the audit committee, and Kaiser Permanente. Mr. Hoffmeister holds a B.S. from the University of Minnesota and an M.B.A. from the University of Chicago.

BOARD QUALIFICATIONS

We believe Mr. Hoffmeister’s strong finance background, experience as a chief financial officer of a global biotechnology company, and public company board experience qualify him to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Other Public Company Board Service

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Accounting and Auditing

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Capital Management

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Mergers and Acquisitions

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Medtech

GLAUKOS CORPORATION  |  2021 PROXY STATEMENT   9


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

GILBERT H. KLIMAN, M.D.

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Class I

Age: 62

Director Since:

2007

POSITION AND BUSINESS EXPERIENCE

Dr. Kliman previously served on our Board from 2007 until his resignation on August 6, 2019 prior to the Company’s acquisition of Avedro, upon which board of directors he also served. In March 2020, Dr. Kliman was reappointed to the Board. Dr. Kliman has been a partner of InterWest Partners, a venture capital firm, since 1996, and has been a managing director there since 1999. From 1995 to 1996, Dr. Kliman was an investment manager at Norwest Venture Partners, a venture capital firm. From 1989 to 1992, Dr. Kliman served as an associate at TA Associates, a private equity investment firm. Dr. Kliman is a board-certified ophthalmologist and completed a retina research fellowship at Massachusetts Eye and Ear Infirmary and residency training at Wills Eye Hospital. Dr. Kliman holds a B.A. from Harvard University, an M.D. from the University of Pennsylvania and an M.B.A. from the Stanford Graduate School of Business. Since June 2020, Dr. Kliman has served on the board of directors of Staar Surgical Company (Nasdaq: STAA), where he is both chair of the nominating and governance committee and a member of the compensation committee. He also serves as a director of a number of private life science and healthcare IT companies, and as a director on the executive board of ORBIS International, a global nonprofit focused on preventing avoidable blindness. In addition to previously serving as a director of Avedro from 2015 until his resignation in 2019, Dr. Kliman also previously served on the board of directors of Restoration Robotics (Nasdaq: HAIR) from July 2007 until its acquisition by Venus Concept Inc. in November 2019. Dr. Kliman served on the board of directors of Epocrates, Inc. (acquired by athenahealth, Inc.) from 1999 to 2011, and IntraLase Corp. (acquired by Advanced Medical Optics, Inc.) from 2000 to 2007.

BOARD QUALIFICATIONS

We believe Dr. Kliman’s prior experience as a practicing ophthalmologist, as well as his significant experience in financial markets and prior experience on the board of several U.S. public companies and various private healthcare companies, qualify him to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Other Public Company Board Service

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Accounting and Auditing

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Capital Management

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Mergers and Acquisitions

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International Commercialization

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Medtech

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Ophthalmology

10   2021 PROXY STATEMENT  |  GLAUKOS CORPORATION


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

AIMEE S. WEISNER

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Class II

Age: 52

Director Since:

2014

POSITION AND BUSINESS EXPERIENCE

Ms. Weisner was corporate vice president, general counsel of Edwards Lifesciences Corporation from 2011 until her retirement in 2019. From 2009 to 2010, she was engaged in private practice and served as legal advisor to public pharmaceutical and medical device companies located in Southern California. Prior to this, from 2002 to 2009, Ms. Weisner served in a number of positions at Advanced Medical Optics, Inc. (acquired by Abbott Laboratories), including executive vice president, administration and secretary. From 1998 to 2002, Ms. Weisner served in a number of positions at Allergan, Inc., including vice president, assistant general counsel and assistant secretary. Ms. Weisner holds a B.A. from California State University, Fullerton, a J.D. from Loyola Law School, Los Angeles, and began her legal career as an associate at the law firm of O’Melveny & Myers LLP. Ms. Weisner has served on the board of directors of Oyster Point Pharma, Inc. (Nasdaq: OYST), including as a member of its audit committee, since October 2019 and on the board of directors of Lensar, Inc. (Nasdaq: LNSR), including as a member of its compensation committee, since February 1, 2021.

BOARD QUALIFICATIONS

We believe Ms. Weisner’s extensive in-house legal and compliance experience with different medical device companies, including an in-depth understanding of regulatory and reimbursement issues, intellectual property, corporate governance, risk management, corporate transactions, human resources, and internal audit, qualify her to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Other Public Company Board Service

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Sustainability

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Mergers and Acquisitions

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Regulatory & Risk Management

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Legal and Human Capital Management

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International Commercialization

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Medtech

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Ophthalmology

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Pharmaceutical

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Cybersecurity

GLAUKOS CORPORATION  |  2021 PROXY STATEMENT   11


Table of Contents

PROPOSAL 1 — ELECTION OF DIRECTORS

WILLIAM J. LINK, Ph.D.

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Class II

Age: 75

Director Since:

2001

POSITION AND BUSINESS EXPERIENCE

Dr. Link has served as chairman of our Board of Directors since June 2001. Dr. Link has a proven record of building and operating large, successful medical product companies. He has extensive knowledge of medical devices and drug delivery, particularly in ophthalmology, and his operating experience spans 25 years in general management in the healthcare industry. Dr. Link is the managing partner of Flying L Partners, which invests in promising businesses in the ophthalmic sector. Dr. Link is also a managing director and co-founder of Versant Ventures Management LLC, a venture capital firm investing in early stage healthcare companies. Prior to co- founding Versant Ventures in 1999, Dr. Link was a general partner at Brentwood Venture Capital. From 1986 to 1997, Dr. Link was founder, chairman, and chief executive officer of Chiron Vision Corporation (acquired by Bausch & Lomb, Inc.). He also founded and served as President of American Medical Optics, Inc. (acquired by Allergan, Inc.). He has been a member of the board of directors of Edwards Lifesciences Corporation (NYSE: EW) since May 2009 (Dr. Link has announced he will retire from the Edwards board effective May 4, 2021), Oyster Point Pharma, Inc. (Nasdaq: OYST), since July 2015, Tarsus Pharmaceuticals, Inc. (Nasdaq: TARS) since January 2017, and Lensar, Inc. (Nasdaq: LNSR) since November 2017. Dr. Link served as a director of Advanced Medical Optics, Inc. (acquired by Abbott Laboratories) from 2002 to 2009, a director of Inogen, Inc. from 2003 to February 2014, and a director of Second Sight Medical Products, Inc. (Nasdaq: EYES) from 2004 through May 2020. Before entering the healthcare industry, Dr. Link was an assistant professor in the Department of Surgery at the Indiana University School of Medicine. Dr. Link holds a B.S., an M.S., and a Ph.D. in mechanical engineering from Purdue University.

BOARD QUALIFICATIONS

We believe Dr. Link’s experience in identifying new business opportunities and successfully commercializing products in the medical device industry, as well as his prior experience on the boards of U.S. public companies, qualify him to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Other Public Company Board Service

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Capital Management

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Sustainability

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Mergers and Acquisitions

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Regulatory & Risk Management

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Public Health Policy

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International Commercialization

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Medtech

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Ophthalmology

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Pharmaceutical

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PROPOSAL 1 — ELECTION OF DIRECTORS

DENICE M. TORRES

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Class II

Age: 61

Director Since:

2021

POSITION AND BUSINESS EXPERIENCE

Ms. Torres is currently chief executive officer of The Ignited Company, a Pennsylvania-based consulting firm she founded in 2017. From 2005 to 2017, she served in various senior leadership roles at Johnson & Johnson (J&J). From 2015 to 2017, she was chief strategy and transformation officer for J&J’s global medical device business, a $25 billion business with more than 50,000 employees. From 2011 to 2015, she was president of J&J McNeil Consumer Healthcare, where she led the recovery of OTC brands, including the iconic Tylenol portfolio, by transforming business operations, manufacturing, quality systems and commercialization approaches, and creating high levels of employee engagement across all functions of the business. From 2009 to 2011, she served as president of J&J Janssen Pharmaceuticals, Neuroscience. Before joining J&J, Ms. Torres built a successful, 14- year career at Eli Lilly and Company, where she focused on marketing and business unit management. In 2020, Ms. Torres joined the boards of venture-backed National Resilience, as well as public companies Karuna Therapeutics, Inc. (Nasdaq: KRTX), a clinical-stage biopharmaceutical company, and Bluebird Bio (Nasdaq: BLUE), where she also serves on the nominating and the compensation committees. She is also the founder of The Mentoring Place, a nonprofit organization offering free executive mentoring to help women achieve their career goals. Ms. Torres holds a B.S. in Psychology from Ball State University, a J.D. from Indiana University and an MBA from the University of Michigan. She is a member of the Michigan Bar Association.

BOARD QUALIFICATIONS

Ms. Torres has extensive experience in the pharmaceutical and medical device industries, including executive management of global commercialization, with different medical device companies, including responsibility for quality, strategy and marketing, which we believe qualifies her to serve on our Board of Directors.

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Executive Leadership

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Governance and Compliance

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Other Public Company Board Service

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Regulatory & Risk Management

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Legal and Human Capital Management

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International Commercialization

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Medtech

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Pharmaceutical

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Each of our directors’ specific skills and experiences are included in the table below and described more fully in their individual biographies. Even though a particular skill may not be indicated below, our directors often have some level of experience in each of the areas listed.

Business or Professional
Experience/Skills/Attributes

Importance

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Executive Leadership

The management skills to lead a complex and large, or growing, organization and its workforce is important to our operations and achieving our strategic goals.

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Governance and Compliance

A background or proficiency in corporate governance and compliance can help improve business processes, avoid reputational harm, increase employee morale and enhance business opportunities.

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Other Public Company Board Service

Experience as a board member of a public company board, particularly of a highly regulated organization like Glaukos, brings a viewpoint that is indispensable.

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Accounting and Auditing

A professional background in audit matters and financial reporting, including with respect to publicly-traded organizations, is important to the operations of our business.

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Capital Management

Experience in connection with managing and investing the assets of an organization is important to our continued success.

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Sustainability

Experience with sustainability is vital to the Company’s long-term growth in a manner that benefits the environment in which it operates.

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Mergers and Acquisitions

A background or proficiency with respect to mergers and acquisitions, particularly in the medtech or pharmaceutical industries, and long-term strategic planning is of utmost importance.

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Regulatory & Risk Management

Experience assessing and managing the risks and regulatory matters associated with a publicly-traded company, especially in the highly-regulated medical industry, is essential to our long-term success.

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Legal and Human Capital Management

An understanding of legal considerations and human capital management is key to maximizing the Company’s resources, improving employee performance and achieving better results.

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Public Health Policy

Experience with the decision-making process for implementing policy that affects the health of the patients we serve is important to our continued growth.

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International Commercialization

A background or proficiency with respect to making strategic decisions regarding future growth opportunities is essential.

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Medtech

Experience overseeing the development, commercialization, manufacture and sales of medical technology is valuable to the strategic planning and operations of the Company.

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Ophthalmology

An understanding of the diseases and treatments impacting vision and eye care is important to the leadership of the Company.

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Pharmaceutical

Experience overseeing the development, commercialization, manufacture and sales of pharmaceuticals is crucial as the Company expands into this space.

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Cybersecurity

Experience protecting proprietary and confidential data is vital to the development of the Company’s intellectual property.

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CORPORATE GOVERNANCE

Corporate Governance Guidelines

Our Board of Directors, on the recommendation of the Compensation Committee, has adopted Corporate Governance Guidelines to assist the Board in the discharge of its duties and to set forth the Board of Directors’ current views with respect to selected corporate governance matters considered significant to our stockholders. Our Corporate Governance Guidelines direct our Board’s actions with respect to, among other things, our Board composition and director qualifications, responsibilities of directors, director compensation, director orientation and continuing education, succession planning and the Board’s annual performance evaluation. A current copy of our Corporate Governance Guidelines is available under “Corporate Governance” on our website at http://investors.glaukos.com.

Stockholder Engagement and Responsiveness

3

70%

Stockholder Engagement

Since our IPO in 2015, we have conducted regular outreach to our stockholders to build relationships, explain our corporate governance structure and executive compensation policies, and receive valuable feedback on matters that are important to them.

At our 2020 Annual Meeting of Stockholders (“2020 Annual Meeting”), our stockholders approved, by a non-binding, advisory vote, the compensation of our Named Executive Officers. This ballot item, known as a “say-on-pay” proposal, passed by a 92% majority of the votes cast. Following the 2020 Annual Meeting, we engaged with our stockholders regarding our executive compensation policies and corporate governance principles. During this outreach, members of our management team spoke with stockholders (excluding officers and directors of the Company) collectively owning approximately 70% of our outstanding stock. Mr. Foley, chair of the Compensation Committee, joined some of these calls with our top stockholders. These included 9 of our top 10 stockholders. The Company’s Board of Directors, including all members of the Compensation Committee, was provided a full report of stockholder feedback from this 2020 stockholder engagement.

The stockholders with whom we spoke generally expressed broad support for our governance practices and understood the importance of having certain governance protections, such as a classified Board, for a company that has significant potential future shareholder value tied to its deep product pipeline as compared to commercialized products. Our stockholders also conveyed broad general support for our executive compensation program, stating their appreciation for the Company’s use of multi-year performance equity grants and its increased proportion of performance equity to time-based equity for our chief executive officer, with some investors noting their preference for longer performance-periods for performance-based equity grants.

Notably, most stockholders expressed support for the Company’s continuing environmental, social and governance (“ESG”) efforts, recognizing that we released our first Sustainability Report in 2020. Several stockholders expressed interest in seeing enhanced disclosure regarding Glaukos’ ESG commitment, including setting goals and targets that are material to the Company and its stakeholders, comprised of employees, customers, suppliers and investors. They also queried about any particular framework the Company was following in connection with its ESG program and disclosures. Additionally, some stockholders conveyed their desire to see the Company integrate ESG incentives into its compensation program, linking pay to achievement of our ESG initiatives. They noted their belief that the Company’s compensation structure should reflect the importance of ESG considerations to Glaukos and its stakeholders.

Nearly all of the stockholders with whom we engaged requested additional understanding regarding the Company’s promotion of diversity and inclusion within its workforce. They conveyed their preference to see

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more diverse and inclusive representation on the Company’s Board of Directors, as well as enhanced disclosure regarding the composition of the Company’s workforce and steps taken to ensure our workforce reflects our community and customer base. Several stockholders provided their opinion that expansion of skill sets among our Board members, including adding members with pharmaceutical experience, would benefit the Company as we expand from a solely medical device manufacturer to a pharmaceutical manufacturer as well. They also noted their desire for the Company to refresh its Board with new directors and reduce its overall average tenure of service on the Board.

Several of our stockholders informed us that they consider a Company’s equity burn rate when making investment and proxy voting decisions and want to ensure that ours remains comparable to that of our peer companies. Additionally, a couple of stockholders expressed their desire for the Company to provide greater transparency around the progress of our pipeline products, noting the importance of this information to their investment analysis process.

In response to stockholder feedback in 2019 and 2020, the Compensation Committee and Board responded by taking the following actions:

STOCKHOLDER RESPONSIVENESS

Stockholder Feedback

Responsive Action Taken

Impact of Action

Company should increase the diversity and inclusivity of its Board of Directors and disclose the composition of its workforce

    New Directors appointed to Board in 2021; both new directors are female and members of underrepresented communities; Company enhanced disclosure regarding workforce diversity in its 2020 Sustainability Report, and described efforts to address inclusivity efforts; Company formalized the Board’s oversight of diversity and inclusivity progress

Demonstrates Company’s belief that diverse perspectives and backgrounds create the greatest platform for innovation and value for the Company and its stockholders; provides stakeholders with visibility into Company’s diversity, equity and inclusion efforts and progress

Board should refresh its membership, bringing new areas of expertise including pharmaceutical experience, and reduce average tenure of Directors

    New Directors appointed to Board in 2021, bringing backgrounds in pharmaceutical, executive management and public health management and policy, critical areas of know-how as the Company expands its hybrid drug-device practice; with new members, average tenure of Directors reduced to 9 years

Brings necessary skills and experience to the oversight of the Company at a critical time to improve success of development of the Company pipeline product offerings; brings fresh viewpoints to Board from independent members

Company should continue to develop its ESG strategy, focusing on setting goals in areas material to the Company’s stakeholders

    Sustainability Report, updated in April 2021 and published to the Company’s website at http://investors.glaukos.com, details how the Company’s internal Sustainability Council determined areas of focus for Company based on stakeholder input, and sets measurable goals in each of these focus areas; additionally, Company formalized the Board’s oversight of ESG matters through the Compensation Committee of the Board

Provides focus and accountability for the Company to enhance and mature its ESG programs and reporting, with a goal to increase long-term value to shareholders

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Stockholder Feedback

Responsive Action Taken

Impact of Action

Company should adopt an ESG framework guided by established sustainability standards

    Sustainability Accounting Standards Board (SASB) and Global Reporting Initiative (GRI) standards taken into account when preparing the Company’s 2020 Sustainability Report, updated in 2021; majority of Company’s material areas of focus are aligned with the SASB pharmaceutical and medical equipment topics

Provides readers of our Sustainability Report with a consistent framework upon which to evaluate our ESG program and topics we have determined are most important to our internal and external stakeholders

Company should tie executive and management compensation to ESG performance

    2021 Performance-based equity grants for senior leadership team, including NEOs, based on regulatory approval of pipeline products, one of Company’s ESG innovation goals deemed material to Company’s stakeholders because innovation fuels our ability to transform vision care and create sustainable revenue growth; additional senior management bonuses tied to achievement of department ESG goals

Focuses leadership team performance on innovations to address unmet clinical needs, improve the existing standards-of-care, and enrich the lives of patients living with chronic eye diseases and disorders

Performance-based equity should comprise a greater portion of Company’s long-term equity compensation for executive officers, and should cover a longer performance period

     2020 Performance-Based Equity portion of long-term incentive compensation grant increased from 33% to 50% of total value for CEO, decreasing the proportion of time-based equity received, and continued use of performance-based equity for other executive officers; 2021 Performance-Based Equity grants are earned over the course of 4 years, increased from 3 years in 2020, and have a time-based vesting period after performance criteria are satisfied

Further incentivizes executive achievement of important Company strategic and operational goals that create value for stockholders while acting as an effective retention tool for key executives

Company should monitor its equity burn rate and keep it consistent with peer company levels

    Compensation Committee monitors equity burn rate on a quarterly basis; equity burn rate at time of setting 2021 Company-wide equity budget was below peer median, notwithstanding that all employees within the Company participate in annual equity grants

Ensures Company is granting equity in a measured and responsible manner, avoiding dilution of investors’ interests

Company should provide greater transparency into status and progress of pipeline product development

    Company disclosed detailed clinical trial data in early 2021, including 12-month pivotal trial results for its iStent infinite™ product, 24-month interim data on its iDose® TR sustained-release travoprost implant, and Phase 3 pivotal trial results for its iLink™ Epi-on investigational therapy; Company also discloses anticipated FDA approval dates for its pipeline products for the coming 4-5 years

Allows investors and potential investors to analyze the growth and value potential of the Company and motivates management to meet the disclosed timeframes

The Company and the Compensation Committee listen to the input we receive from our stockholders, with the intention of responding to that input in an appropriate and thoughtful manner that considers the Company’s stage in its development cycle and its needs from a leadership and operational perspective. We believe we have responded fully and appropriately to the feedback received from stockholders through these outreach campaigns. We intend to continue the dialogue with our stockholders on these and other matters to ensure the Board of Directors is apprised of their views and governance and compensation best practices more

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broadly. In addition, our Board of Directors will regularly review the Company’s current corporate governance structure to ensure it continues to align the interest of the Company with its stockholders, and consider appropriate governance changes as the Company matures.

Director Independence

Under the rules of the New York Stock Exchange (the “NYSE”) and our Corporate Governance Guidelines, independent directors must comprise a majority of our Board of Directors. Under the NYSE rules, a director will only qualify as an “independent director” if our Board of Directors affirmatively determines that the director has no material relationship with us (either directly or as a partner, stockholder or officer of an organization that has a relationship with us).

Our Board of Directors reviewed its composition and the independence of our directors and considered whether any director has a material relationship with us that could interfere with his or her ability to exercise independent judgment in carrying out his or her responsibilities. 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 determined that each of Messrs. Foley, Hoffmeister and Stapley, Drs. Kliman, Wen and Link, and Mses. Weisner and Torres is “independent” as that term is defined under the rules of the NYSE. Mr. Burns is not an independent director as a result of his position as our President and Chief Executive Officer.

In making these determinations, our Board of Directors considered the relationships that each non-employee director has with us and all other facts and circumstances our Board of Directors deemed relevant in determining independence, including, without limitation, the affiliation Drs. Link and Kliman have or had with entities that previously owned more than 5% of our common stock as well as Dr. Kliman’s previous position on the board of directors of Avedro.

Board Leadership Structure

We have no policy requiring either that the positions of the Chairman of the Board and our Chief Executive Officer be separate or that they be occupied by the same individual. Our Board of Directors believes that it is important to retain flexibility to allocate the responsibilities of the offices of the Chairman of the Board and Chief Executive Officer in a way that is in our best interests and the best interests of our stockholders at a given point in time. We currently separate the roles of Chief Executive Officer and Chairman of the Board, and Dr. Link, an independent director, currently serves as Chairman of the Board.

The Board recognizes that the roles of Chief Executive Officer and Chairman of the Board are distinct. While the Chief Executive Officer is responsible for setting our strategic direction and for our day-to-day leadership and performance, the Chairman of the Board provides guidance to the Chief Executive Officer and sets the agenda for, and presides over, meetings of the Board of Directors. The Board believes that participation of the Chief Executive Officer as a director, while keeping the roles of Chief Executive Officer and Chairman of the Board separate, provides the proper balance between independence and management participation at this time.

The Board’s Role in Risk Oversight

Our Board of Directors, as a whole and through its committees, serves an active role in overseeing the management of risks related to our business. Our officers are responsible for day-to-day risk management activities. The full Board monitors risks through regular reports from each of the committee chairs, and is apprised of particular risk management issues in connection with its general oversight and approval of corporate matters. The Board and its committees oversee risks associated with their respective areas of responsibility, as summarized below. Each committee meets with key management personnel and representatives of outside advisers regularly and as required.

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CORPORATE GOVERNANCE

Our Board of Directors manages specific areas of risk exposure through its committees of the Board of Directors as follows:

The Audit Committee serves an active role in overseeing the management of risks related to general operational matters, including without limitation, manufacturing, reimbursement, international expansion and cybersecurity. The Audit Committee receives quarterly assessments of risk related to operational matters and meets regularly with the functional leaders within the Company who manage such risks. As part of these updates, the Audit Committee, which is comprised solely of independent directors, reviews the Company’s data security risk mitigation efforts, including company-wide information system testing and training, the cyber enterprise risk management insurance coverage that the Company carries, and third-party assessments of the security of our information systems and potential data threats. The Audit Committee also assesses management’s plans to monitor, control and minimize any risk exposure. The Audit Committee is also responsible for primary risk oversight related to our financial reporting, accounting and internal controls, oversees risks related to our compliance with legal and regulatory requirements, and meets regularly with our internal auditors and our independent registered public accounting firm.

The Compensation Committee oversees, among other things, the assessment and management of risks related to our compensation plans, policies and overall philosophy and equity-based incentive plans. The Compensation Committee also oversees the assessment and management of risks related to our governance structure, including our Board leadership structure and management succession, and ESG, climate change, diversity and inclusion and human capital management related matters.

The Compensation Committee identifies and considers risks related to our executive compensation, including during its review and approval of our executive compensation program. Our compensation programs are designed to reward our named executive officers and other employees for the achievement of the Company’s corporate strategies, business objectives and the creation of long-term value for stockholders, while at the same time avoiding the encouragement of unnecessary or excessive risk-taking. The Compensation Committee has concluded that the current executive compensation program does not encourage inappropriate or excessive risk-taking. In making its determination, the Compensation Committee noted that each executive officer’s direct compensation under our executive compensation program consists primarily of a fixed base salary, an annual incentive bonus opportunity and long-term equity incentive awards. Annual incentive bonuses are balanced with long-term equity incentives, which are subject to multi-year vesting schedules or only vest upon the achievement of strategic performance objectives.

Our Board believes that the processes it has established for overseeing risk would be effective under a variety of leadership frameworks and therefore the Board’s leadership structure, as described under “Board Leadership Structure” above, was not affected by risk oversight considerations.

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Committees of the Board of Directors

The Board has two standing committees: the Audit Committee and the Compensation, Nominating and Corporate Governance Committee. The written charters of these committees are available under “Corporate Governance” on our website at http://investors.glaukos.com. Additionally, in 2020, the Board formed the Equity Awards Committee, comprised of Mr. Burns, our Chief Executive Officer, to approve equity grants to employees other than our senior leadership team, so long as such grants are within the guidelines established by our Compensation Committee on an annual basis, and meet certain other limitations described in the Equity Awards Committee charter.

Director

Audit

Compensation,
Nominating &
Governance

Thomas W. Burns

William J. Link, Ph.D.   Graphic

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Mark J. Foley    Graphic

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Chair

Marc A. Stapley   Graphic  Graphic

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Chair

Aimee S. Weisner   Graphic

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David F. Hoffmeister    Graphic  Graphic

Graphic

Gilbert H. Kliman, M.D.   Graphic

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Leana S. Wen, M.D.   Graphic

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Denise M. Torres Graphic  

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Graphic Independent Director Graphic Financial Expert Graphic Committee Member

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Audit Committee

Our Board of Directors determined that Messrs. Stapley and Hoffmeister, Ms. Weisner and Dr. Wen, who comprise our Audit Committee, satisfy the independence standards for such committee established by applicable SEC rules and the listing standards of the NYSE. Additionally, our Board of Directors has determined that each of Messrs. Stapley and Hoffmeister is an “audit committee financial expert” as defined by applicable SEC rules.

ur

Committee Members

Primary Responsibilities

Number of
Meetings
in 2020

Marc A. Stapley (Chair)

David F. Hoffmeister

Aimee S. Weisner

Leana S. Wen, M.D.*

   Appointing, evaluating, retaining, approving the compensation of, and assessing the independence of our independent registered public accounting firm.

   Overseeing the work of our independent registered public accounting firm, including through the receipt and consideration of reports from that firm.

   Reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures.

   Overseeing our internal control over financial reporting, disclosure controls and procedures and code of conduct.

   Monitoring our internal audit function and overseeing the internal auditor.

   Reviewing and approving or ratifying any related person transactions.

   Monitoring risks associated with cybersecurity and data privacy threats.

   Preparing the Audit Committee report required by SEC rules.

8

* Dr. Wen was appointed to the Audit Committee on March 18, 2021.

The Company has a full-time internal audit function that reports to the Audit Committee and the Chief Financial Officer, and is responsible for, among other things, reviewing and evaluating the adequacy, effectiveness and quality of the Company’s system of internal controls. The Audit Committee engages, terminates, determines compensation for, and oversees the independent registered public accounting firm, reviews the scope of the audit by the independent registered public accounting firm and inquiries into the effectiveness of the Company’s accounting and internal control functions. The Audit Committee also approves or ratifies any related party transactions, as described under “Transactions with Related Persons” below.

In addition to overseeing our internal controls over financial reporting and the work of our independent public accounting firm, the Audit Committee also monitors our risk assessment and management efforts. The Audit Committee receives quarterly reports from management regarding operational risks facing our Company, including semiannual cybersecurity updates and data security risk mitigation efforts, and manufacturing risk reports.

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Compensation, Nominating and Governance Committee

Our Board of Directors determined that Mr. Foley, Drs. Kliman and Link and Ms. Torres, who comprise our Compensation Committee, satisfy the independence standards for such committee established by applicable SEC rules and the listing standards of the NYSE. In making its independence determination for each member of the Compensation Committee, our Board of Directors considered whether the director has a relationship with the Company that is material to the director’s ability to be independent from management in connection with the duties of a compensation committee member.

Committee Members

Primary Responsibilities

Number of
Meetings
in 2020

Mark J. Foley (Chair)

William J. Link, Ph.D.

Gilbert H. Kliman, M.D.

Denice M. Torres*

   Determining our Chief Executive Officer’s compensation.

   Reviewing and approving, or making recommendations to our Board of Directors with respect to, the compensation of our other executive officers.

   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.

   Preparing the compensation committee report.

   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 at each annual meeting of stockholders.

   Evaluating the composition of each of our Board’s committees and making recommendations to the Board of Directors for changes or rotation of committee members.

   Overseeing an annual evaluation and peer review of our Board of Directors.

   Overseeing ESG, climate change, diversity and inclusion and human capital management related matters.

4

* Ms. Torres was appointed to the Compensation Committee on March 18, 2021.

The Compensation Committee may form subcommittees and delegate to its subcommittees such power and authority as it deems appropriate from time to time under the circumstances. In 2020, the Board formed the Equity Awards Committee, comprised of Mr. Burns, our Chief Executive Officer, to approve equity grants to employees other than our senior leadership team so long as such grants are within the guidelines established by our Compensation Committee on an annual basis and meet certain other limitations described in the Equity Awards Committee charter. The Compensation Committee has no current intention to further delegate any of its responsibilities to a subcommittee. The Compensation Committee may confer with the Board in determining the compensation for the Chief Executive Officer. In determining compensation for executive officers other than the Chief Executive Officer, the Compensation Committee considers, among other things, the recommendations of the Chief Executive Officer.

Pursuant to its charter, the Compensation Committee is authorized to retain or obtain the advice of compensation consultants, legal counsel or other advisors to assist in the evaluation of director and executive officer compensation or in carrying out its other responsibilities. During fiscal 2020, the Compensation Committee retained Frederic W. Cook & Co., Inc. (“FW Cook”) as its compensation consultant to evaluate the existing executive and non-employee director compensation programs and perform the services that are described in the Compensation Discussion and Analysis section below. FW Cook did not provide any other services to the Company during fiscal 2020. In connection with the compensation consultant services provided by FW Cook, the Compensation Committee has assessed the independence of FW Cook and does not believe its work has raised any conflict of interest.

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The Compensation Committee oversees the Company’s ESG efforts. As described below under the heading “ESG and Sustainability,” this ESG oversight by the Compensation Committee was formalized by a December 2020 amendment to the Compensation Committee’s charter as part of the Company’s enhancement of its overall sustainability program. The Compensation Committee also retains direct oversight of the Company’s human capital management process, including workforce diversity and inclusion; health, safety and wellness; philanthropy and volunteerism; training and development; and compensation and benefits. The Compensation Committee also oversees the Board’s director evaluation process.

Meetings and Attendance

During fiscal 2020, our Board of Directors held six meetings, the Audit Committee held eight meetings and the Compensation Committee held four meetings. Each of our directors attended at least 75% of the aggregate meetings of the Board and the committees of the Board on which he or she served during fiscal 2020. In addition, independent directors of our Board of Directors meet in regularly scheduled sessions without management.

It is the Board of Directors’ policy to invite and encourage directors to participate in our annual meeting of stockholders. At our virtual annual meeting of stockholders held during fiscal 2020, all of our directors participated.

Succession Planning

The Board of Directors recognizes that advance planning for contingencies such as the departure, death or disability of the chief executive officer or other top executives is critical so that, in the event of an untimely vacancy, the Company has in place a succession plan to facilitate the transition to both interim and longer-term leadership. The designation of the chief executive officer, as in the case of other officers, is a decision for the Board of Directors. The Board, in a process overseen by the Compensation Committee, reviews succession planning for the chief executive officer and other senior leaders on an annual basis.

Board Evaluation Process

Annually, each director completes a written questionnaire self-assessing the structure, composition, oversight and effectiveness of the Board and each of its standing committees, as well as the Board’s access to and level of interaction with management. Additionally, each director engages in an individual oral peer evaluation interview facilitated by the Company’s General Counsel assessing the engagement and performance of the Board as a whole and each individual director. The results of these assessments are presented to the full Board on an anonymous basis.

Consideration of Director Candidates

Our Board of Directors and the Compensation Committee will consider director candidates recommended for election to the Board of Directors by stockholders in the same manner and using the same criteria as that used for any other director candidate. The Compensation Committee has not established any specific minimum qualifications that must be met by a director candidate. In evaluating a director candidate, the Compensation Committee will consider whether the composition of the Board reflects the appropriate balance of independence, sound judgment, business specialization, understanding of our business environment, willingness to devote adequate time to Board duties, technical skills, diversity and other background, experience and qualities as determined by the Compensation Committee. While our Board of Directors has no formal policy for the consideration of diversity in identifying director nominees, the Compensation Committee seeks to have a board of directors that will collectively represent a diversity of backgrounds and experience and will endeavor to include women and individuals from minority groups in the qualified candidate pool from which any new director candidates will be drawn. Two directors were appointed to the Board effective March 1, 2021, and both were recommended by a third party search firm. The Board considered the benefit of Ms. Torres’ experience in the pharmaceutical industry, as well as her leadership skills and extensive background in the medical device industry, in determining to add her to the Board. The Board also took into account Dr. Wen’s experience treating patients as a physician and her broad familiarity

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with the public health system and knowledge of governmental regulation of the medical industry. Additionally, the Board recognized the diverse perspectives both women would bring to the Board, as each comes from an ethnic minority background.

Board Attributes

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Independence

Gender Diversity

Underrepresented Communities

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Public Company Experience

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Stockholders who wish to recommend a director candidate for consideration by the Compensation Committee and the Board should submit their recommendation in writing to the Board no later than January 1 prior to the next annual meeting of stockholders together with the following information: (1) the name and address of the stockholder as they appear on the Company’s books or other proof of share ownership; (2) the class and number of shares of common stock of the Company beneficially owned by the stockholder as of the date the stockholder submits the recommendation; (3) a description of all arrangements or understandings between the stockholder and the director candidate and any other person(s) pursuant to which the recommendation is being made; (4) the name, age, business address and residence address of the director candidate and a description of the director candidate’s business experience for at least the previous five years; (5) the principal occupation or employment of the director candidate; (6) the class and number of shares of common stock of the Company beneficially owned by the director candidate; (7) the consent of the director candidate to serve as a member of our Board of Directors if elected; and (8) any other information that would be required to be disclosed with respect to such director candidate in solicitations for proxies for the election of directors pursuant to applicable rules of the SEC. The Compensation Committee may request additional information concerning such director candidate as it deems reasonably required to determine the eligibility and qualification of the director candidate to serve as a member of the Board of Directors.

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Stockholders who wish to nominate a person for election as a director in connection with an annual meeting of stockholders (as opposed to making a recommendation to the Compensation Committee as described above) must deliver written notice to our Secretary in the manner described in our Amended and Restated Bylaws (“Bylaws”), and as described further under “Proposals of Stockholders and Director Nominations for 2021 Annual Meeting” below.

Communications with the Board of Directors

The Board of Directors has established a process to receive communications from stockholders and other interested parties. Stockholders and other interested parties may communicate directly with members of the Board of Directors, the independent directors or the Chairman of the Board of Directors by submitting a communication in an envelope marked “Confidential” addressed to the “Board of Directors,” “Independent Members of the Board of Directors,” or “Chairperson,” as applicable, at: Glaukos Corporation, 229 Avenida Fabricante, San Clemente, California 92672. In addition, if requested by stockholders, when appropriate, the Chairman of the Board will also be available for consultation and direct communication with stockholders.

Policy on Pledging and Hedging of Company Shares

As part of our Insider Trading Policy adopted by our Board of Directors and applicable to our directors, officers and employees, their immediate family members sharing the same household and any entities such as trusts, partnerships, or corporations over which they have or share voting or investment control (collectively, “Insiders”), Insiders are not permitted to engage in any short sale of Glaukos securities, pledge shares as collateral for a loan or margin Glaukos securities in a margin account or purchase financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds), or otherwise engage in transactions, that hedge or offset, or are designed to hedge or offset, any decrease in the market value of Glaukos securities.

Code of Conduct and Ethics

We have adopted a written code of business conduct and ethics that applies to our directors, executive officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, and persons performing similar functions. A current copy of the code is posted under “Corporate Governance” on our website at http://investors.glaukos.com. To the extent required by rules adopted by the SEC and NYSE, we intend to promptly disclose future amendments to certain provisions of the code, or waivers of such provisions granted to executive officers and directors, on our website at www.glaukos.com.

COVID-19 Response

As the COVID-19 pandemic emerged in December of 2019, and began to increase throughout the U.S. in early 2020, we took swift and decisive action to protect two vital aspects of our business, our employees and our product pipeline. To minimize the spread of COVID-19 and protect our employees, we shifted the majority of our workforce to remote operations, which continues through the date hereof. We increased the regularity and thoroughness of our facility cleanings while maintaining streamlined manufacturing and assembly processes in order to consistently provide product to our customers, and their patients, who depend on us. In addition to other health and safety protocols that follow applicable guidance and regulations, employees involved in such operation-critical processes were organized into a number of small shifts designed to minimize the time any one individual is required to be onsite. Further, in an effort to identify, and avoid further infection from, asymptomatic cases, we have offered periodic voluntary COVID-19 viral testing to on-site employees. Additionally, we instituted a number of support programs and policies to assist our employees during the pandemic—many of which are described further in our 2020 Sustainability Report posted under “Corporate Governance” on our website at http://investors.glaukos.com.

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To preserve our pipeline, we sought to maintain our cash position by instituting a number of cost saving initiatives, especially with respect to capital expenditures, the majority of which have now been reinstated, although we continue to carefully manage our discretionary spending. These actions were designed to preserve jobs and core research and development programs. We were successful in retaining over 98% of our global workforce, and keep our nearer-term products progressing through their clinical stages, despite the significant impact of the COVID-19 pandemic. Further, in June 2020, we issued an aggregate principal amount of $287.5 million of 2.75% convertible notes due 2027, the net proceeds of which will be used for working capital and general corporate purposes. For more information on our COVID-19 response, please see the Compensation Discussion & Analysis section below, under the heading “COVID-19 Pandemic Response.”

ESG and Sustainability

As we have grown to more than 650 employees and over 750,000 iStent products implanted globally, so too has our commitment to creating a positive social impact in a responsible and ethical manner. Ensuring the broadest impact of our sight-saving products, expanding opportunities for all workers, improving our local and global communities and respecting the rights of all humans are pillars of our corporate culture that create a more fulfilled workforce that benefits all stakeholders.

In 2020, we built on our inaugural Sustainability Report, released earlier in that year, to improve the Company’s oversight of ESG matters and advance the creation and implementation of ESG policies, programs, goal setting and reporting. In December 2020, we amended our Compensation Committee charter to provide that the Compensation Committee oversee the Company’s ESG policies and practices, including the Company’s human capital management programs, diversity and inclusion efforts, as well as the Company’s public reporting on these topics. In April 2021 we released our 2020 Sustainability Report that details our efforts to take a more holistic approach to ESG and sustainability matters, including the creation of the Glaukos Sustainability Council, which is comprised of internal senior subject matter experts. This Council conducted internal and external research into which ESG topics are considered most impactful to Glaukos and set meaningful sustainability goals for each of those “Tier 1” topics. See above under “Stockholder Engagement and Responsiveness” for additional information.

Glaukos is also committed to developing a comprehensive, cohesive and positive employee experience. We consider talent attraction, development, engagement and retention a key driver of our business success. As further detailed in our 2020 Sustainability Report, we strive to create a diverse workforce that provides equal opportunity regardless of race, gender, religion, national origin or sexual orientation. We regularly monitor our hiring, promotion, and compensation practices to ensure that all candidates and employees are treated with fairness and equity. As of December 31, 2020, women comprised 14% of the Company’s Board, 38% of senior management reporting to the CEO and 38% of our workforce. By March 2021, female representation among our Board members had increased to thirty three percent (33%) and minority representation had increased to twenty-two percent (22%).  Further, in fiscal 2020, approximately forty percent (40%) of our new hires were women, and approximately forty two percent (42%) of our U.S. new hires were from underrepresented communities. We continue to seek out diversity and create an environment of inclusion as a means to drive innovation within the organization.

We also try to improve the communities in which we work and serve, both locally and globally. Since its founding, Glaukos has donated more than $10.0 million worth of its products and therapies to benefit underserved patients in 44 countries around the globe. We have partnered with over 100 humanitarian organizations around the world to supply Glaukos products and other financial support for philanthropic purposes. In 2019, we established the Glaukos Charitable Foundation to aid our charitable efforts and reinforce our corporate culture of giving. Glaukos also provides paid time off to employees who volunteer outside business hours, and employees are entitled to donate their personal paid time off to assist their fellow employees that require additional time off due to hardship or family crisis. We are proud of the efforts we and our employees have made to improve the societies and populations that we serve.

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These and our other human capital management programs and initiatives, including workforce diversity, inclusion and belonging, health, safety and wellness, philanthropy and volunteerism, training and development and compensation and benefits, are explained in greater detail in Part I, Item 1, of the 2020 Annual Report, under the heading “Human Capital Management” as well as in our 2020 Sustainability Report.”

The 2020 Sustainability Report, and other ESG and sustainability related materials, are posted under “Corporate Governance” on our website at http://investors.glaukos.com.

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EXECUTIVE OFFICERS OF THE COMPANY

The table below sets forth certain information regarding our executive officers as of April 8, 2020:

Name

Age

Position

Thomas W. Burns

60

President, Chief Executive Officer & Director

Chris M. Calcaterra

60

Chief Operating Officer

Joseph E. Gilliam

45

Chief Financial Officer and Senior Vice President, Corporate Development

See “Proposal One — Election of Directors” for information concerning the business experience of Mr. Burns. Information concerning the business experience of our other executive officers is set forth below.

Chris M. Calcaterra
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Mr. Calcaterra served as our chief commercial officer from April 2008 until becoming our chief operating officer in February 2017. He has more than 30 years of experience in the ophthalmic medical technology industry. Prior to joining our Company, Mr. Calcaterra was senior vice president at Advanced Medical Optics, Inc. (acquired by Abbott Laboratories), and was responsible for its cataract business. Prior to that position, Mr. Calcaterra held increasingly responsible vice president positions in a variety of sales and marketing roles at Advanced Medical Optics, Inc., as well as its predecessor surgical division business at Allergan, Inc. Mr. Calcaterra has a B.S. from Miami University and an M.B.A. from Xavier University, and he was previously a board member of WaveTec Vision Systems, Inc. (acquired by Novartis).

Joseph E. Gilliam
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Mr. Gilliam has served as our chief financial officer and senior vice president, corporate development since May 2017, with current responsibilities that also include Global Regulatory, Quality, and Information Technology. He has nearly 20 years of experience across capital markets, strategic advisory, finance and banking services with an emphasis on the life sciences industry, including the medical technology, diagnostics and biotechnology sectors. From 2013 to May 2017, he was a Managing Director in the Healthcare Investment Banking group at J.P. Morgan, where he led the Glaukos initial public offering for the firm. From 2001 to 2013, Mr. Gilliam held positions of increasing responsibility at J.P. Morgan, with experience spanning mergers and acquisitions, primary and secondary public equity offerings, bank lending, bond offerings and other transactions. His prior experience includes positions at The Beacon Group (which was combined with J.P. Morgan and Chase Manhattan in 2001) and PricewaterhouseCoopers. Mr. Gilliam has a B.S. in accounting from the Kelly School of Business at Indiana University.

There are no family relationships between or among any of our executive officers or directors.

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PROPOSAL 2 — ADVISORY APPROVAL OF NAMED
EXECUTIVE OFFICER COMPENSATION

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS. UNLESS OTHERWISE INSTRUCTED, THE PROXY HOLDERS WILL VOTE THE PROXIES RECEIVED BY THEM “FOR” OUR NAMED EXECUTIVE OFFICER COMPENSATION.

In accordance with Section 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which was amended pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”), we are asking our stockholders to approve, on a non-binding, advisory basis, the compensation of our Named Executive Officers (as defined below under the heading “Compensation Discussion and Analysis”) as disclosed in this Proxy Statement.

As described in detail under the heading “Compensation Discussion and Analysis,” our executive compensation program is designed to:

Attract and retain top-caliber executives: Executives receive base salaries and employee benefits that are market competitive and that permit us to hire and retain highly skilled individuals at all levels;
Pay for performance: A significant portion of the annual compensation for our executive leadership team is based on the company’s annual business performance and each individual’s contribution to that performance;
Reward both near-term results and long-term growth: Our compensation programs provide the opportunity to our executive leadership to be rewarded for achievement of both near-term and long-term results;
Align compensation with business performance: A significant portion of our executive leadership team’s compensation is tied to measures of performance for our business; and
Align compensation with shareholder interests: The interests of our executive leadership team are linked with those of our shareholders through the risks and rewards of ownership of Glaukos stock.

We urge stockholders to read the “Executive Compensation” section beginning on page 30 of this Proxy Statement which describes in more detail the key elements of our executive compensation program. The Compensation Committee and the Board of Directors believe that our executive compensation program is appropriately designed to achieve the Company’s business objectives and create long-term value for our stockholders.

Accordingly, we ask our stockholders to approve the following resolution at the Annual Meeting:

“RESOLVED, that the Company’s stockholders approve, on an advisory basis, the compensation paid to the Company’s Named Executive Officers as set forth under “Executive Compensation,” including the Compensation Discussion and Analysis, Summary Compensation Table and the related compensation tables and narrative disclosure in this Proxy Statement for the 2021 Annual Meeting of Stockholders.”

The vote is advisory, which means that the vote is not binding on the Company, our Board of Directors or the Compensation Committee. However, the Compensation Committee, which is responsible for designing and administering our executive compensation program, values the opinions expressed by our stockholders in their vote on this proposal, and will consider the outcome of the vote when making future compensation decisions for Named Executive Officers.

We intend to provide our stockholders with an opportunity to approve the compensation of the Company’s named executive officers each year at the annual meeting of stockholders.

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

This Compensation Discussion and Analysis describes the objectives of our executive compensation program and provides disclosure about the elements of compensation earned by and awarded to each of the executive officers identified in the “Summary Compensation Table,” whom we refer to in this section as our “Named Executive Officers” or “NEOs.” It also describes the philosophy of, and process followed by, our Compensation Committee in making compensation decisions and setting compensation policy for our Named Executive Officers.

2020 Named Executive Officers

Our Named Executive Officers for fiscal year 2020 were:

Thomas W. Burns

President and Chief Executive Officer

Chris M. Calcaterra

Chief Operating Officer

Joseph E. Gilliam

Chief Financial Officer and Senior Vice President, Corporate Development

The Named Executive Officers were our only executive officers during 2020.

COVID-19 Pandemic Response

For Glaukos, the COVID-19 pandemic upended how we do business and forced us to reassess what is most important. Government-mandated lockdowns restricted elective surgical procedures, such as those in which our products are used, on a worldwide basis, severely impacting our global sales. By late March 2020, these restrictions led to the increasing deferral of cataract and keratoconus procedures and global sales trends that were less than 15% of levels achieved prior to the COVID-19 outbreak. This trough only deepened through April 2020, when we saw sales decrease to approximately 10% of pre-COVID levels. Management and our Board quickly determined the key priorities under which we would operate during this unprecedented time of uncertainty. The response plans we prioritized and implemented in 2020 included protecting the health and safety of our employees and their families, supporting our customers, preserving jobs globally, protecting core research and development projects, and maintaining our strong financial and operating position following the pandemic. Under this management team’s guidance, we saw our revenue run rate return to approximately 95% of pre-COVID levels by the end of the third quarter of 2020. As a result of the extraordinary efforts and achievement of our senior leaders, we believe we exited 2020 a more efficient and more capable company with fundamental prospects that have never been stronger. The specific activities we implemented included, among other things:

Employee Welfare

Shifted to mainly remote workforce operations
Implemented standard health and safety guidelines for required onsite employees, in compliance with all applicable regulations
Redesigned operation-critical production shifts to minimize employee-to-employee contact and reduce required onsite time
Minimal workforce reductions (less than 2% globally)

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Customer Support

Streamlined manufacturing and assembly processes to continue to produce product for customers; minimal to no disruptions in supply chain to date
Adopted new and expanded digital program and tools to support our customers and clinical investigators in COVID-19 virtual environment
Collaborated with key opinion leaders to develop value-added webinars on our products and how to continue operations in a COVID environment

Financial Strength

Instituted strict cost-savings initiatives, including cutbacks on discretionary spending and capital expenditures, to preserve necessary cash
Temporary deferral of facilities expansion and consolidation plans
Suspended 401(k) matching contributions through the end of 2020, including for NEOs, and initiated 20% salary cuts for many employees from April to October 2020, with our senior leaders, including NEOs, the first to receive cuts and the last to have full salary reinstated
Issued $287.5 million of 2.75% convertible notes in June 2020 to remain on offense with growth and pipeline investments

Management took quick and decisive action to preserve jobs and core research and development programs. The decisions were not easy nor were they made lightly, but Glaukos has emerged a stronger organization today than we were one year ago because of them. The Company reduced selling, general and administrative expenses in 2020 by approximately 3% as compared to 2019, and ended 2020 with cash, cash equivalents, short-term investments, and restricted cash of approximately $413.9 million, an increase of approximately 125% over 2019. At the same time, we were able to retain over 98% of our employees worldwide and continue to progress with our core research and development and clinical and pre-clinical projects to bring pipeline products to market, the greatest contributors to long-term value creation for our stockholders.

2020 Say-on-Pay Stockholder Support and Engagement

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Over 92% of our stockholders voted in favor of our executive compensation program at our 2020 Annual Meeting. As part of our annual stockholder engagement process, we spoke with the holders of approximately 70% of our outstanding shares in Fall 2020. The feedback we received, and the actions we have taken in response to the feedback, is described in the section above entitled “Stockholder Engagement and Responsiveness.” Our Compensation Committee considers the input provided by our stockholders in shaping our executive compensation program and making compensation decisions.

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2020 Accomplishments

By all accounts, the COVID-19 global pandemic created an unprecedented 2020 and challenged the conventional ways our company, employees, and customers operate, both personally and professionally. Overall, we are proud of our performance in 2020 and of our team’s resiliency and steadfast dedication to advancing our mission to create novel platforms that disrupt conventional treatment paradigms, advance the existing standard of care, and enrich the lives and treatment alternatives for patients worldwide. In doing so, we strive to create a world-class global vision care leader uniquely positioned to drive innovation across glaucoma, corneal health, and retinal disease. Within each of these areas, we are moving full speed ahead with the same pioneering discipline, pipeline development expertise, and skilled commercial execution that has made us the worldwide leader of the MIGS marketplace today.

Our ability to execute our plans in 2020 not only illustrates our effective ongoing response to the current market environment, but is also a reflection of the progress we continue to make towards our broader strategic vision. Consider our key 2020 accomplishments:

One, we executed on our corneal health franchise integration, expansion, and market development plans, evidenced by record new starts and Photrexa sales.
Two, we successfully launched the next-generation iStent inject W device in the US and select international markets.
Three, we took swift and decisive action at the outset of the COVID-19 pandemic to protect our employees, continue to service customers and preserve cash, resulting in costs savings of approximately $25 million and exiting the year with sales at approximately 95% of pre-COVID levels.
Four, we reported strong international glaucoma sales and secured new market-expanding regulatory approvals in key markets such as Australia, Japan, and India.
Five, we advanced key market access and reimbursement initiatives, including the creation of new category 3 CPT codes for iDose and standalone MIGS.
Six, we advanced our industry-leading, proprietary pipeline that we believe has the ability to significantly expand our addressable market opportunities beginning in 2021.
Seven, we implemented a global systems upgrade transformation designed to support long-term growth.
And last but certainly not least, we executed financially during unprecedented times, not only through encouraging sales recovery trends, but also with strong gross margins, disciplined operating spending, and continued preservation of our strong balance sheet, bolstered by a $288 million convertible debt financing to further strengthen our ability to aggressively invest in our pipeline and future growth opportunities.

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Despite the challenges created by the COVID-19 pandemic, we have also continued to drive long-term shareholder value. Annualized total shareholder returns were +38.2% and +43.2% for the one- and three-year periods ended December 31, 2020, which ranked at the 69th and 74th percentile of our peer group, respectively.

In summary, we are creating a unique vision care leader prepared to drive a robust cadence of innovation that can significantly expand our market opportunities and drive sustainable growth and profitability over the next decade. The strong foundation and team we’ve built leaves us confident in our continued ability to execute on our long-term strategic plan and advance our mission to transform the treatment of chronic eye diseases for the benefit of patients worldwide.

Executive Compensation Program and Objectives

Our executive compensation program for 2020 was intended to:

Attract and retain top-caliber executives: Executives receive base salaries and employee benefits that are market competitive and that permit us to hire and retain highly skilled individuals at all levels;
Pay for performance: A significant portion of the annual compensation for our executive leadership team is based on the company’s annual business performance and each individual’s contribution to that performance;
Reward both near-term results and long-term growth: Our compensation programs provide the opportunity to our executive leadership to be rewarded for achievement of both near-term and long-term results;
Align compensation with business performance: A significant portion of our executive leadership team’s compensation is tied to measures of performance for our business;
Align compensation with shareholder interests: The interests of our executive leadership team are linked with those of our shareholders through the risks and rewards of ownership of Glaukos stock; and
Reinforce succession planning process: The overall compensation program for our executive leadership team, supports our robust succession planning process.

Our 2020 executive compensation program was comprised of three key elements, each of which was designed to further the program objectives listed above: (1) base salary; (2) annual bonus that is earned upon achievement of specified corporate and/or individual goals; and (3) long-term incentive compensation in the form of equity awards that are subject to both performance-based and time-based vesting requirements. We

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also provide 401(k) retirement benefits, an executive deferred compensation plan, executive physical, and severance benefits to our senior leadership team, including our NEOs.

Element

Description

Primary Design Objective

FIXED

Base Salary

      Annual fixed cash compensation

      Enables us to attract and retain top talent. Provide compensation for functional expertise and day-to-day responsibilities

AT RISK COMPENSATION

Annual Incentive

(Performance Bonus)

      Chief Executive Officer payout evaluated based 100% on achievement of corporate objectives

      Other Named Executive Officer payout evaluated based 75% on corporate objectives and 25% on individual objectives

      Corporate goals are comprised of financial results, progress on product R&D and clinical trial goals

      Executive equity election to receive bonus opportunity in restricted stock units or stock options

      Align executive pay with the achievement of short-term business objectives and performance expectations; designed to help the Company achieve long-term strategic objectives and create long-term value for stockholders

      Emphasize financial results by making them a key factor in determination of bonus, that ensures all Named Executive Officer bonuses are tied to achievement of objective top-line sales growth target

      Equity election incorporates stock price performance into bonus payment value. 15% premium added to provide incentive to convert bonus into equity, preserving cash for growth

Long Term Incentive

       CEO’s performance-based restricted stock units (“PRSUs”) and stock options increased from 33% to 50% of total equity value; remainder in time-based options and RSUs

      1/3 of the value of the long term incentive awards for our other NEOs was allocated to PRSUs; remainder in time-based stock options and RSUs

      PRSUs only vest based on the achievement of pre-determined targets aligned with the Company’s goals

      Time-based options and RSUs vest over 4 years

      Link the interests and risks of executives with those of our stockholders

      Promote executive focus on long-term company performance through stock price and long-term operating performance that is expected to build long-term shareholder value

      Options will only have value if management can drive long-term value creation through stock price appreciation

      Time-based RSU and stock option vesting provides a retention incentive that is aligned with shareholders, even during periods of stock price volatility

The largest component of our compensation program is long-term incentive awards (based upon the grant date value). When combined with the target annual incentive award, the vast majority of executive compensation is “at risk,” or, in other words, dependent on the accomplishment of the Company’s business and financial objectives or the performance of the Company’s stock (or both, in the case of annual bonus awards granted in equity and the PRSUs). In the case of Mr. Burns, 89% of his 2020 target compensation is “at risk.” For our other Named Executive Officers, 81% of their average target compensation is “at risk.”

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Role of the Compensation Committee

Pursuant to its charter, the Compensation Committee has the authority to determine the amount of compensation given to each of the Named Executive Officers, as well as the overall executive compensation program. The Compensation Committee annually evaluates the performance of each of the Named Executive Officers and determines compensation levels based on its performance evaluation. The Compensation Committee also, among other things, reviews and approves our executive compensation elements, plans and policies, and is responsible for administering our equity incentive plans, including approving award grants under the plans. Executive compensation and senior management equity award grants are also approved by our Board of Directors as a whole. In performing its duties, the Compensation Committee is authorized to consider the recommendations of our Chief Executive Officer when determining the compensation of the other members of management, including the Named Executive Officers. The Compensation Committee is also authorized to approve any severance benefits, deferred compensation and change-in-control benefits or any perquisites offered to our Named Executive Officers.

All Compensation Committee members are deemed independent under applicable NYSE rules. None of our Named Executive Officers is a member of our Compensation Committee or otherwise had any role in determining the compensation of our other Named Executive Officers, other than the Chief Executive Officer’s recommendations to the Compensation Committee as to the compensation of the other Named Executive Officers.

Role of the Compensation Consultant

Pursuant to its charter, the Compensation Committee is authorized to retain or obtain the advice of compensation consultants, outside counsel, experts or other advisors to advise the Compensation Committee with respect to amounts or forms of executive compensation or in carrying out its other responsibilities. For 2020, the Compensation Committee retained Frederic W. Cook & Co., Inc. (“FW Cook”) as its independent compensation consultant. The Compensation Committee was directly responsible for the appointment and oversight of the compensation consultant. During 2020, FW Cook provided no services to Glaukos or its management other than its compensation consulting services provided in its capacity as the Compensation Committee’s independent advisor on executive and non-employee director compensation.

In connection with the compensation consultant services provided by FW Cook in 2020, the Compensation Committee has assessed the independence of FW Cook pursuant to the SEC and NYSE rules and has concluded that no conflict of interest exists.

Peer Companies

Below is a listing of the peer group companies used by the Compensation Committee for 2020 comparative compensation purposes. The Compensation Committee’s objective in selecting this peer group was to include a group of comparably-sized public companies in the life sciences sector, with an emphasis on medical technology companies and biotechnology companies with commercialized products. We generally targeted peer companies in this field that had reported annual revenues of less than $1 billion (approximately 4x our 2020 revenue), and held a market capitalization between $750 million and $10 billion (approximately 0.3x to 3.75x our market capitalization at the time of analysis). The Compensation Committee believes that use of these criteria identifies the Company’s peers both for executive talent as well as for capital investment, based on the growth profile of the Company.

In determining the peer group used when setting 2020 executive compensation, the Compensation Committee removed nine companies from the 2019 peer group that no longer fit within the criteria, had limited publicly disclosed information available, or demonstrated irregular pay practices. The Compensation Committee added nine companies to the peer group who are geographically local, compete with the Company for talent, are common peers used by other companies in our peer group, or are frequently

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referenced by our securities analysts. Our peer group used to determine 2020 executive compensation includes the following 20 companies:

Peer Group

Aerie Pharmaceuticals

CryoLife

Insulet

Natus Medical

AtriCure

Globus Medical

Intersect ENT

Nevro

AxoGen

Haemonetics

iRhythm Technologies

Nuvasive

Cardiovascular Systems

ICU Medical

Luminex

Tandem Diabetes

CONMED

Inogen

Masimo

Wright Medical

At the time these criteria were set, the Company’s market cap was at the 68th percentile of the new peer group and slightly below the revenue median of the group. The Compensation Committee reviews the peer group data as a reference point in assessing compensation decisions for the Named Executive Officers using its business judgment. Other factors considered when determining compensation levels include our objective of attracting and retaining highly qualified executives, and our goal of rewarding top performers to motivate and encourage high achievement. Finally, the Compensation Committee notes that due to the rather narrow slice of the ophthalmology field within which the Company operates, the targeted talent pool from which to attract skilled leadership is narrow. As such, it will continue to revisit and revise its peer group in future years to ensure the Company remains competitive in its continuing recruitment and retention efforts.

Material Elements of Compensation

Base Salaries

We provide an annual base salary to each of our Named Executive Officers to compensate them for performing their day-to-day services during the year. Salaries are reviewed annually by the Compensation Committee and may be adjusted for the following year based on a variety of quantitative and qualitative factors, including each executive’s job responsibilities, experience, performance, and competitive market levels, as well as the recommendations of our Chief Executive Officer (except with respect to his own salary). No Named Executive Officer is entitled to any automatic base salary increases.

The chart below shows the change in each Named Executive Officer’s base salary from fiscal 2019 to fiscal 2020. In setting 2020 base salary, the Compensation Committee considered the Company’s financial and operational performance during 2019, noting that the Company had met or overachieved its revenue, expenses, research and development and clinical trial enrollment objectives, and taking into account the strategic transactions that the Company had consummated in 2019, including the acquisition of Avedro, the cornerstone of the Company’s corneal health business, and the licensing arrangement with Intratus. Even after giving effect to these changes, the base salary of each Named Executive Officer was below the median for the comparable position in our peer group.

Named Executive Officer

2019 Base Salary
($)

2020 Base Salary
($)

Increase
($)

Increase (%)

Thomas W. Burns

643,750

676,000

32,250

5.0

Chris M. Calcaterra

408,446

428,869

20,423

5.0

Joseph E. Gilliam

385,632

404,914

19,282

5.0

COVID Salary Reduction

As the full impact of the COVID pandemic hit the Company and its global sales, the Company’s NEO’s, along with the other members of the senior leadership team, voluntarily agreed to reduce their base salaries by 20%, beginning in April 2020. Salaries were ultimately restored in October 2020, after the Company’s sales had seen a return to close to pre-COVID levels.

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In December 2020, the Compensation Committee determined to reimburse these lost wages with a special RSU grant that covered the portion of reduced salary. The RSUs are subject to a three-year annual vesting period, requiring our NEOs to remain employed long-term to earn the salary make-up and creating further alignment with stockholders’ interest in increasing the value of the Company. The table below shows the total reduction in salary for each Named Executive Officer, as well as the price of the Company’s stock on the date of the special RSU grant (December 17, 2020) and the number of RSUs granted to each NEO.

Amed Executive Officer

Named Executive Officer

Total Salary Reduction ($)

Grant Date Stock Price ($)

Special RSUs Granted (#)

Grant Date Fair Value($)

Thomas W. Burns

67,600

72.99

926

67,589

Chris M. Calcaterra

42,900

72.99

588

42,918

Joseph E. Gilliam

40,500

72.99

555

40,509

Annual Bonuses

We provide our senior leadership team, including our Named Executive Officers, with a performance-based annual bonus opportunity. The purpose of this annual bonus is to provide competitive incentives for those employees who contribute to the Company’s success, and to align our executives’ short-term compensation opportunity with the Company’s business objectives and performance expectations. The annual bonus opportunity helps further our compensation objective of aligning executive pay with achievement of the Company’s short-term goals, which are designed to help the Company achieve its long-term strategic goals and create long-term value for our stockholders. We believe this allows us to compete for top talent and encourages our executives to perform at a high level by providing a near-term reward for that performance.

Annual Bonus Targets

The chart below indicates the target bonus opportunity for each of our Named Executive Officers for 2020, which is stated as a percentage of base salary and was not changed from 2019 levels. For 2020, total target cash (which consists of base salary and target bonus opportunity) for each of our NEOs was at or below the median for comparable positions in our peer group.

Named Executive Officer

2019 Target
Bonus (% of
Base Salary)

2020 Target
Bonus (% of
Base Salary)

  2020 Target
Bonus ($)

Thomas W. Burns

100%

100%

676,000

Chris M. Calcaterra

65%

65%

278,765

Joseph E. Gilliam

65%

65%

263,194

Bonus Equity Election

Under our 2020 bonus plan, our executives can elect to receive all or a portion of their annual bonus in the form of stock options, RSUs or cash. The election is made at the start of the year, so that the final value of the bonus payout increases or decreases based on both achievement of bonus targets and stock price performance, and creates an opportunity for our executives to further align their interests with those of our stockholders.

To provide additional incentive for executives to elect equity and preserve cash and to create further alignment between our executives’ and stockholders’ interests, there is a 15% premium component to the conversion from the dollar value of the bonus to the number of RSUs or stock options granted. The 15% premium was modeled on the 15% discount provided to employees who purchase shares of our common stock under the Glaukos Employee Stock Purchase Plan. If an executive elected to convert his or her cash bonus opportunity into an RSU award, then the executive was granted a one-year performance stock unit award with respect to the targeted number of shares having a grant date value equal to the amount of the executive’s cash-denominated target bonus, plus the 15% premium to provide an incentive to convert cash to equity, based upon the closing market price ($28.78) on April 1, 2020 (the date of grant). If an executive elected to convert his or her cash bonus opportunity into a stock option award, then the executive was

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granted a one-year performance stock option award with respect to the targeted number of shares having a Black Scholes value, based upon the closing market price on the date of grant ($28.78), equal to the amount of the executive’s cash-denominated target bonus, plus the 15% premium.

The number of RSUs or options that ultimately vested in 2021 with respect to the 2020 bonus for our executives who elected to receive equity was determined in the same manner as the cash bonuses that became payable under our 2020 bonus plan described above (i.e., the number of RSUs or options that vests is performance-contingent so that the percentage that vest will be the same as the payout percentage for target cash bonuses; in other words, if bonuses were earned at 90% of target, then 90% of the target bonus RSUs or options would vest).

As set forth in the table below, our Chief Operating Officer elected to receive 36% of his 2020 target bonus in the form of bonus stock options rather than cash. He also elected to defer receipt of a portion of his annual bonus pursuant to our nonqualified deferred compensation program. The other NEOs elected to receive the full amount of their annual bonus in cash.

Named Executive Officer

2020 Target
Bonus (% of
Base Salary)

  2020 Target
Bonus ($)

Option Election

(% of Target

Bonus)

Target Stock Option

Value with

15% Premium ($)

Target Bonus

Options Granted

At $28.78

Chris M. Calcaterra

65%

278,765

36%

115,970

8,661

Award Design

The 2020 bonus plan was designed so that the Chief Executive Officer’s bonus was based 100% on the achievement of corporate objectives, while the other Named Executive Officers were based 75% on corporate objectives and 25% on individual performance. This structure reflects the Chief Executive Officer’s ultimate accountability for corporate performance and his personal achievement during the year, while other executives with narrower responsibility are also accountable for performing their own functions.

Executive

% Corporate Objectives

% Individual Objectives

Chief Executive Officer

100%

0%

Other Named Executive Officers

75%

25%

Corporate Objectives

The Company’s corporate objectives for 2020 were established by the Compensation Committee and the Board in late 2019, in consultation with our management team. Each objective was weighted to signify its importance to our short-term and long-term success and strategy. These goals were designed to be challenging but achievable and to align with the Company’s strategic plan and operating budget. These objectives were set based on a pre-COVID budget, and were not changed as the pandemic unfolded, as there was so much uncertainty around the ultimate impact of the pandemic on global sales and clinical and surgical operating dynamics.

Our 2020 corporate objectives included both financial and product or development milestones. The financial objectives reflect the importance of continued strong, but disciplined, growth of the Company and the Company’s goal of transforming the treatment of chronic eye diseases with novel therapies that provide sustainable solutions to important clinical needs. Our two business goals were selected to emphasize the significance of pipeline progress for an innovation-oriented growth company. The products underlying these strategic goals represent opportunities for the Company to expand its market with products that have the potential to transform ophthalmic treatment paradigms.

oFinancial Objectives

Consistent with the Company’s goal of achieving continued growth, the Compensation Committee set a pre-COVID net sales target of $300.2 million as one of the Company’s financial objectives. This target was set by the Compensation Committee taking into account the Company’s 2019 proforma net sales of $273.5 million,

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which includes the full year of 2019 Avedro sales (Avedro was acquired by the Company in late November 2019). When setting this target, the Compensation Committee also considered the integration risks associated with the Avedro acquisition, ongoing improvements with the corneal health franchise reimbursement environment and the competitive landscape in our U.S. glaucoma franchise, as well as the anticipated commercial launch of our new product, the iStent inject W (fully launched in the United States in the second half of 2020). The Compensation Committee wanted to incentivize the Named Executive Officers to achieve top-line sales growth, and therefore used a net sales target as a financial objective. The Company achieved net sales of $225.0 million in 2020, approximately 25% below the sales target, due to the impact of the COVID-19 pandemic and the related shutdowns and restrictions on elective surgical procedures. The COVID-19 pandemic and subsequent economic slowdown materially impacted the global demand for our products, which are used in procedures and therapies that are considered elective. This decrease in demand was most significantly felt in the latter part of the first quarter of 2020 and continuing through the second quarter, with sales at times dipping as low as 10% of our pre-COVID levels. Beginning late in the second quarter of 2020, we began to see trending toward more normalized levels for cataract and keratoconus procedures, a trend that continued through the fourth quarter ended December 31, 2020. The Compensation Committee did not adjust this revenue target, notwithstanding the impact of COVID, and instead determined that the Company had achieved 75% of this corporate objective, which was below the minimum threshold under the 2020 bonus plan formula.

The other financial corporate objective was to incur operating expenses of less than the Company’s pre-COVID adjusted non-GAAP budget of $302.6 million in 2020. When setting this financial objective, the Compensation Committee took into account our continued global expansion within sales and marketing and the expansion of our corneal health franchise, partially offset by the anticipated cost savings of the Avedro acquisition integration. This expense goal also reflected the Company’s internal budget prepared taking into account the Company’s substantial investments into its product pipeline, such as clinical studies supporting our potentially market-expanding pipeline products, including the clinical trials for both the iDose delivery platform and the iStent infinite, as well as R&D efforts with our earlier stage programs such as our retinal and dry eye disease therapies. This goal reflected, on a proforma, adjusted non-GAAP basis, an increase of an estimated 16% over 2019 operating expenses when including the full year of Avedro expenses. The Company’s adjusted non-GAAP operating expenses in 2020 were approximately $235.2 million. This result reflected an aggressive cost-savings initiative instituted by management to preserve cash as the impact of the COVID-19 pandemic became apparent. Capital and other expenditures, including the buildout of the Company’s new headquarters facility, were suspended to ensure that the Company would be able to maintain operations and serve customers without having to make significant reductions in workforce or rely on government PPP loans intended for smaller companies without other access to capital. At the same time, the Company increased 2020 non-GAAP R&D expenses by approximately 21% over the prior year, demonstrating the Company’s commitment not to sacrifice the key driver of its long-term growth. Based on these results, the Compensation Committee determined that this financial objective had been overachieved and earned at 150% of target.

oStrategic Objectives

The first business objective was completion of the iDose clinical trial cohorts by the end of 2020. This metric was chosen to emphasize the significant potential market opportunity presented by the iDose and to motivate management to achieve approval of this transformative treatment as expeditiously as possible. As of December 31, 2020, these trials were 70 subjects, or approximately 5%, short of being fully enrolled. However, the Compensation Committee recognized that the closure of ophthalmic practices and deferral of elective procedures beginning in the first quarter of 2020 in response to COVID- 19 disrupted new patient enrollment in the Company’s ongoing clinical trials. This disruption continued even as facilities have reopened, as doctors prioritize their standard procedures over clinical trial enrollment, and the iDose trials were particularly affected. Notwithstanding this significant disruption, the Company only experienced a slight shortfall in reaching the target enrollment. The Compensation Committee determined that the Company achieved 94% of this strategic objective.

The second business objective was advancement of a particular one of the Company’s early-stage products in development to the point where it was ready for its first in-man evaluation. This product, a drug delivery system that could potentially be used to treat both glaucoma and corneal disorders, was chosen as a

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corporate objective for 2020 to reinforce the importance to the Company of developing innovative treatments for ophthalmic disorders. This product was on track early in 2020 to be ready for in-man evaluation; however, the budget for development of this product was cut drastically in the second quarter of 2020, as the Company sought to preserve cash in light of the COVID-19 global pandemic by prioritizing later-stage products already in the clinical or preclinical stage, at the expense of early stage R&D projects. Notwithstanding these cost-saving measures, the Compensation Committee determined that the Company achieved approximately 75% of this strategic objective.

The two Named Executive Officers other than the Chief Executive Officer had individual objectives (described below) comprising 25% of that portion of their bonus.

Calcaterra Individual Objectives

Mr. Calcaterra’s individual objectives consisted of specific goals in the areas of commercial growth, such as the successful launch of our iStent inject W product, successful integration of our new CRM system with our enterprise resource management system, and successful buildout and management of our corneal health salesforce. Mr. Calcaterra also had individual objectives with respect to addressing certain regulatory matters internationally and international market expansion.

Gilliam Individual Objectives

Mr. Gilliam’s individual objectives consisted of specific goals in the areas of finance, business development, information technology, investor relations and financial planning. This included identification and execution of potential financing alternatives for the Company, integration of our corneal health IT systems and enhancing cybersecurity of our systems, leading the Company’s business development efforts, integration of our corneal health operations from a financial reporting, payroll, budgeting and audit perspective, successful completion of the enterprise resource management system implementation, evaluation of financial reporting and disclosure best practices, and analysis of business disruption risks and mitigation strategies. Mr. Gilliam also had individual objectives with respect to achieving unqualified audit opinions and continued development of internal reporting function and analysis.

Following the end of 2020, the Chief Executive Officer recommended, and the Compensation Committee approved, achievement of 100% of each of Mr. Calcaterra’s and Mr. Gilliam’s individual objectives, and that 100% of the portion of each executive’s bonus tied to the individual objectives was earned. The determinations made by the Compensation Committee with respect to the Company’s satisfaction of the corporate goals and the individual goals results in the following formulaic bonus plan achievement:

Bonus Weighting

2020 Executive Bonus Goals

Target

Actual

CEO

Other NEOs

2020 Actual Achievement

2020 Net Sales Target

$300.2 MM

$225.0 MM

50%

50%

0%

Meet or exceed (underspend) approved 2020 operating expense budget

$302.6 MM

$235.2 MM

20%

10%

150%

Complete iDose clinical trial cohorts

100%

94%

15%

7.5%

94%

Early-stage product available for first in-man evaluation

100%

75%

15%

7.5%

75%

Individual Performance Goals:

-0-

25%

100%

Total Earned:

55.4%

52.68%

Actual Bonus Payout

For 2020, the Compensation Committee determined that each NEO would be awarded a bonus equal to 95% of his target. Bonus payouts were purposely paid below target, but higher than the percentage generated

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under the pre-COVID bonus plan’s funding formula of 52.68% to 55.4%. In determining the NEOs’ 2020 earned bonuses, the Compensation Committee considered the extraordinary performance of the Company’s executive officers in managing the Company through the COVID-19 pandemic. They took note of the Company’s quick action to protect the health and safety of its employees, redesigning manufacturing and assembly work processes to minimize employee contact while maintaining sufficient levels of product to meet demand. Additionally, they took into consideration the decisive cost-saving initiatives the Company instituted, which resulted in approximately $25 million in reduced expenses, as well as the $287.5 million convertible notes financing the Company effected to raise capital while working remotely during the pandemic, which allowed the Company to avoid significant layoffs of employees and continue to advance development of their key strategic pipeline products, the greatest driver of long-term growth and value. The Compensation Committee also took note of the customer support and sales initiatives the Company put in place during this unprecedented time of uncertainty and crisis, including the creation of distance training and education programs for our customers, webinar support resources on running practices during the COVID-19 pandemic, and providing in-person customer assistance as soon as safely possible. The Compensation Committee also noted that, notwithstanding the significant disruption to global sales caused by the pandemic, which at times dropped to 10% of pre-COVID levels, sales for 2020 remained relatively consistent with the prior year, decreasing only 5% from 2019 reported net sales. The Compensation Committee also took into consideration that, based on 2020 enrollment trends prior to the COVID-19 lockdowns, the iDose enrollment goal would have been achieved in full. In considering the corporate goals, the Compensation Committee determined that each would have been achieved and believed that the bonus would have been earned above target but for the disruption caused by COVID-19.

Based on these factors, the Compensation Committee approved the payment of a discretionary bonus in addition to the earned bonus for all bonus-eligible personnel, in an amount sufficient to reach 95% of each employee’s target bonus, to recognize and reward the effort and performance of our workforce during the COVID crisis. The Compensation Committee ensured that the total bonus payout for our senior leadership team was below target, even after taking the discretionary portion into account. Additionally, rather than paying out the full amount in cash, this discretionary portion was paid approximately 60% in cash and 40% in time-based RSUs that were granted in December 2020 and vest 1/3 on each of the first three anniversaries of the grant date. The number of RSUs granted was determined by dividing the value of 40% of the discretionary portion of the annual bonus by the closing stock price of the Company’s common stock on the date of grant ($72.99 on December 17, 2020). The Compensation Committee believed this was an appropriate split between cash and equity as it provided sufficient cash in the short term to reward the Company’s exemplary work during a challenging time, but also contained a significant portion in equity to provide further alignment of our executives’ interests with those of our stockholders. The equity portion also provides retention value: in order for the recipients to receive the full benefit of the RSUs, they must remain employed by the Company for the entire vesting period. Additionally, the RSU grant provides incentive to the recipients, including our NEOs, to continue to drive the growth of the organization.

The discretionary portion of the annual bonus approved by the Compensation Committee consists of approximately 39.6% of bonus target for Mr. Burns, our CEO, and 42.32% of target for our two other NEOs, resulting in a total bonus payout value of 95% of target. The form of payment was made pursuant to the cash, stock option or RSU election made at the start of the plan. Mr. Calcaterra elected to receive 36% of his 2020 annual bonus in the form of stock options and the other 64% in the form of cash.

The values of the portion of the 2020 NEO bonuses earned pursuant to formulaic criteria established prior to COVID-19 and the discretionary portion is set forth in the table below.

Named Executive Officer

2020 Earned Bonus Value ($)

Number of 2020 Bonus Stock Options Earned (#)

2020 Discretionary Bonus Value ($)

Total Actual Bonus Value ($)

Actual Bonus as a % of Target

Thomas W. Burns

374,166

-0-

268,034

642,200

95

Chris M. Calcaterra

146,837

4,562

117,987

264,824

95

Joseph E. Gilliam

138,651

-0-

111,397

250,048

95

The portion of Mr. Calcaterra’s bonus that was deferred pursuant to our nonqualified deferred compensation program is included in the “2020 Earned Bonus Value” column in the table above.

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The discretionary portion of the 2020 annual bonus was determined to be paid out approximately 60% in cash and 40% in RSUs that were granted on December 17, 2020. The portion in RSUs vest one-third on each of the first three anniversaries of the grant date, requiring our NEOs to remain employed long-term and to further align the interests of our NEOs with those of our stockholders. No premium was applied to the RSUs granted. The cash portion of the discretionary bonus, along with the cash portion of the earned bonus, was paid out in March 2021, consistent with the payment of all employee bonuses. The components of the discretionary bonus payouts received by our NEOs are set forth in the table below.

Iscretionary

Named Executive Officer

2020 Discretionary Bonus Value ($)

60% Paid in Cash ($)

Value of ~40% Paid in RSUs ($)

Stock Price on Date of Grant (Dec. 17, 2020) ($)

Number of RSUs Granted

Thomas W. Burns

268,034

161,250

106,784

72.99

1,463

Chris M. Calcaterra

117,987

70,909

47,079

72.99

645

Joseph E. Gilliam

111,397

66,946

44,451

72.99

609

2021 Bonus Plan

In March 2021, the Compensation Committee approved the 2021 executive bonus plan issued under our 2015 Omnibus Incentive Compensation Plan. With regard to performance targets, the Compensation Committee determined to focus on key operational initiatives for the corporate performance component, which include financial components similar to those measured in 2020 as well as strategic objectives tied to pipeline product approvals and pipeline product development accomplishments by the end of 2021. The respective weightings of these 2021 bonus targets is consistent with those applied in 2020.

Long-Term Incentive Compensation

The Compensation Committee believes it is essential to provide long-term equity-based compensation to our executive officers in order to link both the interests and risks of our executive officers with those of our stockholders, which is a cornerstone of the Company’s pay for performance philosophy. Equity awards with a multi-year vesting schedule are designed to reward the creation and preservation of long-term stockholder value. Our management team follows the same philosophy: all employees in the Company receive annual equity grants, to foster a sense of ownership and align interests with those of our investors.

For 2020, long-term incentive compensation consisted of both time-based and performance-based equity grants. Performance-based equity consists of grants of equity that require the achievement of pre-determined operational or financial objectives in order to vest. Additionally, like all equity grants, the value of performance-based equity increases if the price of the Company’s common stock increases. The Compensation Committee believes that the use of performance-based equity advances multiple goals that benefit both the Company and stockholders. Performance-based equity grants incentivize the achievement of the Company’s long- and short-term strategic goals, they motivate executives to work hard to increase the value of the Company, as evidenced by increased stock price, and they encourage executives to remain employed with the Company.

For 2020 equity grants, the Compensation Committee retained the multi-component construct developed in 2019. However, in response to stockholder feedback that our Chief Executive Officer, Mr. Burns, should have a greater percentage of his long-term incentive compensation in the form of performance-based equity, for 2020 the Compensation Committee increased the amount of Mr. Burns’ 2020 equity grant that was performance-based from 33% to 50% of the total grant value. This increase was intended to align Mr. Burns’ interests with those of our stockholders, and require him to achieve critical long-term growth goals in order to earn half of his award. The other half of Mr. Burns’ 2020 equity grant was split equally between time-based RSUs and time-based stock options. For our other Named Executive Officers’ 2020 long-term incentive equity grants, the Compensation Committee retained the 2019 equity grant mix of one-third time-based options, one-third time-based RSUs and one-third performance-based RSUs.

Additionally, in 2020 executives were given the opportunity to convert the time-based RSU portion of their equity award into stock options with equivalent value and to convert the performance-based RSU portion of their equity grant into performance-based stock options with equivalent value and the same long-term

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performance goals. The opportunity to elect to have full value shares granted as options affords those executives who expect the Company’s stock price to increase after the grant date greater potential reward in exchange for the lack of guaranteed value from an RSU. The Compensation Committee views this election to convert full value shares to options as supporting the Company’s entrepreneurial spirit of growth. Mr. Burns elected to receive half of his performance equity grant in the form of stock options and half as PRSUs. Messrs. Calcaterra and Gilliam each chose to receive all of their performance equity in the form of stock options.

2020 Named Executive Officer Equity Grants

The Compensation Committee considered several factors when determining 2020 equity award sizes, including peer group data and the Company’s strong financial and operational performance in 2019. The Compensation Committee noted that the Company had overachieved net sales and operating expense budgets in 2019, and had completed several key strategic acquisitions and partnerships, including the acquisition of Avedro, a licensing deal with Intratus, and a distribution agreement with Santen Pharmaceuticals, which have helped advance the Company into becoming a leader in not only the glaucoma space, but also corneal and retinal health markets. The Compensation Committee also considered the level of grant that it believed would be appropriate to provide strong retention value and more closely link our Named Executive Officers’ compensation to our stockholders’ interests.

The following table shows the intended target total annual equity grant value awarded to each Named Executive Officer in 2020, and the number of time-based options, time-based RSUs, performance-based options and PRSUs granted based on the 2020 performance and compensation review process.

Named Executive Officer

Total Target 2020 Equity Grant Value ($)

Time-Based Stock Options (#)

Time-Based RSUs (#)

Performance-Based Stock Options (#)

PRSUs (#)

Thomas W. Burns

4,700,000

65,170

30,052

65,169

30,051

Chris M. Calcaterra

1,400,000

51,769

-0-

25,880

-0-

Joseph E. Gilliam

1,500,000

55,466

-0-

27,729

-0-

2020 Time-Based Stock Options and RSUs

The time-based equity grants of options to our Named Executive Officers in 2020 vest over four years, with 25% of the options vesting on the first anniversary of the grant date, and the remainder vesting in equal monthly installments over the following three years. The exercise price for the options is the closing price for our stock on the date of grant. The equity grants of time-based RSUs to our Named Executive Officers in 2020 vest over four years, with 25% of the RSUs vesting and being delivered on each of the first four anniversaries of the grant date.

2020 Performance-Based Equity Grant

As discussed above, performance-based equity was increased from 33% to 50% of the total value of our CEO’s 2020 long-term equity grant, and made up one-third of the value for our other NEOs. Goals for our performance-based equity awards were set prior to the COVID-19 pandemic and no changes were made to recognize the impact of the economic shutdown.

The performance-based equity granted to our executives in 2020 is earned based on pre-determined 2020-2022 revenue goals for the Avedro corneal health operations acquired in late 2019. Between 0%-200% of the target award can be earned based on the Company’s under- or over-achievement of the three-year Avedro revenue goals. Earned awards vest when the Compensation Committee determines the corneal health revenue achievement at the end of the full three-year performance period, but vesting for up to one-third of the target options or PRSUs may be earned after each of year one and year two based on achievement of annual revenue goals. No more than one-third of the target number of options or PRSUs can vest in each of years 1 and 2 (i.e., above-target performance can only be earned after the end of the three-year performance period). The long-term revenue objectives were chosen in direct response to stockholder feedback during our 2019 engagement campaign, as multiple stockholders emphasized the importance of successfully integrating the Avedro operations and building the corneal business platform. The Compensation Committee directly

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responded to this feedback by designing performance objectives that they believe will accomplish those goals. Additionally, the three-year performance period was an increase over the performance grant in 2019, which did not have a multi-year element.

The target corneal health revenue for 2020, as set by our Compensation Committee prior to the COVID- 19 global lockdown, was $51 million, representing an approximately 20% increase over Avedro’s 2019 full year proforma, adjusted non-GAAP revenue. The threshold to vest in any portion of the possible one-third acceleration for 2020 was $41 million, or 80% of the target. The Compensation Committee believed that this was a rigorous goal based upon Avedro’s operating history and the challenges of integrating a new business and sales force. The Company actually achieved corneal health net sales of approximately $45.6 million, or 89% of the target, notwithstanding the impact on sales of COVID-19. This level of sales resulted in 74% of the total possible year one equity grants being earned for each NEO.

2021 Named Executive Officer Long-Term Equity Grants

For 2021, the Compensation Committee retained the same equity value mix as 2020, with 50% of our CEO’s 2021 equity awards in the form of performance-based equity and 33.3% of our other Named Executive Officers’ equity awards in performance-based equity.

The performance-based equity granted to our executives in 2021 will be earned based upon certain pipeline product regulatory approvals obtained over a four-year performance period. The performance period was chosen in response to stockholder feedback during our 2020 engagement campaign, as stockholders expressed the desire to see performance equity earned over an even longer period of time than the three years granted in 2020, to provide additional retention incentive and motivate executives to create long-term value for the Company. The Compensation Committee recognized that bringing new products to market is the most effective way for the Company to grow in sales and overall value to our stockholders. By incentivizing the approvals necessary to commercialize our many pipeline products, the Compensation Committee created even greater alignment between our executives and our investors. Additionally, these performance targets are required to be met within four years, putting a tight timeframe on the window to earn the full equity grant and encouraging our management team to get products to market as promptly as possible. The Compensation Committee believes that these performance targets will help the Company achieve its strategic and operations goals and create long-term value.

2019 Named Executive Officer Performance-Based Equity Grant

In 2019, our NEOs received their first grant of PRSUs. These PRSUs would only vest upon the Compensation Committee’s confirmation that at least 75% of the Company’s existing surgeon base, trained on our original iStent product, have completed the rigorous certification training for and converted to our iStent inject product, which was approved by the FDA and commercially launched in 2018. This essential training is designed to ensure that surgeons are properly and fully prepared to utilize our iStent inject product to achieve the highest probability of positive surgical outcomes. In December 2020, the Compensation Committee determined that this operational objective had been satisfied, and the underlying equity grants made to our executives, including our NEOs, were earned and vested. Mr. Burns vested in 19,416 shares, Mr. Calcaterra vested in 6,311 shares and Mr. Gilliam in 6,311 shares.

Severance Benefits

We have entered into executive severance and change in control agreements with each of our senior team leaders, including our three executive officers, Messrs. Burns, Calcaterra and Gilliam. The level of each executive’s severance benefits has been determined to be appropriate by the Compensation Committee, which believes that severance benefits, particularly in the context of the uncertainty surrounding any potential change in control transaction, play a valuable role in attracting and retaining quality executive officers. We believe these potential benefits helped us to assemble a qualified senior leadership team. The payments and benefits provided under our severance and change in control arrangements are designed to provide our Named Executive Officers with treatment that is competitive with market practices.

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As described in more detail below under the heading “Potential Payments Upon Termination or Change in Control,” each of the Named Executive Officers would be entitled to severance benefits in the event of an involuntary termination of employment by us without “cause” or a resignation for “good reason” (each as defined in the executive severance and change in control agreements). The change in control severance benefits are subject to a double trigger, and the Named Executive Officers are not entitled to their cash severance benefits merely because a change in control transaction occurs. The amount of each Named Executive Officer’s severance benefits is increased in connection with a qualifying termination in connection with or following a change in control in order to encourage our Named Executive Officers to remain employed with us, and focus on the creation of value for stockholders, during an important time when their prospects for continued employment following a change in control transaction may be uncertain.

No Named Executive Officer is entitled to receive a “gross-up” or similar payment for any excise taxes that may become payable in connection with a change in control pursuant to Sections 280G and 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), and, depending on what results in the best after-tax benefit for the executive, benefits may be “cut back” instead in such circumstances. Additionally, no new or amended employment agreements were entered into with any of our NEOs since the date of the 2020 Annual Meeting of Stockholders. All members of the Compensation Committee during fiscal 2020 were independent directors and none of them are current or former employees or officers of the Company or had any relationship with us during fiscal 2020 requiring disclosure of certain transactions with related persons under SEC rules.

Other Benefits

All full-time employees, including our Named Executive Officers, are eligible to participate in the Company’s health and welfare benefits, our 401(k) Plan with a company-sponsored match component and our Employee Stock Purchase Plan. Our Named Executive Officers are also eligible for an annual executive physical.

We have also adopted and maintain the Glaukos Corporation Nonqualified Deferred Compensation Plan (the “Deferred Compensation Plan”). The Deferred Compensation Plan permits our management or highly compensated employees, including all of our Named Executive Officers, to elect to defer base salary and annual incentive compensation pursuant to the terms of the Deferred Compensation Plan. Further details on this Deferred Compensation Plan are provided below under the heading, “Nonqualified Deferred Compensation Plans.” As noted below, each of Messrs. Burns and Calcaterra participated in the Deferred Compensation Plan during 2020.

Stock Ownership Policy Applicable to Executive Officers

In 2019, the Compensation Committee adopted a Stock Ownership Policy that requires our executive officers to maintain a meaningful equity stake in our Company. These guidelines require our Chief Executive Officer to own shares of our common stock having a value equal to at least six times his annual base salary, and each of our other Named Executive Officers to own shares of our common stock having a value of at least three times the executive’s annual base salary. Shares subject to stock options and unvested PRSUs are not considered owned by the executive for purposes of this Policy. Each Named Executive Officer is required to meet the minimum stock ownership requirement within five years from the date on which they become subject to the guidelines. As of January 1, 2021, each of our Named Executive Officers was in compliance with the applicable minimum stock ownership levels.

Policy on Pledging and Hedging of Company Shares

As further described in the section titled “Corporate Governance—Policy on Pledging and Hedging of Company Shares,” our Board of Directors has adopted anti-pledging and anti-hedging policies that prohibit our executive officers from pledging Glaukos securities or engaging in hedging transactions.

Clawback Policy

In 2018, in response to stockholder feedback, the Compensation Committee decided to create greater accountability for our executive officers by adopting a policy regarding the recoupment of certain incentive

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compensation payments. Pursuant to this policy, our Board of Directors or the Compensation Committee shall, if it deems appropriate under certain circumstances, require reimbursement or cancellation of all or a portion of any short- or long-term cash or equity incentive payments or awards to our executive officers. This reimbursement requirement would apply when the amount of any such payment or award was determined based upon the achievement of financial results that were subsequently the subject of an accounting restatement due to noncompliance with any financial reporting requirements under federal securities laws, and such restatement was the result of misconduct, if a lesser, or no, payment or award would have been earned based upon the restated financials and the payment or award was received in the three years preceding the date of the restatement.

Policy with Respect to Section 162(m)

Section 162(m) of the Code generally prohibits a publicly-held company from deducting compensation paid to a current or former Named Executive Officer that exceeds $1.0 million during the tax year. Certain awards granted before November 2, 2017 may qualify for an exception to the $1.0 million deductibility limit.

As one of the factors in its consideration of compensation matters, the Compensation Committee notes this deductibility limitation. However, the Compensation Committee has the flexibility to take any compensation-related actions that it determines are in the best interests of the Company and our stockholders, including awarding compensation that may not be deductible for tax purposes. There can be no assurance that any compensation will in fact be deductible.

Compensation Committee Report

The Compensation Committee of the Board has reviewed and discussed with management the disclosures contained in the Compensation Discussion and Analysis section of this Proxy Statement. Based upon this review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis section be included in this Proxy Statement.

Compensation, Nominating and Governance Committee of the Board

Mark J. Foley (chair)

William J. Link, Ph.D.

Gilbert H. Kliman, M.D.

Denice M. Torres*

* Ms. Torres was appointed to the Board of Directors on March 1, 2021 and the Compensation Committee on March 18, 2021. She did not serve on the Compensation Committee during the 2020 year covered in the Compensation Discussion and Analysis section of this Proxy Statement.

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Summary Compensation Table for Fiscal Years 2020, 2019 and 2018

The following table provides information regarding the compensation of our Named Executive Officers during 2020, 2019 and 2018.

Name and principal position

   

Year

   

Salary
($)

(1)   

Bonus
($)(2)

   

Stock
awards ($)(3)

   

Option
awards
($)

(3)   

Non-equity
incentive plan
compensation
($)(4)

 

All other
compensation ($)(5)

   

Total
($)

Thomas W. Burns

2020

$

608,400

$

160,250

$

2,524,400

$

2,350,012

$

374,166

$

1,014

$

6,019,242

President and Chief

2019

$

643,750

$

$

3,416,322

$

1,651,000

$

$

5,488

$

5,716,560

Executive Officer (6)

2018

$

625,000

$

$

717,574

$

3,846,456

$

$

9,687

$

5,198,717

Chris M. Calcaterra

2020

$

385,982

$

70,909

$

89,997

$

1,515,982

$

93,720

$

2,471

$

2,159,061

Chief Operating Officer (6)

2019

$

408,446

$

$

916,088

$

439,166

$

274,488

$

10,400

$

2,048,588

2018

$

396,550

$

$

61,468

$

1,164,059

$

331,912

$

10,250

$

1,964,239

Joseph E. Gilliam

2020

$

364,423

$

66,946

$

84,960

$

1,500,006

$

138,651

$

8,400

$

2,163,386

Chief Financial Officer and

2019

$

385,632

$

$

874,704

$

439,166

$

300,793

$

10,400

$

2,010,695

SVP, Corporate Development

2018

$

374,400

$

$

$

1,164,059

$

404,352

$

10,250

$

1,953,061

(1)Amounts reported for 2020 salary reflect temporary salary reductions effected due to the COVID-19 pandemic. The 2020 annual base salary rate for Mr. Burns, before giving effect to such reduction, was $676,000; for Mr. Calcaterra, $428,869; and for Mr. Gilliam, $404,914.
(2)Amounts reported for 2020 constitute the cash portion of a discretionary bonus approved by the Company’s Compensation Committee and paid to each Named Executive Officer for his extraordinary performance managing the Company through the COVID-19 pandemic. The amount reported for Mr. Calcaterra for 2020 includes the amounts that were deferred under our Deferred Compensation Plan described below.
(3)The amounts shown represent the grant date fair values of stock and option awards granted in the year indicated as computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 718. For a discussion of valuation assumptions used to determine the grant date fair values of equity awards made to executive officers in 2020, see Note 10, Stock-Based Compensation, to our Notes to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020.

2020 Bonus RSUs: The amounts reported in the stock awards column for 2020 include the grant date fair value of restricted stock units (the “Bonus RSUs”) granted to each of our NEOs as part of a discretionary bonus approved by our Compensation Committee in recognition of their exemplary management of the Company during the COVID-19 pandemic. The grant date fair value of the Bonus RSUs was computed in accordance with FASB ASC Topic 718, and excludes the effects of estimated forfeitures. For a more detailed description of these grants of Bonus RSUs, please see “Material Elements of Compensation—Annual Bonuses” in the Compensation Discussion and Analysis section above.

2020 Bonus Options: The amounts reported in the option awards column for 2020 include the grant date fair value of stock options (the “Bonus Options”) granted to Mr. Calcaterra pursuant to his election to receive 36% of his 2020 bonus in the form of stock options rather than cash. The grant date fair value of the Bonus Options was computed in accordance with FASB ASC Topic 718, and excludes the effects of estimated forfeitures. The Bonus Options are valued based on the probable outcome of the applicable performance conditions as determined on the grant date, which results in a grant date fair value for the Bonus Options of $115,971 for Mr. Calcaterra. If we had achieved the highest level of performance under the Bonus Options, the grant date fair value for the Bonus Options would have increased to $231,942 for Mr. Calcaterra. For a more detailed description of these grants of Bonus Options, please see “Material Elements of Compensation—Annual Bonuses” in the Compensation Discussion and Analysis section above.

2020 Performance Options: The amounts reported in the option awards column for 2020 include the grant date fair value of performance-based stock options (the “Performance Options”) granted to each of our Named Executive Officers that only vests upon the achievement of a pre-determined financial target over a multi-year performance period. The grant date fair value of the Performance Options was computed in accordance with FASB ASC Topic 718, and excludes the effects of estimated forfeitures. The Performance Options are valued based on the probable outcome of the applicable performance conditions as determined on the grant date, which results in a grant date fair value for the Performance Options of $1,174,997 for Mr. Burns, $466,616 for Mr. Calcaterra and $499,954 for Mr. Gilliam. The probable outcome of the applicable performance conditions also constitutes the highest level of performance under the Performance Options for the first year of the multi-year performance period. For a more detailed description of these grants of the Performance Options, please see “Material Elements of Compensation—Long-Term Incentive Compensation” in the Compensation Discussion and Analysis section above.

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2020 Performance RSUs: The amounts reported in the stock awards column for 2020 include the grant date fair value of PRSUs granted to Mr. Burns pursuant to his election to receive 50% of his 2020 long-term performance equity grant in the form of RSUs and 50% in stock options, that only vest upon the achievement of a pre-determined financial target over a multi-year performance period. The grant date fair value of the PRSUs was computed in accordance with FASB ASC Topic 718, and excludes the effects of estimated forfeitures. The PRSUs are valued based on the probable outcome of the applicable performance conditions as determined on the grant date, which results in a grant date fair value for the PRSUs of $1,174,994 for Mr. Burns. The probable outcome of the applicable performance conditions also constitutes the highest level of performance under the PRSUs for the first year of the multi-year performance period. For a more detailed description of these grants of the PRSUs, please see “Material Elements of Compensation—Long-Term Incentive Compensation” in the Compensation Discussion and Analysis section above.

(4)The amount reported in the column for Mr. Calcaterra for 2020 includes amounts that were deferred under our Deferred Compensation Plan described below.
(5)Consists of Company matching contributions to the executive’s 401(k) plan contributions and the Company’s payment for an annual executive physical; in March 2020, the Company suspended its 401(k) matching contributions as part of its COVID-19 cost savings response plan. The Company resumed 401(k) matching contributions in 2021. No NEO received an executive physical in 2020.
(6)The base salary amounts for Messrs. Burns and Calcaterra for 2019 and 2020 include the amounts that were deferred under our Deferred Compensation Plan described below.

Executive Employment Offer Letters

On July 10, 2014, we entered into employment offer letters with Messrs. Burns and Calcaterra, and on February 3, 2017, we entered into an offer letter with Mr. Gilliam. The offer letters provide Messrs. Burns and Calcaterra with an annual base salary of $525,000 and $320,000, respectively, and a target bonus opportunity of 70% and 40% of base salary, respectively. Mr. Gilliam’s offer letter provides him an annual base salary of $360,000 and a target bonus opportunity of 50% of base salary. As described above in the Compensation Discussion and Analysis, each executive’s annual bonus is based upon the achievement of specific corporate or individual performance objectives determined by our Board. Base salary and bonus opportunity percentages are reviewed by our Board at least annually for adjustments.

Messrs. Burns, Calcaterra and Gilliam are also entitled to receive all employee benefits that we customarily make available to employees in comparable positions, including participation in our equity plans. Additionally, Messrs. Burns, Calcaterra and Gilliam continue to be subject to the patent, copyright and non-disclosure restrictive covenants agreement each executed at the time of employment. None of our NEOs entered into a new or amended employment agreement with the Company since the date of our 2020 Annual Meeting of Stockholders.

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2020 Grants of Plan-Based Awards

The following table summarizes information about the non-equity incentive awards and equity-based awards granted to our Named Executive Officers in 2020:

2020

2020

Exercise

Estimated Future Payouts Under

Estimated Future Payouts Under

Stock Awards:

Option Awards:

or Base

Grant Date

Non-Equity Incentive Plan

Equity Incentive Plan

Number of

Number of

Price of

Fair Value

Award ($)(1)

Awards (#)(1)

Shares

Securities

Option

of Stock and

Grant

Threshold

Target

Maximum

Threshold

Target

Maximum

of Stock or

Underlying

Awards

Option

Name

  

Date

  

($)

  

($)

  

($)

  

  

  

  

Units (#)

  

Options (#)

  

($/Sh)

  

Awards ($)(2)

Thomas W. Burns

Time-Based Options

3/12/2020

65,170

39.10

 

1,175,015

Time-Based RSUs

3/12/2020

30,052

1,175,033

Performance Options

3/12/2020

32,585

65,169

130,338

39.10

1,174,997

PRSUs

3/12/2020

15,026

30,051

60,102

1,174,994

Annual Cash Bonus

4/1/2020

338,000

676,000

1,352,000

Discretionary Bonus RSUs

12/17/2020

1,463

106,784

Make-Whole RSUs

12/17/2020

926

67,589

Chris M. Calcaterra

Time-Based Options

3/12/2020

51,769