DEF 14A 1 mnta2019proxystatement.htm DEF 14A Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
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Soliciting Material under §240.14a‑12







Momenta Pharmaceuticals, Inc.
(Name of Registrant as Specified In Its Charter)
 
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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MOMENTA PHARMACEUTICALS, INC.
301 Binney Street
Cambridge, Massachusetts 02142
April 24, 2020
To Our Stockholders:
You are cordially invited to attend the 2020 Annual Meeting of Stockholders of Momenta Pharmaceuticals, Inc. to be held at 10:30 a.m., Eastern time, on Tuesday, June 23, 2020. The Annual Meeting will be a completely virtual meeting, which will be conducted via live webcast. You will be able to attend the Annual Meeting online and submit your questions during the meeting by visiting www.virtualshareholdermeeting.com/MNTA2020.
The Notice of Meeting and Proxy Statement on the following pages describe the matters to be presented at the meeting.
It is important that your shares be represented at this meeting to assure the presence of a quorum. Whether or not you plan to attend the meeting online, we hope that you will have your stock represented by voting your shares over the Internet or by telephone as provided in the instructions set forth on the enclosed proxy card, or by completing, signing, dating and returning your proxy in the enclosed envelope, as soon as possible. Your stock will be voted in accordance with the instructions you have given in your proxy.
Thank you for your continued support.
 
Sincerely,
 
craigsignaturea01.jpg
 
Craig A. Wheeler
President and Chief Executive Officer








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MOMENTA PHARMACEUTICALS, INC.
301 Binney Street
Cambridge, Massachusetts 02142
NOTICE OF 2020 ANNUAL MEETING OF STOCKHOLDERS
To Be Held on June 23, 2020
To Our Stockholders:
NOTICE IS HEREBY GIVEN that the 2020 Annual Meeting of Stockholders of Momenta Pharmaceuticals, Inc., or the Annual Meeting, will be held on Tuesday, June 23, 2020, at 10:30 a.m., Eastern time. The Annual Meeting will be a completely virtual meeting, which will be conducted via live webcast. You will be able to attend the Annual Meeting online and submit your questions during the meeting by visiting www.virtualshareholdermeeting.com/MNTA2020.At the Annual Meeting, stockholders will consider and vote on the following matters:
1.
to elect Bruce L. Downey and Georges Gemayel to our board of directors to serve as Class I directors, each for a term of three years;
2.
to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020;
3.
to approve, on an advisory (non‑binding) basis, the compensation of our named executive officers; and
4.
to approve the amendment and restatement of the Momenta Pharmaceuticals, Inc. 2013 Incentive Award Plan, which, among other things, increases the number of shares authorized for issuance by 7,000,000 shares.
The stockholders will also act on any other business that may properly come before the Annual Meeting or any postponement, continuation or adjournment thereof.
Stockholders of record at the close of business on Monday, April 27, 2020, are entitled to notice of, and to vote at, the Annual Meeting or any postponement, continuation or adjournment thereof. The list of these stockholders will be available on the bottom of your screen during the Annual Meeting after entering the 16-digit control number included on the proxy card that you received, or on the materials provided by your bank or broker. Your vote is important regardless of the number of shares you own.
We hope that all stockholders will be able to attend the Annual Meeting online. However, to ensure that a quorum is present at the Annual Meeting, please vote your shares over the Internet or by telephone as provided in the instructions set forth on the enclosed proxy card, or complete, date, sign and promptly return the enclosed proxy card whether or not you expect to attend the Annual Meeting online. A postage‑prepaid envelope, addressed to Broadridge Financial Solutions, which is serving as proxy tabulator, has been enclosed for your convenience. Your proxy may be revoked by voting electronically at the Annual Meeting (although attendance at the Annual Meeting will not in and of itself constitute a revocation of a proxy). Note that, in light of possible disruptions in mail service related to the COVID-19 outbreak, we encourage stockholders to submit their proxy via telephone or online.






 
By Order of the Board of Directors,
 
alejandrasignature2a01.jpg
 
Alejandra Carvajal
Secretary
Cambridge, Massachusetts
April 24, 2020






Table of Contents









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MOMENTA PHARMACEUTICALS, INC.
301 BINNEY STREET
CAMBRIDGE, MASSACHUSETTS 02142
PROXY STATEMENT
For the 2020 Annual Meeting of Stockholders
To Be Held on Tuesday, June 23, 2020
GENERAL INFORMATION ABOUT VOTING
This proxy statement and the enclosed proxy card are being furnished in connection with the solicitation of proxies by the board of directors of Momenta Pharmaceuticals, Inc., also referred to in this proxy statement as the “Company”, “Momenta”, “we” or “us”, for use at the 2020 Annual Meeting of Stockholders to be held on Tuesday, June 23, 2020, at 10:30 a.m., Eastern time, and at any postponement, continuation or adjournment thereof. The Annual Meeting will be a completely virtual meeting, which will be conducted via live webcast. You will be able to attend the Annual Meeting online and submit your questions during the meeting by visiting www.virtualshareholdermeeting.com/MNTA2020 and entering your 16-digit control number included in your enclosed proxy card.
Our 2019 Annual Report to Stockholders for the fiscal year ended December 31, 2019 is being mailed to stockholders with the mailing of these proxy materials on or about May 6, 2020.
Important Notice Regarding the Availability of Proxy Materials for the Annual
Meeting of Stockholders To Be Held on June 23, 2020:
This proxy statement and our 2019 Annual Report on Form 10K to Stockholders are available for viewing, printing and downloading at https://www.momentapharma.com/investors-and-news/financialinformation/annual-reportsandproxies.
A copy of our Annual Report on Form 10K for the fiscal year ended December 31, 2019 as filed with the Securities and Exchange Commission, except for exhibits, will be furnished without charge to any stockholder upon request to Momenta Pharmaceuticals, Inc., 301 Binney Street, Cambridge, Massachusetts 02142, Attention: Alejandra Carvajal, facsimile: (617) 621‑0431, by calling (617) 491‑9700 or is available on our website at https://www.momentapharma.com/investors-and-news/financialinformation/annual-reportsandproxies.
As part of our effort to maintain a safe and healthy environment for our directors, members of management and stockholders who wish to attend the Annual Meeting, in light of the novel coronavirus disease, COVID-19, Momenta believes that holding the Annual Meeting entirely online this year is in the best interest of the Company and its stockholders. A virtual meeting also enables increased stockholder attendance and participation because stockholders can participate from any location around the world. You may attend the Annual Meeting online only if you are a Momenta stockholder who is entitled to vote at the Annual Meeting, or if you hold a valid proxy for the Annual Meeting. You may attend and participate in the Annual Meeting by visiting the following website: www.virtualshareholdermeeting.com/MNTA2020. To attend and participate in the Annual Meeting, you will need the 16-digit control number included in your Proxy Card or on the instructions that accompanied your proxy materials. If your shares are held in “street name,” you should contact your bank or broker to obtain your 16-digit control number or otherwise vote through the bank or broker. If you lose your 16-digit control number, you may join the Annual Meeting as a “Guest” but you will not be able to vote, ask questions or access the list of stockholders as of the Record Date. The meeting webcast will begin promptly at 10:30 a.m. Eastern time. We encourage you to access the meeting prior to the start time. Online check-in will begin at 10:25 a.m., Eastern time, and you should allow ample time for the check-in procedures.

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Momenta’s Voting Securities
Holders of record of our common stock at the close of business on Monday, April 27, 2020, will be entitled to notice of, and to vote at, the Annual Meeting or any postponement, continuation or adjournment of the Annual Meeting. On April 17, 2020, 117,639,406 shares of our common stock were issued and outstanding. The list of these stockholders will be available on the bottom of your screen during the Annual Meeting after entering the 16-digit control number included on the proxy card that you received, or on the materials provided by your bank or broker. Each share of common stock entitles the holder thereof to one vote with respect to all matters submitted to stockholders at the Annual Meeting. We have no other securities entitled to vote at the Annual Meeting.
Voting Your Shares
If you are the record holder of your shares, you may vote in one of four ways. You may vote by submitting your proxy over the Internet, by telephone, or by mail or you may vote online at the Annual Meeting. A 16‑digit control number that is provided on the enclosed proxy card is needed for voting over the telephone or Internet.
You may vote over the Internet. If you have Internet access, you may vote your shares from any location in the world by following the “Vote by Internet” instructions set forth on the enclosed proxy card.
You may vote by telephone. You may vote your shares by following the “Vote by Phone” instructions set forth on the enclosed proxy card.
You may vote by mail. You may vote by completing, dating and signing the proxy card that accompanies this proxy statement and promptly mailing it in the enclosed postage‑prepaid envelope. You do not need to put a stamp on the enclosed envelope if you mail it in the United States.
You may vote online at the Annual Meeting. You will need to obtain your own Internet access if you choose to attend the Annual Meeting online and vote over the Internet. To participate in the Annual Meeting, including to vote electronically during the Annual Meeting, you will need the 16-digit control number included on your enclosed proxy card.
If the shares you own are held in your bank or brokerage firm account in a fiduciary capacity (typically referred to as being held in “street name”), you can vote by following the directions provided to you by your bank or brokerage firm. If the shares you own are held in street name and you wish to vote online at the Annual Meeting, you must obtain your 16-digit control number or otherwise vote through the bank or broker. Please contact the organization that holds your shares for instructions on how to obtain your 16-digit control number or otherwise vote through the broker or other nominee. If you lose your 16-digit control number, you may join the Annual Meeting as a “Guest” but you will not be able to vote, ask questions or access the list of stockholders as of the Record Date.
Your Voting Instructions
The shares represented by all valid proxies will be voted as specified in those proxies. If the shares you own are held in your name and you return a duly executed proxy without specifying how your shares are to be voted, they will be voted as follows in accordance with the recommendations of our board of directors:
FOR the election of Bruce L. Downey and Georges Gemayel as Class I directors;
FOR the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020;
FOR the approval, on an advisory (non‑binding) basis, of the compensation of our named executive officers;
FOR the approval of the amendment and restatement of the Momenta Pharmaceuticals, Inc. 2013 Incentive Award Plan; and

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in the discretion of the persons appointed as proxies on any other items that may properly come before the Annual Meeting.
If the shares you own are held in street name, the bank or brokerage firm, as the record holder of your shares, is required to vote your shares in accordance with your instructions. You should direct your broker how to vote the shares held in your account. Under applicable stock exchange rules, if you do not instruct your broker on how to vote your shares, your broker will be able to vote your shares with respect to certain “routine” matters, but will not be allowed to vote your shares with respect to certain “non‑routine” matters. The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm is a routine matter. Each other proposal to be voted on at the Annual Meeting is a non‑routine matter. A broker “non‑vote” occurs when a broker submits a proxy form but declines to vote on a particular matter because the broker has not received voting instructions from the beneficial owner.
Revoking Your Proxy or Changing Your Vote
Voting over the Internet or by telephone or execution of a proxy will not in any way affect a stockholder’s right to attend the Annual Meeting and vote online. A proxy may be revoked before it is used to cast a vote. If the shares you own are held in your name, you can revoke a proxy by doing one of the following:
file with our Secretary, at or before the taking of the vote at the Annual Meeting, a written notice of revocation bearing a later date than the proxy;
duly execute a later‑dated proxy relating to the same shares and deliver it to our Secretary before the taking of the vote; or
attend the Annual Meeting and vote in person. However, your attendance at the Annual Meeting will not automatically revoke your proxy unless you vote again electronically at the Annual Meeting.
Any written notice of revocation or subsequent proxy should be sent to us at the following address: Momenta Pharmaceuticals, Inc., 301 Binney Street, Cambridge, Massachusetts 02142, Attention: Alejandra Carvajal, Secretary.
If the shares you own are held in street name, you will need to follow the directions provided to you by your bank or brokerage firm to change your vote.
Votes Required
The presence online at the Annual Meeting or representation by proxy of the holders of a majority of the shares of common stock of Momenta issued and outstanding and entitled to vote at the Annual Meeting is necessary to establish a quorum for the transaction of business. If a quorum is not present, the Annual Meeting will be adjourned until a quorum is obtained.
The proposal regarding the election of directors requires, for each director nominee, that the votes cast for such nominee exceed the votes cast against such nominee. This means that each of the director nominees for election at our Annual Meeting must receive more “FOR” votes than “AGAINST” votes in order to be elected as a Class I director. The ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm, the approval, on an advisory (non‑binding) basis, of the compensation of our named executive officers, and the approval of the amendment and restatement of the Momenta Pharmaceuticals, Inc. 2013 Incentive Award Plan, each require the approval of a majority in voting power of the votes cast affirmatively or negatively by the holders entitled to vote on the proposal. The votes will be counted, tabulated and certified by a representative of Broadridge Financial Solutions, the Company’s inspector of elections for the Annual Meeting.
Counting of Votes
Abstentions and broker non‑votes are included in the shares present or represented at the Annual Meeting for purposes of determining whether a quorum is present. With respect to the election of directors, abstentions and broker non‑votes will not affect the voting results. With respect to the proposal regarding the ratification of the appointment of the Company’s independent registered public accounting firm, abstentions will not affect the voting results. Because brokers have discretionary authority to vote on the ratification of the independent registered public accounting firm, we do not expect

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any broker non‑votes in connection with the ratification. With respect to all other proposals to be voted on at the Annual Meeting, abstentions and broker non‑votes will not affect the voting results.
Technical Difficulties or Trouble Accessing the Virtual Meeting Website

We will have technicians ready to assist you with any technical difficulties you may have accessing the virtual meeting website, and the information for assistance will be located on www.virtualshareholdermeeting.com/MNTA2020.
Questions and Answers Session During the Annual Meeting
As part of the Annual Meeting, we will hold a live Q&A session, during which we intend to answer questions submitted during the meeting that are pertinent to the Company and the meeting matters, as time permits.



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PROPOSAL ONE—
ELECTION OF DIRECTORS
Board Recommendation
The board of directors recommends a vote FOR the election of each of Bruce L. Downey and Georges Gemayel as Class I directors.
We have three classes of directors, currently consisting of three Class I directors, three Class II directors and three Class III directors. At each annual meeting, directors are elected for a term expiring on the date of the third annual meeting following the annual meeting at which they are elected. The terms of the three classes are staggered in a manner so that only one class is elected by stockholders annually. Bruce L. Downey and Georges Gemayel are currently serving as Class I directors, and are being nominated by the board of directors for re‑election as Class I directors at the Annual Meeting. As previously disclosed, Mr. Fishman is not standing for re-election at the Annual Meeting. The Class I directors elected this year will serve as members of our board of directors until the 2023 annual meeting of stockholders and until their respective successors are elected and qualified or their earlier death, resignation or removal. Proxies cannot be voted for a greater number of persons than the number of nominees named in this proposal.
In accordance with our corporate governance guidelines, if either of the directors nominated for re‑election at the Annual Meeting fail to receive more votes cast “FOR” his or her re‑election than “AGAINST” his or her re‑election, such director must promptly tender his or her resignation for the board of directors’ consideration. Our nominating and corporate governance committee or a committee of independent directors designated by our board of directors will then make a recommendation to our board of directors to accept or reject the tendered resignation. Our board of directors will have 90 days from the date the election results from our Annual Meeting are certified to notify the resigning director of its decision. Our board of directors may consider all relevant factors in making its decision, including any stated reasons for “AGAINST” votes, whether the underlying cause of the “AGAINST” votes are curable, the length of service and contributions to the Company of the resigning director, and whether the resignation would cause us to fail to comply with any applicable rules or requirements, would lead to a “change of control” as determined pursuant to any financing or other material agreement, or would cause us to default under any material agreements. If the resigning director’s tendered resignation is not accepted or the director does not otherwise submit his resignation, such director will continue to serve on our board of directors until his successor is duly elected and qualified, or his earlier resignation or removal. If the resigning director’s tendered resignation is accepted by our board of directors, then our board of directors, in its sole discretion, may fill any resulting vacancy or decrease the size of the board in accordance with our bylaws.
The persons named in the enclosed proxy card will vote as directed on the proxy card (or through the Internet or telephonic voting) or, if you return a duly executed proxy card without specifying how your shares are to be voted, the persons named in the enclosed proxy card will vote to elect Mr. Downey and Dr. Gemayel as Class I directors. Mr. Downey and Dr. Gemayel currently serve on our board of directors. The nominees have indicated their willingness to continue to serve if elected. However, if either director nominee should be unable to serve, or for good cause will not serve, the shares of common stock represented by proxies may be voted for a substitute nominee designated by our board of directors, or our board of directors may reduce its size. Our board of directors has no reason to believe that either of the nominees will be unable to serve if elected.
No director, nominee for election as a director or executive officer is related by blood, marriage or adoption to any other director, nominee for election as a director or executive officer. No arrangements or understandings exist between any director or nominee for election as a director and any other person pursuant to which such person is to be selected as a director or nominee for election as a director.


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Our Board of Directors
The biographies of each of our current Class II and Class III directors and the two Class I director nominees, are below. Each of the biographies also highlights specific experience, qualifications, attributes and skills that led our board of directors to conclude that such person should serve as a director. We also believe that all of our director nominees have a reputation for integrity, honesty and adherence to high ethical standards and have each demonstrated business acumen and an ability to exercise sound judgment, as well as a commitment of service to our Company and our board of directors.
Name
Age
Director
Since
Principal Occupation, Other Business Experience
During the Past Five Years and Other Directorships
Class I directors (terms to expire in 2023)

Bruce L. Downey(1)(2)

72
2009
Bruce L. Downey has been a director since June 2009 and has served as chairman of our board of directors since June 2018. Mr. Downey has served as a partner at NewSpring Capital, a venture capital firm, since April 2009. Previously, Mr. Downey was chairman and chief executive officer of Barr Pharmaceuticals, Inc., a global specialty pharmaceutical company that operated in more than 30 countries worldwide and was acquired by Teva Pharmaceutical Industries Ltd. in 2008. Mr. Downey is a member of the board of directors of Cardinal Health, Inc., serving on the nominating and corporate governance committee. Mr. Downey graduated with honors from Miami University in 1969 and received his law degree, cum laude, from Ohio State University. Mr. Downey’s qualifications to sit on our board of directors include his significant experience serving as a chief executive officer of a global generic pharmaceutical company that also had a substantial brand business and an active biologics research and development program, his years serving as a lawyer in private practice and his experience serving on other boards of directors in the biopharmaceutical industry.

Georges Gemayel(1)(3)

60
2016
Georges Gemayel, Ph.D., has been a director since January 2016. Since 2010, he has served as a consultant for several biotechnology companies and venture capital funds. From February 2011 to December 2012, Dr. Gemayel served as executive chairman of Syndexa Pharmaceuticals Corp., a privately held drug development company. Prior to that, in 2010, Dr. Gemayel served as executive chairman of FoldRx Pharmaceuticals, Inc. until its acquisition by Pfizer Inc. Dr. Gemayel received his doctorate in pharmacy from St. Joseph University in Beirut, Lebanon, and his Ph.D. in pharmacology from Paris‑Sud University in Paris, France. Dr. Gemayel currently serves as chairman of the boards of directors of several privately held companies, and on the boards of directors of Orphazyme ApS, serving as chairman of the board of directors and Supernus Pharmaceuticals, Inc., serving on the nominating and corporate governance and audit committees, both of which are publicly traded biotechnology companies. He was previously a director of publicly traded biotechnology companies, Dimension Therapeutics, Inc., which was acquired by Ultragenyx Pharmaceuticals, Inc., Raptor Pharmaceuticals, Inc., which was acquired by Horizon Pharma plc, Adolor Corporation, which was acquired by Cubist Pharmaceuticals, Inc., Prosensa Holding N.V., which was acquired by BioMarin Pharmaceutical Inc. and NPS Pharmaceuticals, Inc., which was acquired by Shire plc. Dr. Gemayel’s qualifications to sit on our board of directors include his over 30 years of experience in the biopharmaceutical industry, including management and executive positions.


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Class II directors (terms to expire in 2021)

Craig A. Wheeler

59
2006
Craig A. Wheeler has served as our president and a director since August 2006 and was appointed our chief executive officer effective September 2006. Prior to joining Momenta, Mr. Wheeler served as president of Chiron Biopharmaceuticals, a division of Chiron Corporation, a biotechnology company, from August 2001 until June 2006. Mr. Wheeler serves on the board of Amicus Therapeutics, Inc., including serving as chairman of the science and technology committee and on the compensation committee. Mr. Wheeler served as a director of Avanir Pharmaceuticals, Inc., which was acquired by Otsuka Pharmaceuticals Co., Ltd., from September 2005 to January 2015, including serving on the corporate governance and audit committees, and serving as chairman of the board beginning May 2007. Mr. Wheeler received B.S. and M.S. degrees in chemical engineering from Cornell University and an M.B.A. degree from the Wharton School of the University of Pennsylvania. Mr. Wheeler’s qualifications to sit on our board of directors include his years of senior executive management experience in the biotechnology industry, including over ten years as our president and chief executive officer, and his experience serving on other boards of directors in the biotechnology industry.

Donna R. Grogan(2)(4)
63
2019
Donna R. Grogan, M.D. has served a director since September 2019. Since July, 2019, Dr. Grogan has served as Principal of Grogan Consulting LLC, a private consulting firm. Previously, Dr. Grogan served as Chief Medical Officer of Clementia Pharmaceuticals, Inc., or Clementia, a biopharmaceutical company innovating new treatments for ultra-rare bone disorders and other diseases (acquired by Ipsen in April 2019), from September 2013 to June 2019. Prior to working at Clementia, Dr. Grogan served as chief medical officer for several Health Care Venture focused companies, including Anexon, Apofore and Declmmune. She previously worked at FoldRx Pharmaceuticals (acquired by Pfizer in October 2010) as chief medical officer and at Sepracor (now Sunovion) where she was senior vice president clinical research at the time of her departure. Dr. Grogan has made significant contributions to numerous successful new drug applications, including Lunesta®, Xopenex HFA®, BrovanaTM and most recently the European Medicines Agency authorization of Vyndaqel® (tafamidis) for the treatment of rare neurologic disease transthyretin familial amyloid polyneuropathy. Dr. Grogan received her B.A. in Psychology from College of the Holy Cross and earned her M.D. from the University of Illinois College of Medicine. Dr. Grogan’s qualifications to sit on the board include her 15 years’ of clinical practice experience as a board-certified physician, her leadership in numerous investigational new drug applications and her expertise in the design and execution of clinical programs across multiple therapeutic areas, including rare diseases.

Jose‑Carlos Gutiérrez‑Ramos(2)(4)


57
2016
Jose‑Carlos Gutiérrez‑Ramos, Ph.D., has served as a director since March 2016. Since February 2020, he has served as the Head of Global Drug Discovery at Abbvie, Inc. From June, 2018 to February, 2020 he was the chief executive officer and president of Cogen ImmuneMedicines, Inc., a biotechnology company. From 2015 to May 2018, he served as chief executive officer and president of Synlogic, Inc., a pharmaceutical company. Prior to joining Synlogic, Dr. Gutiérrez‑Ramos was group senior vice president of Worldwide Research and Development and global head of Biotherapeutics Research and Development at Pfizer Inc., a pharmaceutical company, from 2010 to 2015. Dr. Gutiérrez‑Ramos received a B.S. from Universidad Complutense de Madrid and his Ph.D. in immunochemistry from the Universidad Autonoma de Madrid. Dr. Gutiérrez‑Ramos’ qualifications to sit on our board of directors include his senior executive experience in the pharmaceutical industry, including his significant experience in research and development.


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Class III directors (terms to expire in 2022)
Jane Barlow(1)(3)
59
2019
Jane Barlow, M.D., M.P.H., M.B.A., has been a director since December 2019. Since January 2017, Dr. Barlow has served as Chief Executive Officer of Jane Barlow & Associates, LLC, a consulting firm focused on value based health care services. Since January 2017, Dr. Barlow has also served as executive vice president and chief clinical officer of Real Endpoints, a data, analytics, and advisory firm, and is a senior advisor to the MIT Center for Biomedical Innovation Project on Financing of Curative Therapies in the U.S. Previously, she was associate chief medical officer at CVS Health, from 2013 to December 2016, and chief medical officer of CVS Health’s government service arm. Dr. Barlow received her M.D. from Creighton University and completed her residency training in occupational and environmental medicine at The Johns Hopkins University, where she earned her M.P.H. Additionally, she holds an M.B.A. from the University of Alabama and is a distinguished graduate of the United States Air Force School of Aerospace Medicine. She is board-certified in occupational medicine and is a fellow of both the American College of Occupational and Environmental Medicine and the American College Preventive Medicine. Dr. Barlow's qualifications to sit on our board of directors includes her experience in clinical and commercial aspects of market access, payor reimbursement, health policy and health management.

Steven C. Gilman(2)(4)
67
2016
Steven C. Gilman, Ph.D., has been a director since June 2016. From March 2016 to April 2019, Dr. Gilman served as the chief executive officer of ContraFect Corporation, a publicly traded biotechnology company. Until 2015, he served as the executive vice president, Research & Development and chief scientific officer at Cubist Pharmaceuticals, a biopharmaceutical company, until its acquisition by Merck & Co. In addition to his service on ContraFect Corporation’s board of directors, where he served as chairman of the board of directors from May 2015 to April 2019, and currently serves as vice chairman, Dr. Gilman currently serves on the boards of directors of publicly traded biotechnology companies, Akebia Therapeutics, Inc., serving on the research and development committee, SCYNEXIS Inc., serving on the compensation and audit committees, and Vericel Corporation, serving on the compensation committee. Dr. Gilman served on the board of directors of Keryx Biopharmaceuticals, Inc. until its merger with Akebia in December 2018. Dr. Gilman received his Ph.D. and M.S. degrees in microbiology from Pennsylvania State University, his post‑doctoral training at Scripps Clinic and Research Foundation, and a B.A. in microbiology from Miami University of Ohio. Dr. Gilman’s qualifications to sit on our board of directors include his leadership experience in the biopharmaceutical industry, including his senior executive positions at ContraFect and Cubist and his experience serving on other boards of directors in the biotechnology industry.
Elizabeth Stoner(3)(4)
69
2007
Elizabeth Stoner, M.D., has been a director since October 2007. Since September 2012, Dr. Stoner has been the chief development officer at Vascular Pharmaceuticals, Inc., a biotechnology company. From 2010 to 2014, Dr. Stoner was the chief development officer of Rhythm Pharmaceuticals, Inc., and since December 2014, she has been a member of Rhythm’s Scientific Advisory Board. Since October 2007, Dr. Stoner has served as a managing director at MPM Capital, a healthcare venture capital firm. Prior to joining MPM Capital, Dr. Stoner had a distinguished 22‑year career at Merck Research Laboratories. At the time of her retirement from Merck, Dr. Stoner was senior vice president of Global Clinical Development Operations with responsibility for the company’s clinical development activities in more than 40 countries, including Merck’s Japanese subsidiary. Prior to her position at Merck, she was an assistant professor of Pediatrics at Cornell University Medical College. Dr. Stoner served on the board of Radius Health, Inc. from 2011 to 2015. Dr. Stoner received her B.S. in Chemistry from Ottawa University, KS, her M.S. in Chemistry from the State University of New York at Stony Brook, and her M.D. from Albert Einstein College of Medicine. Dr. Stoner’s qualifications to sit on our board of directors include her more than 20 years of senior executive experience in the pharmaceutical industry, including her expertise in leading clinical development organizations.


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(1)
Member of audit committee.
(2)
Member of compensation committee.
(3)
Member of nominating and corporate governance committee.
(4)
Member of the science committee.
For information relating to compensation of our directors, including shares of our common stock owned by and options granted to each of our directors, see the disclosure set forth under the headings “Director Compensation” and “Security Ownership of Certain Beneficial Owners and Management.”

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MOMENTA’S CORPORATE GOVERNANCE
General
We believe that good corporate governance is important to ensure that Momenta is managed for the long‑term benefit of our stockholders. We continuously review our corporate governance policies and practices, and compare them to those suggested by various authorities in corporate governance and the practices of other public companies.
This section describes key corporate governance practices that we have adopted, including the criteria we use in selecting director nominees, our board leadership structure and certain responsibilities and activities of the board of directors and its committees. Complete copies of our corporate governance guidelines, committee charters and code of conduct described below are available on the “Investors & News-Corporate Governance” section of our website at www.momentapharma.com. Alternatively, you may request a copy of any of these documents by writing to Momenta Pharmaceuticals, Inc., 301 Binney Street, Cambridge, Massachusetts 02142, Attention: Alejandra Carvajal, Secretary, fax: (617) 621‑0431.
Corporate Governance Guidelines
Our board of directors has adopted corporate governance guidelines to assist our directors in the exercise of their duties and responsibilities and to serve the best interests of Momenta and its stockholders. These guidelines, which provide a framework for the conduct of the board of directors’ business, provide, among other things, that:
the principal responsibility of the directors is to oversee the management of Momenta;
a majority of the members of the board of directors must be independent directors;
the independent directors will meet periodically, but not less than twice per year, in executive session without non-independent directors;
directors have full and free access to management and, as necessary and appropriate, independent advisors;
new directors will participate in an orientation program and all directors are expected to participate in continuing director education funded by the Company on an ongoing basis; and
the board of directors and its committees will conduct periodic self‑evaluations to evaluate whether they are functioning effectively.
Board Determination of Independence
Under applicable Nasdaq rules, a director will only qualify as an “independent director” if, in the opinion of our board of directors, that person does not have a relationship which would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Our board of directors has determined that none of Jane Barlow, Bruce L. Downey, Corey N. Fishman, Georges Gemayel, Steven C. Gilman, Donna R. Grogan, Jose‑Carlos Gutiérrez‑Ramos, and Elizabeth Stoner has a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is an “independent” director as that term is defined under applicable Nasdaq rules. The board of directors also determined that, during their respective service as directors, neither of Thomas P. Koestler and James R. Sulat had a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of Messrs. Koestler and Sulat was an “independent” director under applicable Nasdaq rules. Craig A. Wheeler is not an independent director under the Nasdaq rules due to his employment as our chief executive officer and president.
Board Leadership Structure
Our board separated the positions of chairman of the board and chief executive officer in 2005. Separating these positions allows our chief executive officer to focus on our day‑to‑day business, while allowing the chairman of the board to lead the board in its fundamental role of providing advice to and independent oversight of management and corporate governance. The board recognizes the time, effort, and energy that the chief executive officer is required to devote to his position, and further recognizes the commitment required to serve as chairman of the board, particularly as the board’s oversight responsibilities continue to grow. While our by‑laws and corporate governance guidelines do not require that our

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chairman and chief executive officer positions be separate, the board believes that our practice of having separate positions and having an independent outside director serve as chairman is the appropriate leadership structure for the Company at this time. However, in the event that in the future the chairman of the board is not an independent director, our corporate governance guidelines provide that the nominating and corporate governance committee may nominate an independent director to serve as “Lead Director” who would be approved by a majority of the independent directors.
The Board’s Role in Risk Oversight
Our board of directors administers its risk oversight function directly and through our board committees. The audit committee’s role in the risk oversight process includes receiving regular reports from our compliance officer, who oversees our compliance program, members of senior management on our compliance committee who have functional compliance responsibility, and other members of senior management on areas of material risk to us, including operational, financial, legal, regulatory, strategic, cyber and reputational risks, as well as, more recently, the risk exposures related to the coronavirus (COVID-19) pandemic. The audit committee receives these reports from the appropriate compliance “risk owner” within the Company to enable the audit committee to understand our risk identification, risk management and risk mitigation strategies. The chair of the audit committee reports on these discussions to the full board during each regularly‑scheduled board meeting. Management is actively assessing the impact of the COVID-19 pandemic and reporting to the board on an as needed basis. The compensation committee assists the board in fulfilling its oversight responsibilities with respect to the management of risks arising from our compensation policies and programs. The nominating and governance committee assists the board in fulfilling its oversight responsibilities with respect to corporate enterprise risk management as well as the management of risks associated with board organization, membership and structure, succession planning for our directors and executive officers, corporate governance, and potential legal issues that may impact the Company, and also by reviewing the code of business conduct and ethics which creates a foundation for our compliance program. Our board of directors does not believe that its role in the oversight of our risks affects the board’s leadership structure.
Board Meetings and Attendance
Our board of directors met 5 times during the fiscal year ended December 31, 2019, either in person or by teleconference. During 2019, each director, except for Dr. Koestler, attended at least 75% of the aggregate of the total number of board meetings and committee meetings on which she or he then served.
Director Attendance at Annual Meetings of Stockholders
Our corporate governance guidelines provide that directors are expected to attend the annual meeting of stockholders. All of our then‑current directors attended the 2019 annual meeting of stockholders.
Board Committees
Our board of directors has established four standing committees-audit, compensation, nominating and corporate governance and science-each of which operates under a charter that has been approved by our board of directors. Current copies of the audit, compensation, nominating and corporate governance and science committee charters are posted on the “Investors & News-Corporate Governance” section of our website located at www.momentapharma.com.
Our board of directors has determined that all of the members of each of the audit, compensation and nominating and corporate governance committees are independent as defined under applicable Nasdaq rules, including, in the case of all members of the audit committee, the independence requirements contemplated by Rule 10A‑3 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, and, in the case of all members of the compensation committee, the Nasdaq rules specific to the independence of compensation committee members.
Audit Committee
The audit committee currently consists of Jane Barlow, Bruce L. Downey, Corey N. Fishman, and Georges Gemayel. Mr. Fishman chairs the audit committee. As noted above, Mr. Fishman is not standing for re-election at the Annual Meeting. Mr. Downey will succeed Mr. Fishman as chair of the audit committee, effective at the conclusion of the Annual Meeting. The audit committee held 8 meetings in 2019. Our audit committee’s responsibilities include:
appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm;

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overseeing the work of our independent registered public accounting firm, including the receipt and consideration of reports from the firm;
reviewing and discussing with management our annual and quarterly financial statements and related disclosures;
monitoring our internal control over financial reporting and disclosure controls and procedures;
discussing and monitoring our corporate compliance program and financial and accounting risk management policies;
establishing and periodically reviewing procedures for the receipt and retention of accounting related complaints and concerns;
meeting with management and independently with our independent registered public accounting firm;
reviewing and approving or ratifying any related person transactions; and
preparing the audit committee report required by Securities and Exchange Commission rules, which is included below under “Report of the Audit Committee.”
Our board of directors has determined that each of Jane Barlow, Bruce L. Downey, and Corey N. Fishman is an “audit committee financial expert” as defined by applicable Securities and Exchange Commission rules.
Compensation Committee
The compensation committee currently consists of Bruce L. Downey, Steven C. Gilman, Donna R. Grogan and Jose‑Carlos Gutiérrez‑Ramos. Dr. Gilman chairs the compensation committee. The compensation committee held 8 meetings in 2019. Our compensation committee’s responsibilities include:
reviewing and approving, or recommending for board approval, the compensation of our chief executive officer and our other executive officers;
overseeing an evaluation of our senior executives;
reviewing and making recommendations to the board of directors with respect to incentive-compensation and equity-based plans that are subject to approval by the board of directors;
overseeing and administering our stock option, stock incentive, employee stock purchase and other equity-based plans;
reviewing and making recommendations to the board of directors with respect to director compensation;
reviewing and discussing annually with management our “Compensation Discussion and Analysis,” which is included below; and
preparing the compensation committee report required by Securities and Exchange Commission rules, which is included below under “Compensation Committee Report.”
The compensation committee may delegate its authority to one or more subcommittees as it deems appropriate. The processes and procedures followed by our compensation committee in considering and determining executive compensation are described below under the heading “Executive Compensation Processes.”
Nominating and Corporate Governance Committee
Our nominating and corporate governance committee currently consists of Jane Barlow, Corey N. Fishman, Georges Gemayel and Elizabeth Stoner. As noted above, Mr. Fishman is not standing for re-election at the Annual Meeting. Dr. Gemayel chairs the nominating and corporate governance committee. The nominating and corporate governance committee held 4 meetings in 2019. Our nominating and corporate governance committee’s responsibilities include:

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identifying individuals qualified to become board members;
recommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees;
monitoring and assessing the independence of existing directors and all director nominees under applicable Nasdaq rules and in accordance with the Company’s corporate governance guidelines;
overseeing an annual review by the board of directors with respect to management succession planning;
reviewing and assessing our code of business conduct and ethics;
overseeing our enterprise risk management program;
reviewing and assessing the adequacy of the Company’s corporate governance principles; and
overseeing a periodic self‑evaluation of the board of directors.
The processes and procedures followed by our nominating and corporate governance committee in identifying and evaluating director candidates are described below under the heading “Director Nomination Process.”
Science Committee
Our science committee currently consists of Steven C. Gilman, Donna R. Grogan, Jose‑Carlos Gutiérrez‑Ramos and Elizabeth Stoner. Dr. Stoner chairs the science committee. The science committee held 4 meetings in 2019. Our science committee’s responsibilities include:
reviewing the scientific, clinical, regulatory and intellectual property strategies that underlie our major research and development programs;
reviewing the annual research and development budget and allocation of resources to certain of our programs;
reviewing the capability and skill set of the research and development organization; and
reviewing the attainment of research and development milestones.
Compensation Committee Interlocks and Insider Participation
The compensation committee currently consists of Bruce L. Downey, Steven C. Gilman, Donna R. Grogan and Jose‑Carlos Gutiérrez‑Ramos. Dr. Gilman chairs the compensation committee. No member of our compensation committee is or has been an officer or employee of the Company.
During 2019, none of our executive officers served as a member of the board of directors or compensation committee, or other committee serving an equivalent function, of any other entity that has one or more of its executive officers serving as a member of our board of directors or compensation committee.
Report of the Audit Committee
The audit committee has reviewed our audited consolidated financial statements for the fiscal year ended December 31, 2019 and has discussed these consolidated financial statements with our management and our independent registered public accounting firm. Management is responsible for the preparation of our consolidated financial statements and for maintaining an adequate system of disclosure controls and procedures and internal control over financial reporting for that purpose. Our independent registered public accounting firm is responsible for conducting an independent audit of our annual consolidated financial statements in accordance with generally accepted auditing standards and issuing a report on the results of their audit. The audit committee is responsible for providing independent, objective oversight of these processes.
The audit committee has also received from, and discussed with, our independent registered public accounting firm various communications that they are required to provide to the audit committee, including the matters required to be

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discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the Securities and Exchange Commission.
Our independent registered public accounting firm also provided the audit committee with the written disclosures and letter required by applicable requirements of the PCAOB regarding the independent accountant’s communications with the audit committee concerning independence, and our audit committee has discussed with our independent registered public accounting firm its independence.
Based on the review and discussions referred to above, the audit committee recommended to our board of directors that the audited consolidated financial statements be included in our Annual Report on Form 10‑K for the year ended December 31, 2019 for filing with the Securities and Exchange Commission.
By the Audit Committee of the Board of Directors of Momenta Pharmaceuticals, Inc.:
Corey N. Fishman (Chair)
Jane Barlow
Bruce L. Downey
Georges Gemayel
Executive Compensation Processes
We have implemented an annual performance review program for our employees, including our executives, with annual corporate goals that are proposed by management, reviewed by the compensation committee and approved by the board of directors. These corporate goals target the achievement of specified operational and financial goals; specific research, clinical, regulatory, commercial and/or compliance milestones; and business development and financing initiatives. Individual performance is evaluated in part by reviewing the extent to which an employee’s performance facilitates the achievement of our annual corporate and business goals. Annual salary adjustments, annual incentive cash bonus awards and equity awards for each of our chief executive officer, chief financial officer, and each of our three other most highly compensated executive officers are tied to a combination of achievement of corporate goals and individual performance.
The compensation committee has the authority to retain compensation consultants and other outside advisors to assist in the evaluation of executive officer compensation. To assist the compensation committee in discharging its responsibilities, since mid‑2010, the compensation committee has retained Radford, which is part of the Rewards Solutions practice at Aon plc, an independent compensation consultant that we refer to as Radford, to evaluate certain aspects of our compensation practices and assist the compensation committee with setting executive compensation.
For further information about our executive compensation, please see the “Executive Compensation-Compensation Discussion and Analysis” section below.
Director Nomination Process
The process followed by our nominating and corporate governance committee to identify and evaluate director candidates includes requests to board members for recommendations as well as use of a third‑party professional search firm. The committee meets from time to time to evaluate biographical information and background material relating to potential candidates as well as to discuss the results of interviews of selected candidates by members of the nominating and corporate governance committee and other members of the board of directors.
In considering whether to recommend any particular candidate for inclusion in the board’s slate of director nominees, the nominating and corporate governance committee applies the criteria attached to its charter. These criteria include the candidate’s integrity, business acumen, commitment to understanding our Company and our industry, experience, diligence and the ability to act in the interests of all stockholders. The nominating and corporate governance committee also considers whether a candidate has any conflicts of interest that would impair his or her ability to represent the interests of our stockholders and to fulfill the responsibilities of a director. The criteria further specify that the board should encompass individuals with diverse backgrounds and perspectives. While we do not have a formal policy on diversity, the nominating and corporate governance committee proactively seeks nominees with a broad diversity of viewpoints, backgrounds experiences, expertise and other demographics and characteristics (including gender, age, race and ethnicity) and considers such factors in evaluating prospective nominees, with the objective of recommending a group that it believes can best perpetuate the success of Momenta’s business. The nominating and corporate governance committee does not assign specific weights to particular criteria and no particular trait is a prerequisite for each prospective nominee. The nominating and corporate governance

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committee monitors the mix of specific experience, qualifications and skills of its directors in order to assure that the board of directors, as a whole, has the necessary tools to perform its oversight function effectively in light of the Momenta’s business and structure. Nominees are not discriminated against on the basis of race, religion, national origin, gender, sexual orientation, disability or any other basis proscribed by law.
Stockholders may recommend individuals to the nominating and corporate governance committee for consideration as potential director candidates by submitting their names, together with appropriate biographical information and background materials and a statement as to whether the stockholder or group of stockholders making the recommendation has beneficially owned more than 5% of our common stock for at least a year as of the date such recommendation is made, to the nominating and corporate governance committee, c/o Alejandra Carvajal, Secretary, Momenta Pharmaceuticals, Inc., 301 Binney Street, Cambridge, Massachusetts 02142. Assuming that appropriate biographical and background material has been provided on a timely basis, the nominating and corporate governance committee will evaluate stockholder‑recommended candidates by following substantially the same process, and applying substantially the same criteria, as it follows for candidates submitted by others.
Stockholders also have the right under our by‑laws to directly nominate director candidates, without any action or recommendation on the part of the nominating and corporate governance committee or the board of directors, by following the procedures set forth in our by‑laws that are described below under the heading “Additional Information-Stockholder Proposals.”
Stockholder Communications
Our board of directors will give appropriate attention to written communications that are submitted by stockholders and will respond if and as appropriate. The chairman of the board of directors (an independent director) or otherwise the chair of the nominating and corporate governance committee, subject to advice and assistance from the general counsel and secretary and, if requested, outside legal counsel, is primarily responsible for monitoring communications from stockholders and for providing copies of summaries of such communications to the other directors as he or she considers appropriate.
Under procedures approved by a majority of the independent directors, communications are forwarded to all directors if they relate to important substantive matters and include suggestions or comments that the chairperson of the board considers to be important for the directors to know. In general, communications relating to corporate governance and corporate strategy are more likely to be forwarded than communications relating to ordinary business affairs, personal grievances and matters as to which we tend to receive repetitive or duplicative communications.
Stockholders who wish to send communications on any topic to the board of directors should address such communications to the board of directors c/o Alejandra Carvajal, Secretary, Momenta Pharmaceuticals, Inc., 301 Binney Street, Cambridge, Massachusetts 02142, fax: (617) 621‑0431.
Code of Business Conduct and Ethics
Our written code of business conduct and ethics applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. The code is intended to deter wrongdoing and to promote the conduct of all Company business in accordance with high standards of integrity and in compliance with all applicable laws and regulations. The code covers a wide range of professional conduct, including compliance with laws and regulations applicable to the conduct of our business, conflicts of interest, insider trading, the protection of confidential information, honest and ethical fair dealing, acceptance and giving of gifts and gratuities, accuracy of our books and records, concerns regarding accounting matters, dealings with our independent auditor, and reporting and compliance procedures.
Prohibition of Hedging or Pledging the Company’s Securities
Our Board has adopted an Insider Trading Policy that applies to all of the Company’s employees, officers and directors. The policy prohibits our employees, officers and directors, their family members and any entities they control from purchasing financial instruments, such as prepaid variable forward contracts, equity swaps, collars, and exchange funds, or otherwise engaging in transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of the Company’s equity securities, whether such securities were granted as compensation or are otherwise held, directly or indirectly.

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Succession Planning
Our management conducts formal succession planning for our chief executive officer and other executive officers, which is reviewed at least annually by the board of directors under the oversight of the nominating and corporate governance committee.
Our Executive Officers
The following table sets forth the names, ages and positions of our current executive officers:
Name
Age
Position
Craig A. Wheeler*
59
President and Chief Executive Officer
Young Kwon, Ph.D.
48
Chief Financial and Business Officer
Agnieszka Cieplinska
43
Chief Accounting Officer
Anthony Manning, Ph.D.
58
Chief Scientific Officer
Santiago Arroyo, M.D., Ph.D.
60
Chief Medical Officer
Alejandra Carvajal
46
Chief Legal Officer, General Counsel and Secretary
Ian Fier
53
Chief Manufacturing and Program Officer
Jo‑Ann Beltramello
52
Chief Human Resources and Infrastructure Officer

*
Mr. Wheeler is a member of our board of directors. See “Proposal One-Election of Directors” for more information about Mr. Wheeler.
Young Kwon has been our Chief Financial and Business Officer since January 2020. Prior to that, he served as our Chief Business Officer since October 2018. From August 2015 to October 2018, Dr. Kwon served as our Senior Vice President, Corporate Development and Strategy. From January 2011 to July 2015, Mr. Kwon served as our Vice President, Corporate Development and Strategy. Prior to joining us, Mr. Kwon was Senior Director of Business Development at Biogen Idec, where he led corporate development activities, including evaluation of mergers and acquisitions, joint ventures and other strategic transactions. Prior to that, he identified and invested in early‑stage life science companies at Advanced Technology Ventures. Mr. Kwon received his B.S. from the Massachusetts Institute of Technology in 1994 and his Ph.D. in Biological Chemistry and Molecular Pharmacology from Harvard University in 1999.
Agnieszka Cieplinska, has been our Chief Accounting Officer since February 2020. Prior to that, she served as our Vice President of Finance and Corporate Controller since April 2019, and has served as our principal accounting officer since January 2020. Prior to joining Momenta, from August 2018 to April 2019 she was Vice President, Corporate Controller at Merus N.V., a biotechnology company and, from March 2017 to August 2018, she was the Controller at Ra Pharmaceuticals, Inc., a biopharmaceutical company. From July 2014 to February 2017, Ms. Cieplinska was the Senior Director, Technical Accounting and External Reporting at Charles River Laboratories, a corporation specializing in preclinical and clinical laboratory services and, from September 2012 to July 2014, she was the Director of Accounting Policy and External Reporting at Ironwood Pharmaceuticals, Inc., a pharmaceutical company. Ms. Cieplinska received her Master of Science from SGH Warsaw School of Economics in 2001 and her MBA and Graduate Diploma in Professional Accounting from Suffolk University in 2003.
Anthony Manning, Ph.D. has been our Chief Scientific Officer since October 2018. He is responsible for research and driving the discovery of novel products. From January 2013 to October 2018, Dr. Manning served as our Senior Vice President, Research. Prior to joining Momenta, Dr. Manning was Vice President and Head of Immunology Research for Biogen, Inc., a multinational biotechnology company. Before that, he was Vice President and Global Head of Inflammation, Autoimmunity and Transplantation Research at Roche Pharmaceuticals. Dr. Manning is currently a member of the board of directors of Palatin Technologies, and is the Chairman of the non‑profit Institute for Biomedical Entrepreneurship. Dr. Manning holds a Ph.D. from the University of Otago, New Zealand.
Santiago Arroyo, M.D., Ph.D. has been our Chief Medical Officer since October 2018. Dr. Arroyo is responsible for preclinical and clinical development and regulatory affairs. Prior to his appointment as Chief Medical Officer, he served as our Senior Vice President, Development and Chief Medical Officer from June 2017 to October 2018. Prior to joining Momenta, Dr. Arroyo was Chief Medical Officer of Boston Pharmaceuticals Inc. from October 2015 to May 2017. Prior to that, from 2010 to 2015, he was Senior Vice President, Head of Clinical Research and Chief Medical Officer of Biotherapeutics and

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Pharmatherapeutics at Pfizer Inc., a pharmaceutical company, in the areas of cardiovascular and metabolism, pain, neuroscience, regenerative medicine and rare diseases. From 2007 to 2010, Dr. Arroyo was Therapeutic Area Head for Neurosciences, Discovery Medicine and Clinical Pharmacology at Bristol‑Myers Squibb, a pharmaceutical company, and, from 2004 to 2007, Neurology Global Therapeutic Area Head for Eisai Global Clinical Development, a division of Eisai Co. Ltd., a pharmaceutical company. Dr. Arroyo was an Instructor in Neurology at the Johns Hopkins Hospital in 1994 and Associate Professor of Neurology and Director of the Epilepsy Program at the Medical College of Wisconsin and Senior Specialist at the Hospital Clinic of Barcelona, Spain from 1994 to 2003. Dr. Arroyo received his M.D. from the Autonomous University of Madrid and his Ph.D. from the University of Barcelona, Spain.
Alejandra V. Carvajal has served as our Chief Legal Officer and General Counsel since October 2018. Ms. Carvajal is responsible for all legal matters and operations at the Company. From June 2017 to October 2018, Ms. Carvajal served as our Vice President, Deputy General Counsel. Prior to joining Momenta, Ms. Carvajal was Vice President and General Counsel of Cerulean Pharma Inc., a public biotechnology company, from September 2014 to June 2017. Prior to Cerulean, Ms. Carvajal worked at Millennium: The Takeda Oncology Company from 2004 to 2014, where she held a variety of legal positions of increasing seniority. Ms. Carvajal began her legal career in private practice with the law firms of Day, Berry & Howard and Hill & Barlow. Ms. Carvajal received a B.A. cum laude from Harvard University and a J.D. cum laude from The Georgetown University Law Center.
Ian D. Fier has been our Chief Manufacturing and Program Officer since October 2018. Mr. Fier is responsible for overseeing our process development and quality functions, manufacturing, and program management. From October 2002 to October 2018, Mr. Fier served as our Senior Vice President, Program Alliance and Leadership. Prior to joining Momenta, he was Vice President of Clinical Affairs at BioTransplant Inc., a company that develops pharmaceuticals and organ‑transplantation systems. Prior to that, he held positions in product development and project management at Hoechst‑Roussel (now Sanofi Aventis), Astra USA and The Medicines Company. Mr. Fier received his B.S. from Tufts University and a M.B.A. in Heath Care Management from Boston University.
Jo‑Ann Beltramello has served as our Chief Human Resources and Infrastructure Officer since October 2018. Ms. Beltramello is responsible for all human resources, IT, and site services for the Company. From October 2007 to 2018, Ms. Beltramello served as our Senior Vice President, Human Resources. Prior to joining Momenta, she was the Chief Human Resources Officer at Multiplan, a provider of health care cost management solutions. Prior to Multiplan, she held senior human resources roles at Private Healthcare Systems, Inc., Oxford Global Resources, Inc., and Randstad North America. Ms. Beltramello received her B.S. from Bentley University.


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EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
The following discussion provides information regarding compensation earned during 2019 by the following executive officers, who are listed below along with their positions as of December 31, 2019:
Craig A. Wheeler, our President and Chief Executive Officer,
Michelle Robertson, our Chief Financial Officer,
Santiago Arroyo, M.D., Ph.D., our Senior Vice President, Development and Chief Medical Officer,
Young Kwon, Ph.D., our Chief Business Officer, and
Anthony Manning, Ph.D., our Chief Scientific Officer.
We refer to these executive officers as our “Named Executives.” In October 2018, we implemented a restructuring (the "Restructuring"), pursuant to which we reduced the Company’s headcount in order to align our workforce with the Company’s new strategy to focus on the discovery and development of novel therapeutics for the treatment of rare immune mediated diseases and to advance our late stage biosimilar products. In addition, effective January 8, 2020, Ms. Robertson resigned as the Company’s Chief Financial Officer, at which time Dr. Kwon, previously our Chief Business Officer, was appointed our Chief Financial and Business Officer.
Executive Summary
The objectives of our executive compensation program are to align the interests of management with the interests of stockholders. We correlate compensation to Company and individual performance and design our programs to attract, retain and motivate talented employees. We reward both short‑ and long‑term company and individual performance, with the goal of increasing stockholder value over the long term. In determining executive compensation for 2019, we considered the results of the most recent advisory, non‑binding vote of stockholders on the compensation of the Named Executives, which was approved by 97% of the votes cast at the 2019 annual meeting of stockholders. We also reach out to stockholders from time to time to discuss important issues, including our compensation program, to inform our practices and confirm that they are aligned with our stockholders’ interests.
In 2019, the compensation committee updated:
our peer group for executive compensation and performance reference purposes to ensure the group is comprised of appropriately representative companies given the strategic changes in our business resulting from the Restructuring; and
given the stabilization of our business after the Restructuring, our equity grant incentive policies to normalize our grant practices, which had been altered in connection with our Restructuring, and to more align them to our new strategic business.
Our compensation committee reviews competitive market data provided by Radford, the committee’s independent compensation consultant, in making compensation decisions. The compensation committee generally targets base salary, annual incentive cash bonus opportunities and equity based awards for our Named Executives at the 50th percentile of our peer group on an aggregate basis; however, the compensation committee retains discretion to allow for individual adjustments based on factors and considerations specific to the individual, including but not limited to, the Named Executive’s performance during the year, leadership qualities, business responsibilities, role within the Company, industry experience, career and tenure with the Company, knowledge, qualifications, overall impact on the organization, current compensation arrangements, and long‑term potential to enhance stockholder value. We more heavily weigh equity-based awards than other forms of compensation because we believe equity-based awards are a powerful tool for encouraging performance and aligning the interests of our executives with those of our stockholders.
Our key compensation decisions for 2019 included the following:

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In February 2019, the compensation committee determined to maintain base salaries of our Named Executives, as the salary for each Named Executive other than Mr. Wheeler had been increased in October 2018 in connection with the Restructuring.
In February 2019, the compensation committee determined to award only stock options to our Named Executives given the awards of time-based restricted stock units granted to such executives, except for Mr. Wheeler, in October 2018 in connection with the Restructuring.
In January 2020, the compensation committee determined bonuses under our annual bonus program for our executives, including eligible Named Executives, to be at a 105% of corporate goal achievement level. Based on this corporate performance and the individual performances for eligible Named Executives in February 2020, the compensation committee approved an annual incentive cash bonus of 84% of base salary for our CEO, representing 105% of his target bonus for 2019, and annual incentive cash bonuses of 42% of base salary for our other eligible Named Executives, representing 105% of such Named Executives’ target bonuses for 2019.
Highlights of our compensation practices and policies include:
Stock ownership guidelines designed to foster alignment between the board, management, and stockholders, by requiring all directors and executive officers to maintain a meaningful investment in our stock.
Use of periodic long‑term performance‑based stock grants that are tied to the achievement of important corporate value generating events and are generally earned over a multi‑year period, to supplement annual time‑based equity grants and incent key business and strategic objectives.
Double‑trigger executive severance protection, whereby cash severance and equity acceleration occurs only in the context of a qualifying termination of employment, not merely upon a change of control of the Company.
Explicit prohibition of hedging the economic risk of ownership of our equity securities by our executive officers and directors.
Overview of Compensation Program and Philosophy
Our “pay‑for‑performance” philosophy forms the foundation for the compensation committee’s decisions regarding executive compensation. We use a combination of fixed and variable compensation programs to reward and incentivize strong performance, and to align the interests of our executives with our stockholders. This compensation philosophy, and the program structure approved by the compensation committee, is central to our ability to attract, retain and motivate individuals who can achieve the results that our stockholders expect.
Our compensation committee has determined that our compensation program should be designed to:
link pay to performance, measured on the corporate and individual level;
reinforce and reflect our business strategy and values;
reward teamwork and integrity;
motivate our employees to achieve meaningful results in support of our Company goals;
keep things simple to promote understanding and enable employees to make informed decisions; and
retain our management team and our other employees.
Our executive compensation philosophy is based on the following principles:
Competitive and Fair Compensation. We believe that the performance of our Named Executives should be viewed, and their overall compensation should be determined, in the context of our industry, our competitive landscape and our corporate performance. While we do not have an exact formula for allocating between cash and non‑cash compensation, we try to balance short‑term cash compensation and long‑term equity compensation

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by offering competitive base salaries, market‑competitive benefits and perquisites, annual incentive cash bonus awards and opportunities for financial growth through our equity incentive programs.
Sustained Performance. In determining total compensation, we stress a philosophy that is performance driven. Our Named Executives are rewarded primarily based upon an assessment of corporate performance and secondarily on individual performance. Corporate performance is evaluated by reviewing the extent to which established corporate goals are met and individual performance is evaluated by reviewing each Named Executive’s contributions in the context of the overall corporate goals. Considerations taken into account in evaluating individual performance include, but are not limited to, an individual’s demonstration of leadership, teamwork and operational success in his or her functional area, as well as across the Company. Our compensation philosophy emphasizing performance permeates total compensation for both executives and non‑executives. We believe that the design of our executive compensation program affects all of our employees and, because the performance of every employee is important to our success, we are cognizant of the effect that executive compensation may have on other employees.
Compensation for employees at all levels, including for our Named Executives, includes base salary, annual incentive cash bonuses, annual equity awards and other benefits. Certain employees, including our Named Executives, are also entitled to specified benefits in connection with a termination of employment or change of control.
Realizable Pay Aligned with Stockholder Value
The Company’s stock price has been and may continue to be extremely volatile. This volatility is due in part to regulatory, legal and other events and factors whose impact on our business is often unrelated or disproportionately related to our operating performance. The current value of outstanding equity awards can fluctuate considerably over time, falling well above or below the target or reported value of the awards at the time of grant. To help ensure our total compensation program is aligned with performance, our compensation committee regularly reviews the “realizable value” of equity awards in the context of the overall compensation program and continuing performance of the Company.
We believe that the compensation of our Named Executives is appropriate and aligned with the interests of our stockholders. In recent years, we have granted stock options and performance and time-based restricted stock and restricted stock units. A substantial portion of total compensation for our Named Executives has been attributable to stock options, the realizable value of which depends upon an increase in our stock price (and thereby an increase in stockholder value) following the date of grant. We have also granted restricted stock and restricted stock units to our Named Executives subject to performance‑based vesting conditions tied to attaining goals that our compensation committee believes are key to creating value for our stockholders and restricted stock and restricted stock units subject to time‑based vesting conditions which encourages stock ownership by and retention of our Named Executives. In February 2019, our equity awards for Named Executives consisted solely of stock options, in recognition of the grants of time‑based restricted stock units in October 2018 in connection with our Restructuring. In February 2020, we returned to making annual grants of stock options and restricted stock units.
CEO Pay for Performance
A significant portion of Mr. Wheeler’s compensation is variable, performance‑based compensation that we consider to be “at risk” because it is dependent on the success of our Company. At‑risk compensation includes long‑term equity based awards, the value of which depends on sustained, long‑term increases in the price of our common stock, and annual incentive cash bonuses, which require attaining meaningful performance goals established by our board of directors with the intent of driving short‑term value creation for our stockholders. The following charts and tables highlight the alignment between Mr. Wheeler’s compensation and our Company’s performance.

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2019 Pay Mix*
ceopayforperformance.jpg
*
Percentages calculated from values reported in the 2019 Summary Compensation Table.
We believe that the design of our compensation program, heavily weighted towards performance‑based vehicles, provides a strong linkage between the level of actual pay delivered and our performance. As the table above demonstrates, 69% of Mr. Wheeler’s 2019 compensation was granted in the form of equity‑based awards which are tied to the future appreciation in value of our stock and 14% of Mr. Wheeler’s 2019 compensation was based on actual performance tied to the achievement of annual targets under our 2019 bonus program. This strong focus on aligning pay and performance is a foundation of our executive compensation philosophy.
The following chart illustrates the alignment over the past five years of Mr. Wheeler’s total compensation (as reported in the Summary Compensation Table) and our total stockholder return (presented on an indexed basis, reflecting the value of $100 invested in our stock on December 31, 2014 as measured based on the closing price of our common stock on the final day of each indicated year).
ceopayvsstockholdertotalret.jpg

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2014
 
2015
 
2016
 
2017
 
2018
 
2019
CEO Pay ($000s)

$3,921

 

$5,345

 

$4,161

 

$4,785

 

$4,610

 

$4,588

Indexed TSR 12/31
$100.00
 
$123.26
 
$125.00
 
$115.86
 
$91.69
 
$163.87
We have also examined Mr. Wheeler’s realizable pay and our Company’s performance relative to our selected peer group, which is described below under the heading “-Use of Competitive Market Compensation Data”. We have ranked Mr. Wheeler’s three‑year total realizable pay for 2017‑19 relative to his counterparts in our peer group and compared the result to our rank in total stockholder return versus the stockholder return of our peers over the same period. Realizable pay includes cumulative salary and bonus paid for the past three years, plus the value of stock options, performance‑based restricted stock and stock units, time‑based restricted stock and restricted stock units granted during the same period, valued based on the Company’s stock price on December 31, 2019. The following chart illustrates that we fall squarely within the “zone of alignment” that has been identified by certain corporate governance advocates as a key measure of pay for performance.
20172019 CEO Realizable Pay Rank versus 2019 Total Stockholder Return Rank
totalstockholderreturn201720.jpg
Stock Ownership Guidelines
We maintain a stock ownership and retention program for our executive officers and directors to ensure that each of our executive officers and directors has a long‑term equity stake in Momenta, to more closely align the interests of the executive officers and directors with those of our stockholders and to further promote our commitment to sound corporate governance.
Under the program’s guidelines:
our President and CEO is expected to hold shares of our common stock having an aggregate value equal to or greater than three times his or her annual base salary;
other executive officers are expected to hold shares of our common stock having an aggregate value equal to or greater than their annual base salary; and
non‑employee directors are expected to hold shares of our common stock having an aggregate value equal to or greater than three times their then current annual base retainer for general board membership, excluding committee retainers, per‑meeting or other similar fees.
Our executive officers and directors are expected to comply with these guidelines within five years of becoming subject to the guidelines. After such five-year period, such persons will be annually evaluated at a determination date for

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compliance with these guidelines and until the applicable minimum share requirement is achieved, each executive officer and director is required to retain all shares of restricted stock and shares of stock received pursuant to restricted stock units upon the lapse of vesting restrictions, net of shares surrendered or sold to pay applicable withholding taxes. In addition, in the event that the applicable minimum share requirement is not achieved as of each determination date, such executive officer or director may not exercise and sell any stock options (other than to sell or surrender shares for payment of any taxes related to stock option exercises), including without limitation any sales pursuant to a 10b5‑1 plan. Once an executive officer or director has met these guidelines, he or she must continue to satisfy the guidelines so long as he or she remains subject to the guidelines. Each executive officer's and director’s satisfaction of the minimum share requirement is measured on at least an annual basis. Shares that count toward satisfaction of the guidelines include:
shares of common stock owned outright by the executive officer or director or his or her spouse or minor children;
shares of common stock held in trust for the benefit of the executive officer or director or his or her spouse or minor children; and
restricted stock or restricted stock units for which applicable restrictions have lapsed.
The minimum share requirement may be waived, at the discretion of the compensation committee, if compliance would create severe hardship or would prevent an executive officer or director from complying with a court order. As of March 17, 2020, all but five executive officers and all but five directors met the ownership requirements under the program. The officers and directors who are not in compliance are within the five- year compliance period.
Determining Executive Compensation-Roles and Process
Utilizing the philosophy and background outlined above, our compensation committee determines the parameters of the executive compensation program, including appropriate target levels and performance measures, and administers our executive compensation program. This section discusses in greater detail the roles and process underlying the application of our executive compensation philosophy.
Role of the Compensation Committee
The compensation committee oversees all aspects of our director, officer and other executive compensation policies. Based on the recommendations of the CEO and our Chief Human Resources and Infrastructure Officer regarding each Named Executive’s compensation, except with respect to the CEO’s own compensation, the compensation committee determines the compensation of each of the Named Executives. The chairman of the board and the chair of the compensation committee evaluate the CEO’s performance, utilizing input from the board of directors and from selected executive officers, and make recommendations to the compensation committee, which then determines the CEO’s compensation. The compensation committee also directly engages the services of an independent compensation consultant to assist the committee in evaluating its compensation practices and levels, as described in more detail under the caption “-Role of External Advisors” below.
Role of CEO in Compensation Decisions
Our CEO, together with our executive team, contributes to the establishment of annual corporate and business goals against which our annual incentive awards are measured. These goals are presented to our compensation committee, which reviews and finalizes the goals and recommends them for approval by our board of directors. The CEO’s role in the compensation process continues with soliciting “360‑performance reviews” of our Named Executives, which are evaluations submitted by employees who interact with the Named Executives. Each Named Executive also completes a written self‑assessment which is submitted to the CEO. The CEO incorporates the feedback from the 360‑performance reviews, the self‑assessment and the CEO’s own evaluation into formal written evaluations of the Named Executives. Based on the results of this performance review, the CEO then works directly with our Chief Human Resources and Infrastructure Officer to provide comprehensive recommendations for salary changes, individual components of annual incentive cash bonus awards and equity awards for each of our Named Executives other than himself. These recommendations are presented to our compensation committee for review, modification and approval.
At the request of the compensation committee, our CEO attends all or portions of periodic meetings of the compensation committee, but does not attend portions of any meeting in which the compensation committee discusses the CEO’s compensation or performance.

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The compensation committee has delegated to our CEO the authority to make stock option grants under our 2013 Incentive Award Plan to newly‑hired employees below the senior director level based on a number of options within a range as set forth in a matrix previously approved by the board of directors. All other stock options and all grants of restricted stock and restricted stock units are granted by the compensation committee.
Role of External Advisors
To assist the compensation committee in discharging its responsibilities, the compensation committee directly engages its independent compensation consultant, Radford, to evaluate aspects of our compensation practices, provide advice and make recommendations in determining compensation practices and levels, including making recommendations for our board of directors and executive compensation programs. As part of this process, members of the compensation committee reviewed materials provided by Radford and had the opportunity to meet independently with Radford periodically throughout the year to discuss our executive and director compensation and to receive input and advice. The compensation committee has access to all written reports and studies provided by Radford to management. In early 2019 and early 2020, Radford analyzed the share reserve under our 2013 Incentive Award Plan and projected share usage and updated its reports on director compensation and on executive compensation philosophy, base salary, merit increases and allocation of equity stock grants. In addition, Radford also assisted us in identifying our median employee and determining the ratio of our median employee’s annual total compensation to the annual total compensation of our CEO as described in more detail below under “CEO Pay Ratio.” After review and consultation with Radford, the compensation committee has determined that Radford is independent and there is no conflict of interest resulting from retaining Radford currently or during the year ended December 31, 2019. In reaching these conclusions, the compensation committee considered the factors set forth in Exchange Act Rule 10C‑1 and Nasdaq listing standards.
Use of Competitive Market Compensation Data
We maintain a peer group for executive compensation and performance reference purposes. The compensation committee, in consultation with Radford, determines the peer group using benchmarks based on revenue, market capitalization, and number of employees, among other factors, and uses a multi‑year period perspective in determining the peer group.
After our Restructuring, the Company has focused on the discovery and development of novel therapeutics for the treatment of rare immune mediated diseases and to advance one late stage biosimilar product. We believe that our current business, which now consists of two product areas, novel therapeutic candidates and legacy products, which include complex generics and our remaining late stage biosimilar product candidate, is more complex than many companies of our size and impacts the quality and breadth of talent that we need to attract and retain. We often compete for talent with much larger companies that have greater resources.

In selecting our peer group companies for 2019 in March 2018, the compensation committee considered a recommendation provided by Radford, taking into account the anticipated restructuring. In making its recommendations, Radford first identified all publicly traded, U.S.-headquartered companies in the biotechnology/pharmaceutical industry at the Phase 2 development stage with multiple product candidates or a revenue stream. Based on projected company metrics for 2019, Radford next refined the pool to reflect companies with 40 to 330 employees, annual revenue between $15 million and $135 million and a market capitalization between $500 million to $2 billion. Radford next qualitatively evaluated and refined the pool to identify each company's business focus and corporate strategy, where publicly disclosed. Radford then selected companies that were similar to us, taking into consideration the business focus, financial profile and stage of development for each company. In addition, the compensation committee also considered our 2018 peer group and Radford's recommendations regarding inclusion of those companies, along with the guidelines used by certain proxy advisory firms in selecting peer companies for us. Based on its analysis and Radford’s recommendations, in March 2018 the compensation committee approved the following 2019 peer group companies:


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2019 Peer Group Companies
 
 
Adaptimmune Therapeutics plc
Iovance Biotherapeutics, Inc.
 
Akebia Therapeutics, Inc.
Jounce Therapeutics, Inc.
 
Arena Pharmaceuticals, Inc.
Mirati Therapeutics, Inc.
 
Audentes Therapeutics, Inc.
MyoKardia, Inc.
 
CytomX Therapeutics, Inc.
Prothena Corporation plc
 
Enanta Pharmaceuticals, Inc.
Reata Pharmaceuticals, Inc.
 
Epizyme, Inc.
Sangamo Therapeutics, Inc.
 
Five PrimeTherapeutics, Inc.
Wave Life Sciences, Inc
 
GlycoMimetics, Inc.
Xencor Inc.
 
ImmunoGen, Inc.
ZIOPHARM Oncology Inc.

As a result of the changes to our business due to the restructuring, the 2019 peer group only retained Arena Pharmaceuticals, Inc. and ImmunoGen, Inc from our 2018 peer group. The additional 18 companies were added to the peer group as they fell within the financial parameters described above.

In selecting our peer group companies for 2020, the compensation committee considered a recommendation provided by Radford, as well as our 2019 peer group, the peer group companies selected for us by certain proxy advisory firms and the guidelines used by those proxy advisory firms in selecting peer companies. In making its recommendation, Radford first identified all publicly traded, U.S.-headquartered companies in the biotechnology/pharmaceutical industry at the Phase 2 or 3 development stage. Based on projected company metrics for 2020, Radford next refined the pool to reflect companies with 50 to 450 employees and a market capitalization between $350 million to $3.2 billion. Radford next qualitatively evaluated and refined the pool to identify each company's business focus and corporate strategy, where publicly disclosed. Radford then selected companies that were similar to us, taking into consideration the business focus, financial profile and stage of development for each company. Based on its analysis and Radford’s recommendations, in September 2019 the compensation committee approved the following 2020 peer group companies:

 
2020 Peer Group Companies
 
 
Akebia Therapeutics, Inc.
Iovance Biotherapeutics, Inc.
 
AnaptysBio, Inc.
MacroGenics, Inc.
 
Apellis Parmaceuticals, Inc.
Mirati Therapeutics, Inc.
 
Arena Pharmaceuticals, Inc.
MyoKardia, Inc.
 
Audentes Therapeutics, Inc.
Ra Pharmaceuticals, Inc.
 
CytomX Therapeutics, Inc.
Reata Pharmaceuticals, Inc.
 
Dicerna Pharmaceuticals, Inc.
Sangamo Therapeutics, Inc.
 
Enanta Pharmaceuticals, Inc.
Wave Life Sciences, Inc
 
Epizyme, Inc.
Xencor Inc.
 
GlycoMimetics, Inc.
ZIOPHARM Oncology, Inc.
The 2020 peer group included certain changes from the 2019 peer group as follows: the removal of Adaptimmune Therapeutics plc, Five Prime Therapeutics, Inc., Immunogen, Inc., Jounce Therapeutics, Inc. and Prothena Corporation plc and the addition of AnaptysBio, Inc., Appellis Pharmaceuticals, Inc., Dicerna Pharmaceuticals, Inc., MacroGenics, Inc. and Ra Pharmaceuticals, Inc.
In addition to using a peer group for executive compensation and performance reference purposes, we also utilize survey data, which has the advantage of including data on executive positions beyond what is available in public filings. In the fall of 2018, we obtained survey data from the Radford survey of the life sciences industry in Massachusetts and nationally. These surveys were utilized in determining the appropriate target level for Company‑wide salary increases for 2019 to assure that our proposed merit salary increases were competitive in the market and the survey data was considered by the compensation committee in determining not to increase our Named Executives’ base salaries in 2019. With respect to the survey data presented to the compensation committee, the identities of the individual companies included in the survey were

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not provided to the compensation committee, and the compensation committee did not refer to individual compensation information for such companies.
We believe that the use of both publicly available peer group data and survey data provides us a comprehensive set of compensation data from which we are able to make informed compensation decisions and remain competitive with the market in which we compete for executive talent. While the compensation committee generally targets the 50th percentile of our peer group when determining compensation for our Named Executives, the compensation committee does not establish compensation levels based directly on benchmarking. The compensation committee instead relies on the judgment of its members in making compensation decisions regarding base salaries, target bonus levels and long‑term equity incentive awards after reviewing our performance and carefully evaluating each Named Executive’s performance during the year, leadership qualities, business responsibilities, role within the Company, industry experience, career and tenure with the Company, knowledge, qualifications, overall impact on the organization, current compensation arrangements, and long‑term potential to enhance stockholder value. The compensation committee does not guarantee that any executive will receive a specific market‑derived compensation level.
Elements of Compensation
Our compensation program is designed to reward each Named Executive based upon achievement of a combination of corporate and individual performance objectives. Corporate performance is evaluated by reviewing the extent to which pre‑set goals are met, which generally include the achievement of specified operational and financial goals; specific research, clinical, regulatory, commercial or compliance milestones; and business development and financing initiatives. We evaluate individual performance in part by reviewing the extent to which individual performance facilitated the achievement of our corporate and business goals.
The compensation package offered to each Named Executive is comprised of a combination of:
base salary;
annual incentive cash bonus awards;
annual equity awards;
other benefits, such as health, dental, disability and life insurance; and
severance and change of control agreements.
In addition, the compensation committee determines the mix of compensation elements, such as base salary, annual incentive cash bonuses and equity awards, on an individual basis. The compensation committee allocates total compensation between cash and equity compensation based on a number of objective and subjective factors, including the role and responsibilities of the individual executive, and the nature of the behaviors the incentives are intended to motivate. The compensation committee’s philosophy is to balance compensation between long‑term and short‑term compensation, cash and non‑cash compensation, and to take into the account the roles and responsibilities of the individual officer.
Base Salary
Base salaries for our Named Executives are set at levels intended to reflect the scope of each Named Executive’s leadership qualities, business responsibilities, role within the Company, industry experience, career and tenure with the Company, knowledge, qualifications, overall impact on the organization, current compensation arrangements, and long‑term potential to enhance stockholder value. In setting base salaries our compensation committee reviews salary levels in effect for comparable positions within our peer group companies and also survey data of comparable positions within our industry. We believe that base salaries are a fundamental element of our executive compensation program because they provide a stable source of income for our Named Executives at a competitive level. Base salaries are reviewed at least annually by our compensation committee and are adjusted from time to time to ensure that our executive compensation structure remains aligned with our compensation objectives and to reward individual performance when warranted. The compensation committee generally targets base salaries for our Named Executives at the 50th percentile of our peer group.
2019 Base Salary. In February 2019, the compensation committee reviewed the salaries of the Named Executives and determined to maintain the base salaries of our Named Executives at their then-current levels, as such salaries had been increased for such officers, except for Mr. Wheeler, in October 2018 in connection with the Restructuring. The increases in

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October 2018 were determined following consideration of expanded responsibilities of certain Named Executives, promotions of certain Named Executives and the compensation committee’s review of industry trends in base salary increases as discussed in “Use of Competitive Market Compensation Data”. The following table sets forth the 2018 base salaries approved by the compensation committee effective October 5, 2018 and the 2019 base salaries approved by the compensation committee in February 2019:
Name
 
2018
Base Salary ($)
 
2019
Base Salary ($)
 
Increase (%)
Craig A. Wheeler
 
750,000

 
750,000

 
Michelle Robertson
 
350,000

 
350,000

 
Santiago Arroyo
 
450,000

 
450,000

 
Young Kwon
 
440,000

 
440,000

 
Anthony Manning
 
380,000

 
380,000

 
2020 Base Salary. The compensation committee reviewed the salaries of the Named Executives at its February 2020 meeting and approved base salary increases of approximately 4% for Mr. Wheeler and Dr. Arroyo, consistent with a 4.0% target merit increase for all employees approved following its review of survey data of industry trends provided by Radford. The compensation committee approved a higher increase for Dr. Kwon to reflect his appointment as Chief Financial Officer in January 2020 and a higher increase for Dr. Manning to align his base salary with the median of survey salary data for Chief Scientific Officers. The compensation committee also considered market survey data of industry trends as well as individual performance reviews for each of the Named Executives in approving such salary increases. The 2020 base salaries of our Named Executives effective January 1, 2020 are as set forth below:
Name
 
2019
Base Salary ($)
 
2020
Base Salary ($)
 
Increase (%)
Craig A. Wheeler
 
750,000

 
780,000

 
4.0
Michelle Robertson
 
350,000

 

(1)
N/A
Santiago Arroyo
 
450,000

 
470,000

 
4.4
Young Kwon
 
440,000

 
485,000

 
10.2
Anthony Manning
 
380,000

 
420,000

 
10.5

(1)    Effective January 8, 2020, Ms. Robertson resigned as the Company’s Chief Financial Officer.

Annual Incentive Cash Bonus
We use annual incentive cash bonuses to motivate and reward our Named Executives to achieve and exceed specified goals on an annual basis. Annual incentive cash bonuses are determined based on our achievement of corporate performance targets and individual contribution toward those corporate goals. Our corporate goals are typically focused upon the achievement of specific research, clinical, regulatory, commercial, financial, compliance or operational milestones. We consider these goals to be difficult to attain, conducive to the creation of stockholder value and designed to contribute to our current and future financial success. The goals we believe will have the greatest impact on stockholder value during the performance period receive the heaviest weighting.
Under our annual incentive cash bonus program, corporate goals are proposed by management, then reviewed and adopted by the compensation committee. Corporate goals are based on metrics or events that we believe will lead to increases in stockholder value over the one‑year performance period. Each corporate goal is assigned a percentage weighting and consists of three achievement milestones that correspond to achievement levels of 75%, 100% and 125%, respectively, of the goal. Achievement milestones for any corporate goal may represent different levels of achievement of the same condition or event, cumulative achievement of similar conditions or events, or may be independent conditions or events that are separately achievable. Our compensation committee retains discretion to set achievement levels for each corporate goal along a continuous range from 50% to 150% of the target level to more accurately reflect, where appropriate, extenuating or mitigating factors, extraordinary circumstances or other considerations relating to the achievement of one or more milestones for each goal or the resulting value of such achievement to stockholders and the Company.
The compensation committee approves an aggregate amount to fund all bonus payments to all employees, which we refer to as the annual bonus pool, based on our achievement of corporate goals. For example, if we were to achieve 70% for each of our corporate goals, the annual bonus pool would be equal to 70% of the aggregate target bonuses for all employees.

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The CEO’s annual incentive cash bonus award is determined based entirely upon the achievement of corporate goals. In the case of our other Named Executives, 75% of their annual incentive cash bonus awards is determined based upon the achievement of corporate goals and 25% upon the subjective analysis of their individual performance in relation to the corporate goals as determined by their performance review. The individual performance component of these bonuses is also adjusted by the percentage achievement of corporate goals. The individual performance reviews are presented to our compensation committee along with compensation recommendations. However, the compensation committee makes the final determination of each Named Executive’s individual achievement level subjectively, based on its own analysis of performance and not formulaically by reference to pre‑determined performance objectives.
Target bonuses for 2019 were 80% of base salary for our CEO, and 40% of base salary for our other Named Executives. Each Named Executive’s target bonus remained at the same level as in 2018. The CEO has a maximum bonus opportunity equal to 150% of his base salary, as required by his employment agreement. Our other Named Executives do not have specified maximum bonus opportunities. Bonuses, if any, are determined and paid on an annual basis after completion of the fiscal year in which bonuses are earned. The 2019 corporate goals and their respective weightings were:
advancing our novel drug programs based on achievements in enrollments in clinical trials (50%);
enhancing the value of biosimilar products based on manufacturing and partnership milestones (15%);
expanding our novel therapeutics programs based on identifying a new candidates for clinical trials and collaboration milestones (10%);
maximizing our complex generics products based on collaboration and revenue milestones (10%); and
achieving financial discipline goals (15%).
In assessing the achievement of these goals, the compensation committee considered the recommendations of our CEO, who, with input from other executive officers, reviewed the Company’s performance against the goals and made recommendations to the board of directors and the compensation committee. The compensation committee also considered assessments and guidance by the science committee relating to the achievement of technical and scientific goals. Given the importance to the Company's new strategic direction of and the success in advancing novel drug programs, the compensation committee used its discretion to increase the achievement level for that goal to 150%. In January 2020, the compensation committee met and determined achievement of the corporate goals was 105%, as set forth in the chart below. The achievement of corporate goals was determined as follows:
Corporate Goal
 
Percentage
Value (%)
 
Actual Level of
Achievement (%)
 
Percentage
Earned (%)
Advancing novel drug programs
 
50
%
 
150
%
 
75
%
Enhancing value of our biosimilars
 
15
%
 
33
%
 
5
%
Expanding novel therapeutics programs
 
10
%
 
75
%
 
7.5
%
Maximizing complex generic products
 
10
%
 
75
%
 
7.5
%
Financial discipline
 
15
%
 
67
%
 
10
%
Total
 
100
%
 
 
 
105
%
In February 2020, the compensation committee reviewed the performance recommendation for each of Dr. Arroyo, Dr. Manning and Dr. Kwon as submitted by the CEO and our Chief Human Resources and Infrastructure Officer. Individual performance was assessed at the Named Executives' contribution to the corporate goal achievement level of 105%.
Based on the assessment of overall achievement level and the subjective analysis of individual performance, we paid bonuses to our currently serving Named Executives for their performance in 2019 representing the following percentages of base salary and target bonus payment as of December 31, 2019:

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Name
 
Target Bonus
as a
Percentage of
Base Salary
(%)
 
Target Bonus
Payment
(at 100%)
($)
 
Corporate
Goal
Component
as a
Percentage of
Target Bonus
(%)
 
Individual
Performance
Component
as a
Percentage of
Target Bonus
(%)
 
Corporate
Goal
Achievement
Level
(%)
 
2019 Bonus
Payment
($)
 
2019 Bonus
Payment as a
Percentage of
Target Bonus
Payment
(at 100%)
(%)
Craig A. Wheeler
 
80

 
600,000

 
100

 

 
105

 
630,000

 
105

Michelle Robertson
 
40

 
140,000

 
75

 
25

 
105

 

 

Santiago Arroyo
 
40

 
180,000

 
75

 
25

 
105

 
189,000

 
105

Young Kwon
 
40

 
176,000

 
75

 
25

 
105

 
184,800

 
105

Anthony Manning
 
40

 
152,000

 
75

 
25

 
105

 
159,600

 
105


Ms. Robertson voluntarily resigned in January 2020, and was not eligible for an annual bonus.
Equity Awards
Compensation for employees, including our Named Executives, also includes equity awards designed to align the long‑term interests of our employees and our stockholders, to reward the achievement of individual performance goals and to assist in the retention of employees and executives. Prior to 2017, we historically provided annual grants of time‑based stock options and restricted stock to our Named Executives. Beginning in 2017, our compensation committee elected to replace our annual restricted stock awards with awards of restricted stock units. Each restricted stock unit represents the right to receive one share of our common stock or, at the administrator’s discretion, its cash value equivalent shortly following vesting. In February 2018, our equity awards for our CEO were in the standard format from prior years, with half of the grant value in restricted stock units subject to time-based vesting and the balance in stock options. Given the uncertainty resulting from the strategic review of our business initiated in January 2018, the equity awards in February 2018 to our Named Executives other than our CEO consisted solely of restricted stock units subject to time-based vesting conditions to encourage stock ownership and retention of such Named Executives. In October 2018, given the expanded responsibilities and business uncertainties resulting from our Restructuring, coupled with declining stock values, the compensation committee determined to grant additional time-based restricted stock units to our executives, including Named Executives, except for Mr. Wheeler, to enhance our ability to retain our critical executives. In February 2019, our compensation committee determined to award to our Named Executives only stock options given the award of time-based restricted stock units in October 2018. In February 2020, we returned to our historical practice of making annual grants comprised of time-based stock options and restricted stock units to our Named Executives.
We have historically maintained at least one outstanding long‑term performance based equity award for our executives and employees, vesting of which is subject to the achievement of conditions we expect will require several years to attain and will create significant value for our stockholders, such as receipt of approval for a specific product from governmental entities. Consequently, we make performance-based equity grants less frequently than time‑based equity grants. We most recently put in place a new performance-based equity plan for our employees and executives in October 2018 in connection with our Restructuring and all Named Executives, except for Mr. Wheeler, received grants of PSUs under the plan. At such time, the compensation committee determined to defer granting any performance based or time-based equity awards to our CEO, in part to determine how the retention of executives and a financing of the company after our Restructuring proceeded. In December 2018, after the successful completion of our equity financing and evidence of the stabilization of the executive team, the compensation committee determined to make an equity grant to our CEO limited to performance based restricted stock units to further align CEO equity awards with stockholder value.
The compensation committee does not use a quantitative formula to determine the size of annual equity awards for our Named Executives. The compensation committee intends that the annual aggregate value of awards (using the Black Scholes model in the case of options) to the Named Executives will be targeted at the 50th percentile of our peer group, with an opportunity to achieve above or below that amount based on performance.
Annual Equity Awards for 2019 Performance. At its meeting in February 2020, our compensation committee reviewed proposed equity awards for 2019 performance of our currently serving Named Executives and approved the following awards of stock options and restricted stock units, which vest as to 25% of the shares on the first anniversary of the date of grant and an additional 6.25% of the shares at the end of each successive three‑month period thereafter:

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Name
 
Shares of Common Stock
Underlying Stock Options
(#)
 
Restricted Stock Units
(#)
Craig A. Wheeler
 
200,000

 
100,000

Michelle Robertson
 

 

Santiago Arroyo
 
105,000

 
52,500

Young Kwon
 
100,000

 
50,000

Anthony Manning
 
90,000

 
45,000


Ms. Robertson voluntarily resigned in January 2020, and was not eligible for annual equity grants.
Annual Equity Awards for 2018 Performance. At its meeting in February 2019, our compensation committee reviewed proposed equity awards for 2018 performance of our currently serving Named Executives and approved the following awards of stock options, which vest as to 25% of the shares on the first anniversary of the date of grant and an additional 6.25% of the shares at the end of each successive three‑month period thereafter:
Name
 
Shares of Common Stock
Underlying Stock Options
(#)
Craig A. Wheeler
 
491,000

Michelle Robertson
 
97,000

Santiago Arroyo
 
130,000

Young Kwon
 
135,000

Anthony Manning
 
106,000


Timing and Pricing of Equity Grants. The annual equity grant date for all eligible employees, including the Named Executives, is the date of the regularly scheduled meeting of the compensation committee following completion of company‑wide performance reviews, which meeting date is generally set a year in advance. The grant date coincides with our calendar‑year‑based performance management cycle, allowing us to deliver the equity awards close in time to performance assessments, which increases the impact of the awards by strengthening the link between pay and performance.

Aside from the annual equity grant to employees, it has been our policy that equity awards be granted:
to non‑employee members of the board of directors, on the date of the scheduled board meeting coinciding with our annual stockholders’ meeting each calendar year; and
to newly‑hired employees on the date of the next scheduled meeting of the compensation committee occurring after their date of hire.
Initial stock option grants typically vest as to 25% of the shares subject to such option one year from the date of grant and 6.25% of the shares subject to such option on a quarterly basis thereafter. Our annual option and restricted stock unit awards currently vest as to 25% of the shares on the first anniversary of the date of grant and an additional 6.25% of the shares at the end of each successive three‑month period thereafter. Awards granted to our employees, directors or consultants after June 9, 2015 are generally subject to a minimum one year vesting requirement, subject to certain exceptions set forth in our 2013 Incentive Award Plan.
The compensation committee sets the exercise price of all employee stock options to equal the closing price of our common stock on The Nasdaq Global Select Market on the date of grant.
Other Elements of Compensation and Perquisites
We maintain broad‑based benefits that are provided to eligible employees, including health, dental, life and disability insurance and a 401(k) plan. Our Named Executives are eligible to participate in our employee benefit plans, on the same basis as other employees. In order to attract and retain our employees and provide benefits packages aligned with market levels, we provide our Named Executives and other employees the following benefits and perquisites:

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Medical Insurance. We provide to our Named Executives, their spouses, domestic partners and children, health, dental and vision insurance coverage that we generally make available to other employees. We pay a portion of the premiums for this insurance for all employees.
Life and Disability Insurance. We provide each Named Executive disability and/or life insurance that we may from time to time make available to other executive employees. Our CEO also receives reimbursement for an additional $3.0 million life and disability policy, capped at a maximum of $5,000 of reimbursement premium per year, as well as a tax gross up for such reimbursements.
Defined Contribution Plan. We offer a Section 401(k) Savings/Retirement Plan, or the 401(k) Plan, a tax‑qualified retirement plan, to eligible employees. The 401(k) Plan permits eligible employees to defer up to 60% of their annual eligible compensation, subject to certain limitations imposed by the Internal Revenue Code, or the Code. In any plan year, we contribute a matching contribution equal to 50% of the first 6% of a participant’s contributions. Our contribution is subject to vesting at the rate of 25% at the end of each year over the first four years of employment. All of our Named Executives participated in the 401(k) Plan in 2019.
Employee Stock Purchase Plan. We also offer an Employee Stock Purchase Plan, or the ESPP. The ESPP is available to all of our employees, including the Named Executives, who work more than 20 hours per week and five months per year. Under the ESPP, eligible participants purchase shares of our common stock at a discount of 15% from the fair market value of the lower of the beginning date or end date of the applicable purchase period. The purchase dates occur on the last business day of January and July of each year. To pay for the shares, each participant may authorize periodic payroll deductions ranging from 1% to 15% of his or her cash compensation, subject to certain limitations imposed by applicable law. All payroll deductions collected from the participant during a plan period are automatically applied to the purchase of common stock on that period’s purchase date provided the participant remains an eligible employee and has not withdrawn from the ESPP prior to that date.
Equity Award Retirement Policy. In December 2016 our board of directors adopted the Momenta Pharmaceuticals, Inc. Equity Award Retirement Policy, or the Retirement Policy, to provide for the treatment of time‑based stock options and restricted stock units upon a participant’s qualifying retirement from the Company. Under the Retirement Policy, following the qualifying retirement of any employee of the Company, including the Named Executives, or non‑employee member of the board of directors, the participant’s then‑outstanding time‑based options and restricted stock units will continue to vest during the one year period following the retirement date. In addition, the participant will have until the first anniversary of the retirement date (or 90 days following the date an option becomes first exercisable if such date is within the 90 days preceding the first anniversary of the retirement date) to exercise any vested options, except that no option may be exercised following the date upon which it would have expired under the applicable option award agreement if the participant had remained in service with us. Benefits under the Retirement Policy are conditioned upon a participant’s continued compliance with any non‑competition, non‑solicitation, confidentiality or other restrictive covenants with the Company.
Other. We make available certain other perquisites or fringe benefits to all eligible employees, including the Named Executives, such as tuition reimbursement, parking subsidies, mass transit commuting passes, professional society dues, gym subsidies, cell phones and food and recreational fees incidental to official company functions, including board meetings. The CEO is also entitled to financial and tax advice, up to a maximum of $5,000 annually, and reimbursement of expenses in connection with using his personal airplane for business purposes (up to the equivalent amount of a first class commercial fare per usage).
Severance and Change of Control Benefits
Pursuant to employment agreements, our Named Executives are entitled to specified benefits in the event of the termination of their employment under specified circumstances, including termination without cause or for good reason.
We believe that severance protections, particularly in the context of a change of control transaction, can play a valuable role in attracting and retaining executive officers, are an important part of an executive’s total compensation package and are consistent with competitive practices. We believe that the occurrence, or potential occurrence, of a change of control will create uncertainty regarding the continued employment of our Named Executives. This uncertainty results from the fact that many change of control transactions result in significant organizational changes, particularly at the senior executive level. Our practice, in the case of our employment agreements, has been to structure these change of control benefits as “double trigger” benefits. In other words, the change of control does not itself trigger benefits; rather, benefits are paid only if the employment of the Named Executive is terminated during the twelve‑month (or 24‑month in the case of the CEO) period after

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the change of control. We believe a “double trigger” benefit maximizes stockholder value because it prevents an unintended windfall to executives in the event of a friendly change of control, while still providing them appropriate incentives to cooperate in negotiating any change of control in which they believe they may lose their jobs. Because we believe that a termination by the executive for good reason is conceptually the same as a termination by us without cause, and that in the context of a change of control potential acquirers would otherwise have an incentive to constructively terminate the executive’s employment to avoid paying severance, we provide severance benefits in these circumstances. We have provided more detailed information about these benefits, along with estimates of their value under various circumstances, under the captions “-Employment, Severance and Change of Control Arrangements” and “-Potential Termination and Change of Control Payments” below.
Tax Considerations
Section 162(m) of the Code places a limit of $1,000,000 per person on the amount of compensation that a public company may deduct in any year with respect to certain current or former executive officers. Our compensation committee has not adopted a policy requiring all executive compensation to be fully deductible, but reviews the potential impact of Section 162(m) periodically and reserves the right to use its judgment to authorize compensation payments that may be subject to the Section 162(m) limitation when it believes these payments are appropriate.
Risk Assessment of Compensation Policies and Programs
We periodically assess our compensation policies and programs for purposes of determining the relationship of such policies and programs to our enterprise risks. This assessment typically occurs in connection with the establishment of corporate goals and annual incentive programs for our employees. We do not believe that our compensation policies or programs create risks that are reasonably likely to have a material adverse effect on us.
Compensation Committee Report
The compensation committee has reviewed and discussed the Compensation Discussion and Analysis with the Company’s management. Based on this review and discussion, the compensation committee recommended to our Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.
By the Compensation Committee of the Board of Directors of Momenta Pharmaceuticals, Inc.:
Steven C. Gilman (Chair)
Bruce L. Downey
Donna R. Grogan
Jose‑Carlos Gutiérrez‑Ramos


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Summary Compensation Table for 2019
The following table sets forth information regarding compensation earned by the Named Executives:
Name and Principal Position
 
Year
 
Salary
($)
 
Stock
Awards(1)
($)
 
Option
Awards(1)
($)
 
Non‑Equity
Incentive Plan
Compensation
($)
 
All Other
Compensation(2)
($)
 
Total
($)
Craig A. Wheeler
 
2019
 
750,000
 
 
3,178,390
 
630,000
 
30,073
 
4,588,463
President, Chief Executive Officer and Director
 
2018
 
750,000
 
1,609,625
 
1,590,566
 
630,000
 
30,079
 
4,610,270
 
2017
 
750,000
 
1,743,625
 
1,776,463
 
480,000
 
34,551
 
4,784,639
Michelle Robertson
 
2019
 
350,000
 
 
627,910
 
 
13,853
 
991,763
Chief Financial Officer
 
2018
 
301,395
 
747,662
 
 
147,000
 
13,516
 
1,209,573
Santiago Arroyo
 
2019
 
450,000
 
 
841,529
 
189,000
 
11,977
 
1,492,506
Senior Vice President, Development and Chief Medical Officer(3)
 
2018
 
442,346
 
1,660,600
 
 
189,000
 
13,480
 
2,305,426
 
2017
 
257,231
 
619,200
 
1,291,065
 
144,320
 
9,213
 
2,321,029
Young Kwon
 
2019
 
440,000
 
 
873,896
 
184,800
 
13,872
 
1,512,568
Chief Business Officer
 
2018
 
411,796
 
1,742,100
 
 
202,400
 
13,378
 
2,369,674
Anthony Manning
 
2019
 
380,000
 
 
686,170
 
159,600
 
14,220
 
1,239,990
Chief Scientific Officer
 
2018
 
357,842
 
1,660,600
 
 
152,000
 
13,709
 
2,184,151

(1)
Valuation based on the aggregate grant date fair value of option and restricted stock unit awards computed in accordance with the Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC Topic 718, Stock Compensation (excluding the effect of estimated forfeitures.) The aggregate grant date fair value of option and restricted stock unit awards does not correspond to the actual value that will be realized by the Named Executive upon vesting or exercise of such award. The assumptions used by us with respect to the valuation of option and restricted stock unit awards are set forth in Note 2 and Note 12 to our financial statements contained in our Annual Report on Form 10‑K for year ended December 31, 2019, as filed with the Securities and Exchange Commission on February 27, 2020.
(2)
The following table sets forth information regarding all other compensation for the year ended December 31, 2019:
Name
 
Tax
Advice
Expense
($)
 
Life and Disability Insurance
Premium Reimbursement
($)
 
Tax
Gross‑Up
for
Insurance
Premium Reimbursement
($)
 
401(k)
Match
($)
 
Parking/
Transit
($)
 
Gym
Fees
($)
 
Life and Disability Insurance
Premiums
($)
 
Total
($)
Craig A. Wheeler
 
5,000

 
5,000

 
3,459

 
8,400

 
6,714

 
348

 
1,152

 
30,073

Michelle Robertson
 

 

 

 
8,400

 
4,320

 

 
1,133

 
13,853

Santiago Arroyo
 

 

 

 
8,400

 
2,425

 

 
1,152

 
11,977

Young Kwon
 

 

 

 
8,400

 
4,320

 

 
1,152

 
13,872

Anthony Manning
 

 

 

 
8,400

 
4,320

 
348

 
1,152

 
14,220

2019 Grants of Plan-Based Awards
The following table sets forth information regarding awards made to our Named Executives during the year ended December 31, 2019:

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Estimated Future
Payouts Under
Non‑Equity
Incentive
Plan Awards(2)
 
 
 
 
 
 
Name
 
Type of
Award(1)
 
Grant
Date
 
Target
($)
 
Maximum
($)
 
All Other
Option
Awards:
Number of
Shares of
Stock (#)
 
Exercise
Price of
Option
Awards(4)
($/Sh)
 
Grant Date
Fair Value
of Stock
and
Option
Awards(5)
($)
Craig A. Wheeler
 
AIBP
 
 
 
600,000

 
1,125,000
 
 
 
 
 
 
 
 
SO
 
2/11/2019(3)
 
 
 
 
 
491,000

 
12.76

 
3,178,390

Michelle Robertson
 
AIBP
 
 
 
140,000

 

 
 
 
 
 
 
 
 
SO
 
2/11/2019(3)
 
 
 
 
 
97,000

 
12.76

 
627,910

Santiago Arroyo
 
AIBP
 
 
 
180,000

 

 
 
 
 
 
 
 
 
SO
 
2/11/2019(3)
 
 
 
 
 
130,000

 
12.76

 
841,529

Young Kwon
 
AIBP
 
 
 
176,000

 

 
 
 
 
 
 
 
 
SO
 
2/11/2019(3)
 
 
 
 
 
135,000

 
12.76

 
873,896

Anthony Manning
 
AIBP
 
 
 
152,000

 

 
 
 
 
 
 
 
 
SO
 
2/11/2019(3)
 
 
 
 
 
106,000

 
12.76

 
686,170


(1)
Type of Award:
AIBP = Annual Incentive Bonus Plan
SO = Stock Option
(2)
All awards in these columns were granted under our annual incentive cash bonus plan. The actual amounts awarded are reported in the “Non‑Equity Incentive Plan Compensation” column in the Summary Compensation Table above. See “Executive Compensation-Compensation Discussion and Analysis-Elements of Compensation-Annual Incentive Cash Bonus” for a description of this plan.
(3)
The shares of common stock underlying this option vest as to 25% of the shares on the one year anniversary of the grant date, and an additional 6.25% of the shares vest at the end of each successive three‑month period thereafter.
(4)
The exercise price of the applicable stock option is equal to the closing price of our common stock as reported by The Nasdaq Global Select Market on the date of grant.
(5)
Valuation is based on the aggregate grant date fair value of option awards computed in accordance with FASB ASC Topic 718. The aggregate grant date fair value of option awards does not correspond to the actual value that will be realized by the Named Executive upon vesting or exercise of such award. The assumptions used by us with respect to the valuation of option awards are set forth in Note 2 and Note 12 to our financial statements contained in our Annual Report on Form 10‑K for year ended December 31, 2019, as filed with the Securities and Exchange Commission on February 27, 2020.


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Outstanding Equity Awards at 2019 Year-End
The following table sets forth information regarding outstanding stock options and awards of restricted stock held by our Named Executives as of December 31, 2019:
 
 
Option Awards
 
Stock Awards
Name
 
Number
of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
 
Number
of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
 
Option
Exercise
Price
($)
 
Option
Expiration
Date
 
Number of
Shares or
Units of
Stock
That Have
Not
Vested
(#)
 
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested(1)
($)
 
Equity
Incentive Plan
Awards: Number
of Unearned
Shares, Units or
Other Rights That
Have Not Vested
(#)
 
Equity
Incentive Plan
Awards: Market or
Payout Value of
Unearned Shares, Units
or Other Rights That
Have Not Vested(1)
($)
Craig A. Wheeler
 
100,000

 

 
13.26

 
2/22/2021
 
3,938(2)
 
77,697

 
 
 
 
 
 
150,000

 

 
15.44

 
2/14/2022
 
28,907(3)
 
570,335

 
 
 
 
 
 
150,000

 

 
12.58

 
2/19/2023
 
55,547(4)
 
1,095,942

 
 
 
 
 
 
140,000

 

 
17.96

 
2/18/2024
 
 
 
 
 
334,000(6)
 
6,589,820

 
 
140,000

 

 
13.02

 
2/18/2025
 
 
 
 
 
 
 
 
 
 
118,125

 
7,875(7)

 
10.83

 
2/9/2026
 
 
 
 
 
 
 
 
 
 
127,187

 
57,813(8)

 
18.85

 
2/7/2027
 
 
 
 
 
 
 
 
 
 
86,406

 
111,094(9)

 
16.30

 
2/12/2028
 
 
 
 
 
 
 
 
 
 

 
491,000(10)

 
12.76

 
2/11/2029
 
 
 
 
 
 
 
 
Michelle Robertson
 
18,750

 
11,250(8)

 
15.50

 
5/11/2027
 
4,870(4)
 
96,085

 
 
 
 
 
 

 
97,000(10)

 
12.76

 
2/11/2029
 
29,250(5)
 
577,103

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60,000(6)
 
1,183,800

Santiago Arroyo
 
93,750

 
56,250(8)

 
17.20

 
6/20/2027
 
25,000(4)
 
493,250

 
 
 
 
 
 

 
130,000(10)

 
12.76

 
2/11/2029
 
42,000(5)
 
828,660

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
60,000(6)
 
1,183,800

Young Kwon
 
8,502

 

 
13.26

 
2/22/2021
 
1,182(2)
 
23,321

 
 
 
 
 
 
10,800

 

 
12.58

 
2/19/2023
 
7,047(3)
 
139,037

 
 
 
 
 
 
4,822

 

 
17.96

 
2/18/2024
 
27,500(4)
 
542,575

 
 
 
 
 
 
19,725

 

 
13.02

 
2/18/2025
 
42,000(5)
 
828,660

 
 
 
 
 
 
10,000

 

 
21.56

 
8/11/2025
 
 
 
 
 
60,000(6)
 
1,183,800

 
 
35,437

 
2,363(7)

 
10.83

 
2/9/2026
 
 
 
 
 
 
 
 
 
 
31,006

 
14,094(8)

 
18.85

 
2/7/2027
 
 
 
 
 
 
 
 
 
 

 
135,000(10)

 
12.76

 
2/11/2029
 
 
 
 
 
 
 
 
Anthony Manning
 
21,614

 

 
17.96

 
2/18/2024
 
375(2)
 
7,399

 
 
 
 
 
 
5,914

 

 
13.02

 
2/18/2025
 
3,750(3)
 
73,988

 
 
 
 
 
 
4,500

 
750(7)

 
10.83

 
2/9/2026
 
25,000(4)
 
493,250

 
 
 
 
 
 
16,500

 
7,500(8)

 
18.85

 
2/7/2027
 
42,000(5)
 
828,660

 
 
 
 
 
 

 
106,000(10)

 
12.76

 
2/11/2029
 
 
 
 
 
60,000(6)
 
1,183,800

(1)
Based on $19.73 per share, the last sale price of Momenta common stock on December 31, 2019.
(2)
These shares of common stock are subject to a restricted stock agreement dated February 9, 2016, pursuant to which 25% of such shares vested and became free from forfeiture on February 9, 2017, and an additional 6.25% of the shares vest and become free from forfeiture at the end of each successive three‑month period thereafter.
(3)
These shares of common stock are subject to a restricted stock unit agreement dated February 7, 2017, pursuant to which 25% of such units vested and became free from forfeiture on February 7, 2018, and an additional 6.25% of the units vest and become free from forfeiture at the end of each successive three‑month period thereafter.
(4)
These shares of common stock are subject to a restricted stock unit agreement dated February 12, 2018, pursuant to which 50% of such units vested and became free from forfeiture on February 12, 2019, and for Mr. Wheeler the remaining 50% will vest an additional 6.25% at the end of each successive 3 month period thereafter and for the

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US-DOCS\99082463.4



Named Executives other than Mr. Wheeler the remaining 50% of such units will vest and become free of forfeiture on February 12, 2020, and are subject to accelerated vesting in the event the Named Executive’s employment with us is terminated without “cause” or the Named Executive resigns for “good reason” (as such terms are defined in the Named Executive’s employment agreement).
(5)
These shares of common stock are subject to a restricted stock unit agreement dated October 17, 2018, pursuant to which 25% of such units vest and will became free from forfeiture on October 17, 2019, and an additional 6.25% of the units vest and become free from forfeiture at the end of each successive three‑month period thereafter.
(6)
Represents PSUs. The PSUs are eligible to vest in amounts up to 150% of the target number of PSUs based on the Company’s achievement of up to three clinical or regulatory milestones prior to October 17, 2022. The PSUs vest as to: (i) 25% of the target number of PSUs on the date the first milestone is achieved; (ii) 25% of the target number of PSUs on the first anniversary of the date the first milestone is achieved; (iii) 25% of the target number of PSUs on the date the second milestone is achieved; (iv) 25% of the target number of PSUs on the first anniversary of the date the second milestone is achieved; (v) 25% of the target number of PSUs on the date the third milestone is achieved; and (vi) 25% of the target number of PSUs on the first anniversary of the date the third milestone is achieved. In addition, the PSUs will accelerate with respect to 25% of the target number of PSUs as of the date of a transfer to a third party of the Company’s program, business line or business division principally responsible for the product that is subject to an applicable milestone (a "Program Transfer") and with respect to 25% of the target number of PSUs as of the first anniversary of the Program Transfer. The PSUs will also vest as to 150% of the target number of PSUs in the event of a termination without “cause” on or after October 17, 2019 and within 12 months following a change in control. On March 5, 2020 the first milestone under the PSUs was achieved.
(7)
The shares of common stock underlying these options vest as to 25% of the shares on February 9, 2016, and an additional 6.25% of the shares vest at the end of each successive three‑month period thereafter.
(8)
The shares of common stock underlying these options vested as to 25% of the shares on February 7, 2017 (May 11, 2017 as to Ms. Robertson, and June 20, 2017 as to Mr. Arroyo), and an additional 6.25% of the shares vest at the end of each successive three‑month period thereafter.
(9)
The shares of common stock underlying these options vested as to 25% of the shares on February 12, 2018, and an additional 6.25% of the shares vest at the end of each successive three‑month period thereafter.
(10)
The shares of common stock underlying these options vested as to 25% of the shares on February 11, 2019, and an additional 6.25% of the shares vest at the end of each successive three‑month period thereafter.




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2019 Option Exercises and Stock Vested
The following table sets forth information regarding options exercised by our Named Executives and shares of restricted stock that vested and became free from forfeiture during the fiscal year ended December 31, 2019.
 
 
Option Awards
 
Stock Awards
Name
 
Number of
Shares Acquired
on Exercise
(#)
 
Value Realized
on Exercise(1)
($)
 
Number of
Shares Acquired
on Vesting
(#)
 
Value Realized
on Vesting(2)
($)
Craig A. Wheeler
 
100,000

 
152,543

 
123,952

 
1,656,356

Michelle Robertson
 

 

 
16,983

 
231,806

Santiago Arroyo
 

 

 
48,000

 
638,490

Young Kwon
 
2,998

 
2,968

 
68,042

 
906,120

Anthony Manning
 
51,445

 
386,381

 
58,499

 
778,172


(1)
Value realized on exercise is based on the closing sale price of our common stock on the applicable date of exercise less the applicable option exercise price.
(2)
Value realized upon vesting is based on the closing sale price of our common stock on the applicable vesting date.
Employment, Severance and Change of Control Arrangements
Craig A. Wheeler Employment Agreement
On August 22, 2006, we entered into an employment agreement with Craig A. Wheeler, pursuant to which Mr. Wheeler serves as our President and CEO and as a member of the board of directors. In December 2010, Mr. Wheeler’s employment agreement was amended.
Salary, Bonus and Benefits
Pursuant to his employment agreement, Mr. Wheeler receives an annual base salary determined by the compensation committee, which is $780,000 for 2020. Mr. Wheeler is also eligible to receive bonuses of up to 150% of his base salary for the applicable fiscal year. Details of Mr. Wheeler’s 2019 cash bonus are described above under the caption “Elements of Compensation-Annual Incentive Cash Bonus.” Mr. Wheeler is also entitled to specified benefits, including: participation in our sponsored benefit programs; reimbursement for life and disability insurance premium expenses up to $5,000 per year and related tax gross‑up payments; and reimbursement of tax and financial advisor fees incurred by Mr. Wheeler, up to $5,000 per year, during the period of his employment.
Payments Upon Termination by Reason of Death or Disability, Termination Without Cause or Resignation for Good Reason
Under Mr. Wheeler’s employment agreement, Mr. Wheeler or Momenta may terminate Mr. Wheeler’s employment at any time. In the event Mr. Wheeler’s employment is terminated without cause by us, as the result of death or disability or Mr. Wheeler terminates his employment for good reason, other than in connection with a change of control, we have agreed to pay Mr. Wheeler a lump sum equal to:
12 months of Mr. Wheeler’s highest base salary in effect during the 12 months prior to the date of termination; and
an amount equal to the greater of 60% of such base salary or Mr. Wheeler’s last paid bonus.
Additionally, Mr. Wheeler and his dependents will continue to receive benefits under the Company’s medical and dental plans, or will receive comparable benefits, at subsidized rates to the same extent as active employees, for a maximum of 12 months following such termination subject to his re‑employment with comparable benefits. In addition, any time‑based equity awards that would have vested if Mr. Wheeler had remained employed for an additional 12 months and 25% of any unvested performance‑based equity awards will fully and immediately vest.

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Payments Upon Termination in Connection with a Change of Control
If Mr. Wheeler terminates his employment for good reason within 24 months following a change of control of Momenta, or if we terminate Mr. Wheeler’s employment without cause within 24 months following a change of control, we have agreed to pay Mr. Wheeler a lump‑sum cash payment equal to:
24 months of Mr. Wheeler’s highest base‑salary in effect during the 12 months prior to the date of termination;
an amount equal to the greater of 60% of two years of such base salary or two times the last bonus paid to Mr. Wheeler; and
if the aggregate purchase price paid in a change of control transaction equals or exceeds $1.1 billion, an additional amount equal to 12 months of base salary in effect at the time of Mr. Wheeler’s termination and the greater of 60% of one year of such base salary or the last bonus paid to Mr. Wheeler.
Additionally, Mr. Wheeler and his dependents will continue to receive benefits under the Company’s medical and dental plans, or will receive comparable benefits for 24 months (or a maximum of 36 months if the purchase price of the transaction equals or exceeds $1.1 billion) following such termination at subsidized rates to the same extent as active employees subject to his re‑employment with comparable benefits. In addition, Mr. Wheeler is entitled to reimbursement for excise taxes due under Section 4999 of the Code (as well as income and employment taxes due on the reimbursement payment) following a change of control and, if terminated as described above after a change of control, the unvested portions of all stock‑based awards shall fully and immediately vest.
NonCompetition, NonSolicitation, Confidential Information and Developments
Our employment agreement with Mr. Wheeler also contains non‑disclosure, non‑competition and assignment of intellectual property terms. These terms provide for the protection of our confidential information and the transfer of ownership rights to intellectual property developed by Mr. Wheeler to us and a 12‑month non‑compete provision.
Executive Employment Agreements with Michelle Robertson, Santiago Arroyo, Young Kwon and Anthony Manning
We have also entered into executive employment agreements, as amended, or the Executive Employment Agreements, with Michelle Robertson, Santiago Arroyo, Young Kwon and Anthony Manning. In June 2017, the Executive Employment Agreements with each of Drs. Arroyo, Kwon and Manning were amended to explicitly provide that the Named Executive’s rights thereunder to accelerated vesting of restricted stock in connection with certain employment terminations apply equally, as intended, to awards of restricted stock units. The Executive Employment Agreements with each of Ms. Robertson and Drs. Arroyo, Kwon and Manning provide for certain severance payments and benefits upon a qualifying termination, as described below, both during and outside of a change in control period.
Salary, Bonus and Benefits
Pursuant to the Executive Employment Agreements, we have agreed to pay Ms. Robertson and Drs. Arroyo, Kwon and Manning annual base salaries as determined by the compensation committee. If our board of directors approves an annual bonus, each of them will be eligible for a discretionary bonus award. The annual target for each executive’s bonus is currently 40% of the executive’s annualized base salary. The compensation committee will determine, in its sole discretion, whether (and in what amount) a bonus award is payable to each executive. In order to be eligible for any bonus hereunder, the executive must be an active employee of the Company on the date such bonus is paid.
Each executive is entitled to participate in all benefit plans and programs that we establish and make available to our employees to the extent that the executive is eligible under (and subject to the provisions of) the plan documents governing those programs.
Payments Upon Resignation by the Executive Without Good Reason or Termination by Us for Cause
The Executive Employment Agreements with each of Ms. Robertson and Drs. Arroyo, Kwon and Manning specify that if the executive voluntarily resigns his employment other than for good reason (as defined in each Executive Employment Agreement), or if we terminate the executive for cause (as defined in each Executive Employment Agreement), we will pay the executive all accrued and unpaid base salary through the executive’s date of termination and any vacation that is accrued but unused as of such date. The executive will not be eligible for any severance or separation payments or any continuation of

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benefits (other than those provided for under COBRA), or any other compensation pursuant to the Executive Employment Agreement or otherwise. The executive will also have such rights, if any, with respect to outstanding stock options and restricted stock grants as may be provided under each applicable award agreement.
Payments Upon Termination by Reason of Death or Disability, Termination Without Cause or Resignation for Good Reason
Pursuant to the Executive Employment Agreements with each of Ms. Robertson and Drs. Arroyo, Kwon and Manning, if the executive’s employment with us is terminated by us without cause, or by the executive’s voluntary resignation for good reason, other than in connection with a change of control (as defined in each Executive Employment Agreement), then the executive will be paid all accrued and unpaid base salary and any accrued but unused vacation through the date of termination. In addition, the executive will be eligible to receive the following separation benefits:
an amount equal to the sum of 12 months of the executive’s base salary as of the date of termination and the greater of (i) the annual discretionary target bonus established by our board of directors (or any other person or persons having authority with respect thereto) for the executive for the fiscal year in which the date of termination occurs or (ii) the annual bonus paid to the executive for the most recently completed fiscal year;
medical, dental and health benefits as in effect immediately prior to the termination date for a period of 12 months; and
continued vesting of any unvested stock options for a period of 12 months from the date of termination and an extension of the right to exercise any outstanding stock options through the earlier of three months after such 12‑month period or the original expiration date of the applicable stock option. The executive will also be entitled to immediate vesting, on the date of termination, of any restricted stock and restricted stock unit awards with underlying shares that vest solely through the passage of time (i.e., service‑based vesting) and not upon the achievement of specified conditions or milestones (i.e., performance‑based vesting), in each case that would have vested during the period of 12 months from the date of termination. The executive will also be entitled to such continued vesting and acceleration benefits in the event of his or her termination due to disability.
Pursuant to their employment agreements, Drs. Arroyo, Kwon and Manning are also eligible to receive the payments and benefits described above in the event of a termination due to death or disability, and on any qualifying termination, are also eligible to receive life insurance, accident and disability benefits as in effect immediately prior to the termination date for a period of 12 months.
Payments Upon Termination in Connection with a Change of Control
If the executive’s employment with the Company is terminated without cause or if the executive terminates his employment with good reason, in each case, (i) within one year following a change of control (as defined in each Executive Employment Agreement) or (ii) prior to a change in control where it is demonstrated that the termination occurred in connection with the change in control (which in the case of Ms. Robertson, must occur within 90 days prior to the change in control), the executive will be entitled to all accrued and unpaid base salary and any accrued but unused vacation through the date of termination. In addition, the executive will be eligible to receive the following separation benefits:
an amount equal to the sum of 12 months of the executive’s base salary as of the date of termination and the greater of (i) the annual discretionary target bonus established by our board of directors (or any other person or persons having authority with respect thereto) for the executive for the fiscal year in which the date of termination occurs or (ii) the annual bonus paid to the executive for the most recently completed fiscal year;
medical, dental and health benefits as in effect immediately prior to the termination date for a period of 12 months; and
immediate vesting of any unvested stock options, restricted stock, restricted stock units and any other outstanding equity‑based awards. All such equity awards will remain exercisable in accordance with the applicable stock option plan or grant agreement.
Pursuant to their employment agreements, in the event of a termination described above, Drs. Arroyo, Kwon and Manning are also eligible to receive life insurance, accident and disability benefits as in effect immediately prior to the termination date for a period of 12 months.

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Non‑Competition, Non‑Solicitation, Confidential Information and Developments
Each of the executives have entered into agreements providing for the protection of our confidential information, the transfer of ownership rights to intellectual property developed by each such executive to us and a 12‑month non‑compete provision.
February 2018 RSUs and 2018 PSUs
The restricted stock units granted to our Named Executives other than Mr. Wheeler in February 2018 (the “February 2018 RSUs”) and the PSUs granted in 2018 (the “2018 PSUs”) are subject to accelerated vesting in the event of certain terminations. The February 2018 RSUs vest in full in the event the Named Executive’s employment with us is terminated without “cause” or the Named Executive resigns for “good reason” (as such terms are defined in the Named Executive’s employment agreement). The Retirement Policy does not apply to the February 2018 RSUs. The 2018 PSUs will vest as to 150% of the target number of PSUs in the event the Named Executive is terminated without “cause” (as defined in the award agreement) on or after the first anniversary of the grant date and within 12 months following a change in control.
Potential Termination and Change of Control Payments
Potential Termination and Change of Control Payments for Craig A. Wheeler
The following table summarizes the potential payments, benefits and acceleration of vesting applicable to stock options, restricted stock and restricted stock unit awards under our employment agreement with Mr. Wheeler. The amounts shown below assume that the termination of Mr. Wheeler was effective as of December 31, 2019. Actual amounts payable to Mr. Wheeler upon his termination can only be determined definitively at the time of his actual departure.
Benefit
 
Voluntary
Termination or
Termination for
Cause
($)
 
Termination
Without
Cause, Termination
by Reason of
Death
or Disability,
or Resignation
for Good Reason
($)
 
Termination
Without
Cause
or Resignation
for Good
Reason Within
24 Months
of a Change
of Control
($)
Severance Benefits
 
 
 
 
 
 
Lump‑sum cash payment
 

 
1,380,000(2)

 
2,760,000(3)

Lump‑sum payment with respect to business combination
 

 

 
1,380,000(4)

Insurance/Healthcare benefits
 

 
32,652(5)

 
97,956(6)

Market Value of Stock Vesting on Termination(1)
 
 
 
4,445,866(7)

 
15,552,990(8)

Gross‑Up Payments
 

 

 
8,520,774(9)

Total
 

 
5,858,518

 
28,311,720


(1)
Based on the last sale price of our common stock on December 31, 2019, which was $19.73 per share.
(2)
Represents a lump sum payment equal to 12 months of the highest base salary in effect for Mr. Wheeler during the 12 months prior to his termination, or $750,000, plus an amount equal to his last paid bonus, or $630,000. This amount is to be paid in full six months and one day after the date of Mr. Wheeler’s termination.
(3)
Represents a lump sum payment equal to 24 months of the highest base salary in effect for Mr. Wheeler during the 12 months prior to his termination, or $1,500,000, plus an amount equal to two times Mr. Wheeler’s last paid bonus, or $1,260,000. This amount is to be paid in full six months and one day after the date of Mr. Wheeler’s termination.
(4)
Assumes that the change of control involves a business combination with an aggregate purchase price exceeding $1.1 billion. In such event, Mr. Wheeler is entitled to an additional lump sum payment equal to 12 months of the highest base salary in effect for Mr. Wheeler during the 12 months prior to his termination, or $750,000, plus an amount equal to his last paid bonus, or $630,000.

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(5)
Represents benefits payable over 12 months for continuation of coverage under medical and dental plans for Mr. Wheeler and his dependents subject to Mr. Wheeler’s re‑employment with comparable healthcare benefits. The value is based upon the type of insurance coverage we carried for Mr. Wheeler as of December 31, 2019 and is valued at the premiums in effect on December 31, 2019.
(6)
Assumes that the change of control involves a business combination with an aggregate purchase price exceeding $1.1 billion, and represents benefits payable over 36 months for continuation of coverage under medical and dental plans for Mr. Wheeler and his dependents subject to Mr. Wheeler’s re‑employment with comparable healthcare benefits. In the event the aggregate purchase price is less than $1.1 billion, Mr. Wheeler would be entitled to 24 months of continuation of coverage under medical and dental plans for Mr. Wheeler and his dependents subject to Mr. Wheeler’s re‑employment with comparable healthcare benefits, with a value equal to $65,304. This value is based upon the type of insurance coverage we carried for Mr. Wheeler as of December 31, 2019 and is valued at the premiums in effect on December 31, 2019.
(7)
Represents the acceleration of vesting of: 83,500 shares of common stock subject to a performance stock unit agreement between us and Mr. Wheeler dated December 21, 2018; 24,687 shares of common stock subject to a restricted stock unit agreement between us and Mr. Wheeler dated February 12, 2018; 23,125 shares of common stock subject to a restricted stock unit agreement between us and Mr. Wheeler dated February 7, 2017; 3,938 shares of common stock subject to a restricted stock agreement between us and Mr. Wheeler dated February 9, 2016; 214,812 shares of common stock underlying stock options granted to Mr. Wheeler dated February 11, 2019; 49,375 shares of common stock underlying stock options granted to Mr. Wheeler dated February 12, 2018; 46,250 shares of common stock underlying stock options granted to Mr. Wheeler dated February 7, 2017; and 7,875 shares of common stock underlying stock options granted to Mr. Wheeler dated February 9, 2016. See the discussion in this proxy statement under the heading “Employment, Severance and Change of Control Arrangements-Craig A. Wheeler Employment Agreement.”
(8)
Represents the acceleration of vesting of: 501,000 shares of common stock subject to a performance stock unit agreement between us and Mr. Wheeler dated December 21, 2018; 55,547 shares of common stock subject to a restricted stock unit agreement between us and Mr. Wheeler dated February 12, 2018; 28,907 shares of common stock subject to a restricted stock unit agreement between us and Mr. Wheeler dated February 7, 2017; 3,938 shares of common stock subject to a restricted stock agreement between us and Mr. Wheeler dated February 9, 2016; 491,000 shares of common stock underlying stock options granted to Mr. Wheeler dated February 11, 2019; 111,094 shares of common stock underlying stock options granted to Mr. Wheeler dated February 12, 2018; 57,813 shares of common stock underlying stock options granted to Mr. Wheeler dated February 7, 2017; and 7,875 shares of common stock underlying stock options granted to Mr. Wheeler dated February 9, 2016. See the discussion in this proxy statement under the heading “Employment, Severance and Change of Control Arrangements-Craig A. Wheeler Employment Agreement.”
(9)
Represents the gross‑up payable in respect of the excise tax under section 4999 of the Code.
In addition, if Mr. Wheeler had retired on December 31, 2019, the value of the benefits received under the Retirement Policy, calculated by multiplying the number of shares subject to the portion of Mr. Wheeler’s stock options and restricted stock units that would have vested during the 12 months following his retirement by (i) for stock options, the excess, if any, of the closing price of our common stock on December 31, 2019, which was $19.73, over the applicable per share option exercise price, or (ii) for restricted stock units, $19.73, would have been $2,720,714.

Potential Termination and Change of Control Payments for Ms. Robertson and Drs. Arroyo, Kwon and Manning
The following table summarizes the potential payments, benefits and acceleration of vesting applicable to stock options, restricted stock and restricted stock unit awards under our Executive Employment Agreements with each of Ms. Robertson and Drs. Arroyo, Kwon and Manning. The amounts shown below assume that the termination of each executive was effective as of December 31, 2019.
Actual amounts payable to each Named Executive listed below upon his or her termination can only be determined definitively at the time of each Named Executive’s actual departure.

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Name
 
Benefit
 
Voluntary
Termination or
Termination
for Cause
($)
 
Termination for
Death, Disability,
Without Cause or
for Good Reason
Other than in
Connection with
Change of Control
($) (1)
 
Termination
Without Cause or
Resignation for
Good Reason
Within
12 Months of a
Change of Control
($)
Michelle Robertson
 
Severance Benefits
 
 
 
 
 
 
 
 
Lump Sum Cash Severance
 

 
497,000(3)

 
497,000(3)

 
 
Insurance/Healthcare Benefits
 

 
28,608(4)

 
28,608(4)

 
 
Market Value of Stock Vesting on Termination(2)
 

 
615,963(5)

 
3,172,565(6)

 
 
Total
 
$

 
$
1,141,571

 
$
3,698,173

Santiago Arroyo
 
Severance Benefits
 
 
 
 
 
 
 
 
Lump Sum Cash Severance
 

 
639,000(3)

 
639,000(3)

 
 
Insurance/Healthcare Benefits
 

 
22,032(4)

 
22,032(4)

 
 
Market Value of Stock Vesting on Termination(2)
 

 
1,260,764(5)

 
4,146,023(6)

 
 
Total
 
$

 
$
1,921,796

 
$
4,807,055

Young Kwon
 
Severance Benefits
 
 
 
 
 
 
 
 
Lump Sum Cash Severance
 

 
642,400(3)

 
642,400(3)

 
 
Insurance/Healthcare Benefits
 

 
29,784(4)

 
29,784(4)

 
 
Market Value of Stock Vesting on Termination(2)
 

 
1,395,949(5)

 
4,283,677(6)

 
 
Total
 
$

 
$
2,068,133

 
$
4,955,861

Anthony Manning
 
Severance Benefits
 
 
 
 
 
 
 
 
Lump Sum Cash Severance
 

 
532,000(3)

 
532,000(3)

 
 
Insurance/Healthcare Benefits
 

 
22,032(4)

 
22,032(4)

 
 
Market Value of Stock Vesting on Termination(2)
 

 
1,171,248(5)

 
3,931,091(6)

 
 
Total
 
$

 
$
1,725,280

 
$
4,485,123


(1)
Ms. Robertson is eligible to receive: (a) cash severance and medical, dental and health benefits only upon a termination without Cause or resignation for Good Reason and (b) equity award acceleration benefits only upon a termination without Cause or due to disability or resignation for Good Reason.
(2)
Based on the last sale price of our common stock on December 31, 2019, which was $19.73 per share.
(3)
Represents 12 months of the Named Executive’s annual base salary. The amount shown also includes the Named Executive’s actual bonus paid for 2018. Such amounts are to be paid within 30 days after the Named Executive’s termination date. For more information relating to compensation earned by our Named Executives, see the section of this proxy statement entitled “Executive Compensation-Summary Compensation Table.”
(4)
Represents amounts payable over 12 months for continuation of coverage for insurance, medical, dental, health and accident and disability benefits for each Named Executive (other than Ms. Robertson) and his or her family members or 12 months of continuation coverage for medical, dental and health benefits for Ms. Robertson. The value is based upon the type of insurance coverage we carried for each Named Executive as of December 31, 2019 and is valued at the premiums in effect on December 31, 2019. For more information relating to compensation earned by our Named Executives, see the section of this proxy statement entitled “Executive Compensation-Summary Compensation Table.”
(5)
Represents continued vesting for an additional 12‑month period of all unvested stock options, full accelerated vesting for the February 2018 RSUs, and 12 months’ accelerated vesting of all other time‑based restricted stock and restricted stock unit awards held by the Named Executives as of December 31, 2019. For more information concerning option, restricted stock and restricted stock unit awards held by our Named Executives, see the section of this proxy statement entitled “Executive Compensation-Outstanding Equity Awards at 2019 Year End.”
(6)
Represents immediate vesting of all unvested equity awards held by the Named Executives as of December 31, 2019, with the 2018 PSUs vesting at 150% of target. For more information concerning equity awards held by our Named

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Executives, see the section of this proxy statement entitled “Executive Compensation-Outstanding Equity Awards at 2019 Year End.”
CEO Pay Ratio
As required by Section 953(b) of the Dodd‑Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of Regulation S‑K, we are providing the following information regarding the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Wheeler, our CEO.
During 2019, we engaged Radford to assist us in identifying our median employee and determining the ratio of our median employee’s annual total compensation to the annual total compensation of our CEO as required under Item 402(u) of Regulation S‑K. With the assistance of Radford, we identified the median employee from among those employees who were employed by us on December 31, 2019 (excluding our CEO) based on a consistently applied compensation measure comprised of annual base salaries as of that date, target bonus for 2019, and the grant date fair value of equity awards granted in 2019 determined in accordance with FASB ASC Topic 718 (excluding the effect of estimated forfeitures). We included all employees, whether employed on a full‑time, part‑time or seasonal basis, as of December 31, 2019, which yielded a total employee population of approximately 115 individuals, all of whom were located in the United States. We did not make any cost‑of‑living or other adjustments to employee compensation and did not annualize the compensation of any employees who were employed for less than the full year.
After identifying the median employee as described above, we calculated the 2019 annual total compensation for such employee using the same methodology we used for our Named Executives as set forth in the Summary Compensation Table for 2019.
For 2019, the combined annual total compensation for our CEO was $4,618,463, and for our median employee was $210,742, resulting in an estimated pay ratio of 22:1. The annual total compensation for our CEO in the pay ratio disclosure differs from the total compensation reflected in the Summary Compensation Table for 2019 because we included the value of company paid health and welfare benefits, estimated at $30,000.
We consider the pay ratio reported above to be a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S‑K based on our internal records and the methodology described above. The rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Therefore, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions.

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DIRECTOR COMPENSATION
Non‑employee director compensation is set by our board of directors at the recommendation of the compensation committee. Our 2019 compensation for non‑employee directors consisted of:
Grant of Stock Options Upon Appointment. Each non-employee director newly elected to the board of directors receives an equity grant equal to two times the most recent annual equity grant to non-employee directors upon appointment to the board. In 2019, we issued 50,000 stock options to each of the two directors who were newly elected to our board. These options vest as to 1/3 of the underlying shares on the first anniversary of the grant date and an additional 1/12 of such underlying shares at the end of each three month period thereafter, subject to such director's continued service to the Company.
Annual Grant of Options. Previously, non‑employee directors who served on our board of directors during the prior calendar year and who continue to serve on the board of directors were granted, on the date of the board meeting coinciding with the annual meeting of stockholders, an option to purchase shares of our common stock and restricted stock units. The number of shares subject to the option and the number of restricted stock units was determined annually by the board so that total value of the award targets the 50th percentile of the total value of equity grants made by our peer group companies to their respective directors. In 2019, as a result of the Restructuring and related changes to our peer group, the compensation committee approved a change in director annual equity grant policy to provide for a number of stock option only grants targeting a 50th percentile equal blend of value and percent of outstanding company shares made by our peer group companies to their respective individual directors. Accordingly, in 2019, we granted 25,000 options to each of our non‑employee directors on the date of our 2019 annual meeting. These options vest in full on the first anniversary of the grant date, subject to the non‑employee director’s continued service to the Company.
Payment of Retainer Fee; Reimbursement of Travel and Other Expenses. In addition to equity grants, each non‑employee director receives an annual retainer for his or her service on our board of directors as well as additional fees for committee service as follows:
 
 
Fees ($)
Annual Retainer
 
50,000
Non‑Employee Chairman of the Board
 
30,000
Audit Committee Chair
 
20,000
Audit Committee Members (other than the Chair)
 
12,500
Compensation Committee Chair
 
15,000
Compensation Committee Members (other than the Chair)
 
10,000
Nominating and Corporate Governance Committee Chair
 
12,000
Nominating and Corporate Governance Committee Members (other than the Chair)
 
7,000
Science Committee Chair
 
17,500
Science Committee Members
 
12,500
Science Committee, Chair and Members
 
3,000 for each all‑day session attended (up to a maximum of $15,000 per year), which is in addition to the standard quarterly meetings of the Science Committee
All retainer amounts are paid quarterly in arrears. Non‑employee directors also received reimbursement for reasonable travel and other expenses in connection with attending meetings of our board of directors.

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The following table sets forth the fees earned by each of our non‑employee directors for his or her service on the board of directors and the aggregate grant date fair value of option awards granted to our non‑employee directors for the year ended December 31, 2019:
2019 Director Compensation
Name
 
Fees Earned or
Paid in
Cash ($)(1)
 
Option
Awards ($)(2)
 
Total ($)
Jane F. Barlow (3)
 
3,966

 
398,480

 
402,446

Bruce L. Downey
 
102,500

 
158,660

 
261,160

Corey N. Fishman
 
77,000

 
158,660

 
235,660

Georges Gemayel
 
74,500

 
158,660

 
233,160

Steven C. Gilman
 
72,500

 
158,660

 
231,160

Donna R. Grogan (4)
 
18,125

 
340,080

 
358,205

Jose‑Carlos Gutiérrez‑Ramos
 
72,500

 
158,660

 
231,160

Thomas P. Koestler (5)
 
77,500

 
158,660

 
236,160

Elizabeth Stoner
 
74,500

 
158,660

 
233,160

James R. Sulat (6)
 
38,905

 
158,660

 
197,565

(1)
The fees earned by the non‑employee directors in 2019 consist of the following: (i) an annual retainer; (ii) a fee to the non‑employee chairman of the board; and (iii) an annual fee for chairing and being a member of each of the audit, compensation, nominating and corporate governance and science committees.
(2)
Valuation of these awards is based on the aggregate grant date fair value computed in accordance with FASB ASC Topic 718, Stock Compensation (excluding the effect of estimated forfeitures). These amounts do not correspond to the actual value that will be realized by the director upon vesting or exercise of such award. The assumptions used by us with respect to the valuation of restricted stock unit and option awards are set forth in Note 2 and Note 12 to our financial statements contained in our Annual Report on Form 10‑K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission on February 27, 2020. The following table shows the aggregate number of equity awards outstanding for each non‑employee director as of December 31, 2019:
Name
 
Aggregate Number of Shares
Subject to Outstanding
Stock Options(#)
Jane F. Barlow (3)
 
50,000

Bruce L. Downey
 
159,812

Corey N. Fishman
 
78,062

Georges Gemayel
 
75,062

Steven C. Gilman
 
78,062

Donna R. Grogan (4)
 
50,000

Jose‑Carlos Gutiérrez‑Ramos
 
75,062

Thomas P. Koestler (5)
 
157,062

Elizabeth Stoner
 
132,812

James Sulat (6)
 
152,812


(3)    Dr. Barlow was appointed as a member of the board of directors on December 11, 2019.

(4)    Dr. Grogan was appointed as a member of the board of directors on September 18, 2019.

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(5)    Mr. Koestler retired from the Board effective January 11, 2020.

(6)    Mr. Sulat retired from the board of directors effective July 22, 2019.


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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding beneficial ownership of our common stock as of April 17, 2020, by:
each person, or group of affiliated persons, known to us to be the beneficial owner of more than 5% of the outstanding shares of our common stock as of such date based on currently available Schedules 13D and 13G filed with the Securities and Exchange Commission;
each of our directors (which includes all nominees);
our Named Executives; and
all of our directors and executive officers as a group.
The number of shares of common stock beneficially owned by each person or entity is determined in accordance with the applicable rules of the Securities and Exchange Commission and includes voting or investment power with respect to shares of our common stock. The information is not necessarily indicative of beneficial ownership for any other purpose. Shares of our common stock issuable under stock options exercisable on or before June 16, 2020, are deemed beneficially owned for computing the percentage ownership of the person holding the options, but are not deemed outstanding for computing the percentage ownership of any other person. Unless otherwise indicated, to our knowledge, all persons named in the table have sole voting and investment power with respect to their shares of common stock, except to the extent authority is shared by spouses under community property laws. Unless otherwise indicated, the address of all directors and executive officers is c/o Momenta Pharmaceuticals, Inc., 301 Binney Street, Cambridge, Massachusetts 02142. The inclusion of any shares deemed beneficially owned in this table does not constitute an admission of beneficial ownership of those shares.


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Name and Address of Beneficial Owner
 
Total Number
of Shares
Beneficially Owned
 
Percentage of
Common Stock
Beneficially Owned(1)
Holders of more than 5% of our Common Stock
 
 
 
 
FMR LLC
245 Summer Street
Boston, MA 02210
 
17,357,503(2)

 
14.8
%
BlackRock, Inc.
55 East 52
nd Street
New York, NY 10055
 
17,283,738(3)

 
14.7
%
The Vanguard Group
100 Vanguard Blvd.
Malvern, PA 19355
 
11,919,788(4)

 
10.1
%
T. Rowe Price Associates, Inc.
100 E. Pratt Street
Baltimore, MD 21202
 
5,871,185(5)

 
5.0
%
Directors (including all nominees) and Named Executives
 
 
 
 
Jane Barlow
 

 
*

Bruce L. Downey
 
167,402(6)

 
*

Corey N. Fishman
 
63,152(7)

 
*

Georges Gemayel
 
64,152(8)

 
*

Steven C. Gilman
 
60,858(9)

 
*

Donna R. Grogan
 

 
*

Jose‑Carlos Gutiérrez‑Ramos
 
50,062(10)

 
*

Elizabeth Stoner
 
137,571(11)

 
*

Craig A. Wheeler
 
1,701,122(12)

 
1.4
%
Santiago Arroyo
 
174,470(13)

 
*

Young Kwon
 
314,225(14)

 
*

Anthony Manning
 
73,297(15)

 
*

Michelle Robertson
 

 
*

All current directors and executive officers as a group (16 persons)
 
3,070,413(16)

 
2.6
%

*
Less than 1% of our outstanding common stock.
(1)
Applicable percentage of ownership for each holder is based on 117,639,406 shares of common stock outstanding on April 17, 2020, plus any common stock equivalents and stock options held by each such holder that are presently exercisable or that will vest or become exercisable as of June 16, 2020.
(2)
Information is based on a Schedule 13G/A filed by FMR LLC, Abigail P. Johnson and Fidelity Growth Company Fund on February 7, 2020, and is as of December 31, 2019. According to the Schedule 13G/A, FMR LLC has sole voting power over 5,732,527 shares and sole dispositive power over all 17,357,503 shares, Abigail P. Johnson does not have voting power over any shares and has sole dispositive power over all 17,357,503 shares, and Fidelity Growth Company Fund has sole voting power over 7,019,453 shares and does not have dispositive power over any shares.
(3)
Information is based on a Schedule 13G/A filed by BlackRock, Inc. on February 4, 2020, and is as of December 31, 2019. According to the Schedule 13G/A, BlackRock, Inc. has sole voting power over 17,124,894 of such shares and sole dispositive power over all 17,283,738 shares.
(4)
Information is based on a Schedule 13G/A filed by The Vanguard Group on February 12, 2020, and is as of December 31, 2019. According to the Schedule 13G/A, The Vanguard Group has sole voting power with respect to 211,386 shares, sole dispositive power with respect to 11,708,101 shares, shared voting power with respect to 14,383 shares, and shared dispositive power with respect to 211,687 shares.

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(5)
Information is based on a Schedule 13G/A filed by T. Rowe Price Associates, Inc. on February 14, 2020, and is as of December 31, 2019. According to the Schedule 13G/A, T. Rowe Price Associates, Inc. has sole voting power with respect to 1,341,082 share and sole dispositive power with respect to all 5,871,185 shares.
(6)
Consists of 32,590 shares of common stock and 134,812 shares of common stock underlying options exercisable on or before June 16, 2020.
(7)
Consists of 10,090 shares of common stock and 53,062 shares of common stock underlying options exercisable on or before June 16, 2020.
(8)
Consists of 14,090 shares of common stock and 50,062 shares of common stock underlying options exercisable on or before June 16, 2020.
(9)
Consists of 7,796 shares of common stock and 53,062 shares of common stock underlying options exercisable on or before June 16, 2020.
(10)
Consists entirely of shares of common stock underlying options exercisable on or before June 16, 2020.
(11)
Consists of 35,509 shares of common stock and 102,062 shares of common stock underlying options exercisable on or before June 16, 2020.
(12)
Consists of 8,739 shares of common stock held directly and 559,586 shares of common stock held by trust, 1,120,843 shares of common stock underlying options exercisable on or before June 16, 2020 and 11,954 shares of common stock underlying restricted stock units vesting on or before June 16, 2020.
(13)
Consists of 30,720 shares of common stock and 143,750 shares of common stock underlying options exercisable on or before June 16, 2020.
(14)
Consists of 142,336 shares of common stock, 170,480 shares of common stock underlying options exercisable on or before June 16, 2020 and 1,409 shares of common stock underlying restricted stock units vesting on or before June 16, 2020.
(15)
Consists of 16,258 shares of common stock, 56,289 shares of common stock underlying options exercisable on or before June 16, 2020 and 750 shares of common stock underlying restricted stock units vesting on or before June 16, 2020.
(16)
Consists of an aggregate of 934,170 shares of common stock, 2,120,073 shares of common stock underlying options exercisable on or before June 16, 2020, and 16,170 shares of common stock underlying restricted stock units vesting on or before June 16, 2020.
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires our directors, certain officers, or Section 16 Officers, and the holders of more than 10% of our common stock to file with the Securities and Exchange Commission initial reports of ownership of our common stock and other equity securities on a Form 3 and reports of changes in such ownership on a Form 4 or Form 5. Based solely on our review of Section 16(a) reports filed with the Securities and Exchange Commission and representations made to us, we believe that during 2019, our Section 16 Officers, directors and holders of more than 10% of our common stock complied with all Section 16(a) filing requirements.


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EQUITY COMPENSATION PLAN INFORMATION
The following table provides information about the securities authorized for issuance under our equity compensation plans as of December 31, 2019:
Plan Category
 
Number of
securities
to be issued upon
exercise of
outstanding options
(a)(#)
 
Weighted‑average
exercise price of
outstanding options
(b)($)
 
Number of securities
remaining available
for future issuance under
equity compensation
plans (excluding
securities reflected
in column(a))
(c)(#)
 
Equity compensation plans approved by security holders(1)(2)
 
5,490,735

 
14.60

 
9,563,687

(3)
Equity compensation plans not approved by security holders
 

 

 

 
Total
 
5,490,735

 
14.60

 
9,563,687

(3)

(1)
Includes information regarding the following equity compensation plans: 2013 Incentive Award Plan, as amended and restated, 2004 Stock Incentive Plan, as amended, and the 2004 Employee Stock Purchase Plan, as amended and restated. As of December 31, 2019, there were 10,650 shares of restricted stock and 2,503,324 restricted stock units outstanding under the 2013 Incentive Award Plan, as amended and restated, and the 2004 Stock Incentive Plan, as amended.
(2)
Since the approval of the 2013 Incentive Award Plan, we have not granted further awards under our 2004 Stock Incentive Plan, as amended.
(3)
Includes 1,457,772 shares available under the 2004 Employee Stock Purchase Plan, as amended and restated. As of December 31, 2019, there were 28,214 shares of common stock subject to purchase under such plan.




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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Policies and Procedures for Related Person Transactions
Our board of directors has adopted written policies and procedures for the review of any transaction, arrangement or relationship in which we are a participant, the amount involved exceeds $120,000, and one of our executive officers, directors, director nominees or 5% stockholders (or their immediate family members), each of whom we refer to as a “related person,” has a direct or indirect material interest.
If a related person proposes to enter into such a transaction, arrangement or relationship, which we refer to as a “related person transaction,” the related person must report the proposed related person transaction to our Chief Legal Officer. The policy calls for the proposed related person transaction to be reviewed and, if deemed appropriate, approved by our audit committee. Whenever practicable, the reporting, review and approval will occur prior to entry into the transaction. If advance review and approval is not practicable, the audit committee will review, and, in its discretion, may ratify the related person transaction. The policy also permits the chair of the audit committee to review and, if deemed appropriate, approve proposed related person transactions that arise between committee meetings, subject to ratification by the audit committee at its next meeting. Any related person transactions that are ongoing in nature will be reviewed annually.
A related person transaction reviewed under the policy will be considered approved or ratified if it is authorized by the audit committee after full disclosure of the related person’s interest in the transaction. As appropriate for the circumstances, the audit committee will review and consider:
the related person’s interest in the related person transaction;
the approximate dollar value of the amount involved in the related person transaction;
the approximate dollar value of the amount of the related person’s interest in the transaction without regard to the amount of any profit or loss;
whether the transaction was undertaken in the ordinary course of our business;
whether the terms of the transaction are no less favorable to us than terms that could have been reached with an unrelated third party;
the purpose of, and the potential benefits to us of, the transaction; and
any other information regarding the related person transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction.
Our audit committee may approve or ratify the transaction only if the audit committee determines that, under all of the circumstances, the transaction is in our best interests. Our audit committee may impose any conditions on the related person transaction that it deems appropriate.
In addition to the transactions that are excluded by the instructions to the Securities and Exchange Commission’s related person transaction disclosure rule, our board of directors has determined that the following transactions, among others, do not create a material direct or indirect interest on behalf of related persons and, therefore, are not related person transactions for purposes of this policy:
interests arising solely from the related person’s position as an executive officer of another entity (whether or not the person is also a director of such entity), that is a participant in the transaction, where (a) the related person and all other related persons own in the aggregate less than a 10% equity interest in such entity, (b) the related person and his or her immediate family members are not involved in the negotiation of the terms of the transaction and do not receive any special benefits as a result of the transaction, and (c) the amount involved in the transaction equals less than the greater of $200,000 or 5% of the annual gross revenues of the company receiving payment under the transaction; and

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a transaction that is specifically contemplated by provisions of our charter or by‑laws.
The policy provides that transactions involving compensation of executive officers shall be reviewed and approved by our compensation committee in the manner specified in its charter.
We will disclose the terms of related person transactions in our filings with the Securities and Exchange Commission to the extent required. Since January 1, 2019, except for transactions and agreements described in our other filings with the Securities and Exchange Commission, we have not been a party to, and we have no plans to be a party to, any transaction or series of similar transactions in which the amount involved exceeded or will exceed $120,000 and in which any executive officer, director, director nominee, holder of more than 5% of our capital stock, or any member of the immediate family of any of the foregoing, had or will have a direct or indirect material interest.

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PROPOSAL TWO—
RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
The audit committee of our board of directors has selected the firm of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020. Although stockholder ratification of the appointment of Ernst & Young LLP is not required by law, our board of directors believes that it is advisable to give stockholders an opportunity to ratify this appointment. If this proposal is not approved at the Annual Meeting, our audit committee will reconsider its appointment of Ernst & Young LLP. Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting and will have the opportunity to make a statement, if they desire to do so, and will be available to respond to appropriate questions from our stockholders.
Board Recommendation
The board of directors recommends a vote FOR the ratification of the appointment by the Audit Committee of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2020.
Auditors’ Fees
The following table summarizes the fees of Ernst & Young LLP, our independent registered public accounting firm, billed to us for each of the last two fiscal years.
Fee Category
 
2019
 
2018
Audit Fees(1)
 
$
850,000

 
$
921,832

Audit‑Related Fees(2)
 
3,000

 
179,085

Tax Fees(3)
 
30,968

 
176,100

Total Fees
 
$
883,968

 
$
1,277,017


(1)
Audit fees consist of fees for the audit of our financial statements, the audit of our internal control over financial reporting, the review of the interim financial statements included in our quarterly reports on Form 10‑Q, and other professional services provided in connection with regulatory filings or engagements.
(2)
Audit‑related fees consist of fees for assurance and related services that are reasonably related to the performance of the audit and the review of our financial statements and which are not reported under “Audit Fees.” Audit‑related fees in 2018 included $175,500 in respect of audit services in connection with our strategic review.
(3)
Tax fees consist of fees for tax compliance, tax advice and tax planning services. All of the tax fees were pre‑approved by the audit committee in accordance with the pre‑approval policies and procedures described below. Tax compliance services in 2019 and 2018 include fees for federal and state tax return assistance of $25,000 and $35,600, respectively. Tax advice and tax planning services in 2019 and 2018 included fees of $5,968 and $140,500, respectively and relate to periodic consultations.
Pre‑Approval Policies and Procedures
Our audit committee has adopted policies and procedures relating to the approval of all audit and non‑audit services that are to be performed by our independent registered public accounting firm. This policy generally provides that we will not engage our independent registered public accounting firm to render audit or non‑audit services unless the service is specifically approved in advance by our audit committee or the engagement is entered into pursuant to one of the pre‑approval procedures described below.
From time to time, our audit committee may pre‑approve specified types of services that are expected to be provided to us by our independent registered public accounting firm during the next 12 months. Any such pre‑approval is detailed as to the particular service or type of services to be provided and is also generally subject to a maximum dollar amount. During

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2019, no services were provided to us by Ernst & Young LLP other than in accordance with the pre‑approval policies and procedures described above.

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PROPOSAL THREE—
ADVISORY VOTE ON EXECUTIVE COMPENSATION
The Dodd‑Frank Wall Street Reform and Consumer Protection Act of 2010, or the Dodd‑Frank Act, enables our stockholders to vote to approve, on a non‑binding advisory basis, the compensation of our Named Executives as disclosed in this proxy statement in accordance with applicable SEC rules. This vote, commonly known as a “say‑on‑pay” proposal, provides stockholders with the opportunity to express their views on our Named Executives’ compensation and is required by Section 14A of the Exchange Act. The vote is not intended to address any specific item of our executive compensation, but rather the overall compensation of our Named Executives and the philosophy, policies and practices described in this proxy statement. Since 2011, we have held a non‑binding, advisory vote on the compensation of our Named Executives annually. At our 2017 annual meeting, our stockholders voted, on an advisory basis, to hold advisory votes on executive compensation every year and we have determined to hold a non‑binding, advisory vote on the compensation of our Named Executives annually. The next such non‑binding, advisory vote will occur at the 2021 annual meeting of stockholders.
As described in the section of this proxy statement entitled “Executive Compensation,” including “Compensation Discussion and Analysis” and related compensation tables, our executive compensation program is designed to attract, retain, and motivate talented individuals with the executive experience and leadership skills necessary for us to increase stockholder value. We seek to provide executive compensation that is competitive with companies that are similar to us. We also seek to provide near‑term and long‑term financial incentives that reward executives when strategic corporate objectives designed to increase long‑term stockholder value are achieved. We believe that executive compensation should include base salary, cash incentives and equity awards. We also believe that our executive officers’ base salaries should be set at approximately median levels relative to comparable companies, and cash and equity incentives should generally be set at levels that give executives the opportunity to achieve above‑average total compensation reflecting above‑average company performance. In particular, our executive compensation philosophy is to promote long‑term value creation for our stockholders by rewarding improvement in selected financial metrics, and by using equity incentives.
We are asking stockholders to vote to approve, on a non‑binding advisory basis, following resolution:
RESOLVED, that the compensation paid to our Named Executives, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the compensation tables and any related material disclosed in this proxy statement, is hereby approved.
The say‑on‑pay vote is advisory, and therefore not binding on us, our board of directors, or the compensation committee of the board of directors. However, our board of directors and compensation committee value the opinions of our stockholders and to the extent there is any significant vote against the Named Executive compensation as disclosed in this proxy statement, we will consider our stockholders’ concerns and the compensation committee will evaluate whether any actions are necessary to address those concerns.
Board Recommendation
The board of directors recommends a vote FOR the approval of the compensation of our Named Executives as disclosed in this proxy statement.

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PROPOSAL FOUR—
APPROVAL OF AMENDMENT AND RESTATEMENT OF MOMENTA PHARMACEUTICALS, INC.
2013 INCENTIVE AWARD PLAN
Overview
In this proposal, we are requesting stockholders approve the amendment and restatement of the Momenta Pharmaceuticals, Inc. 2013 Incentive Award Plan, or the 2013 Plan, to increase the number of shares of common stock available for issuance under the 2013 Plan by 7,000,000 shares. The board of directors approved the amendment and restatement of the 2013 Plan on April 1, 2020, subject to and effective upon stockholder approval. The 2013 Plan, as amended and restated if this proposal is approved, is described in more detail below. If this proposal is not approved by our stockholders, the amendment and restatement of the 2013 Plan will not become effective, but the 2013 Plan will remain in effect in accordance with its present terms.
Board Recommendation
The board of directors recommends a vote FOR the approval of the amendment and restatement of the Momenta Pharmaceuticals, Inc. 2013 Incentive Award Plan.
Stockholder Approval Requirement
In general, stockholder approval of the amendment and restatement of the 2013 Plan will increase the number of shares available for issuance under the 2013 Plan while (1) complying with the terms of the 2013 Plan as currently in effect regarding amendments, (2) meeting the stockholder approval requirements of the principal securities market on which shares of our common stock are traded, (3) preserving our ability to grant stock options under the 2013 Plan that are intended to qualify as incentive stock options, or ISOs, as defined under Section 422 of the Code, and (4) extending the term of the 2013 Plan until April 1, 2030.
Amendment and Restatement of the 2013 Plan
On April 1, 2020, the board of directors approved an amendment and restatement of the 2013 Plan to increase the shares of common stock available for grant under the 2013 Plan by 7,000,000 shares, subject to and effective upon approval of the amendment and restatement by our stockholders. The purpose of the amendment and restatement is to permit the Company to continue using the 2013 Plan to achieve the Company’s performance, recruiting, retention and incentive goals.
We believe that continued use of the 2013 Plan is essential to our success. Equity awards are intended to motivate high levels of performance, align the interests of our directors, employees and consultants with those of our stockholders by giving directors, employees and consultants the perspective of an owner with an equity stake in the Company and providing a means of recognizing their contributions to the success of the Company. The board of directors and management believe that equity awards are necessary to remain competitive in our industry and are essential to recruiting and retaining the highly qualified employees who help the Company meet its goals.
The total number of shares reserved for issuance under the 2013 Plan before giving effect to the amendment and restatement equals the sum of: (a) 21,200,000, (b) one share for each share subject to a stock option that was granted through December 31, 2012 under our 2004 Stock Incentive Plan or our Amended and Restated 2002 Stock Incentive Plan, which we refer to together as the Prior Plans, that subsequently expires, is forfeited or is settled in cash (up to a maximum of 4,337,882 shares) and (c) (i) 1.35 shares for each share subject to an award other than a stock option that was granted through December 31, 2012 under the Prior Plans and that subsequently expired, was forfeited, was settled in cash or repurchased, in each case, prior to June 9, 2015 and (ii) 1.67 shares for each share subject to an award other than a stock option that was granted through December 31, 2012 under the Prior Plans and that subsequently expires, is forfeited, is settled in cash or repurchased, in each case, on or after June 9, 2015 (up to a maximum of 950,954 shares). Set forth below is the number of shares available for issuance pursuant to outstanding equity awards under the 2013 Plan and the Prior Plans and future equity awards under the 2013 Plan as of March 12, 2020:


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Shares subject to outstanding stock option awards(1)
6,255,236

Shares subject to outstanding stock awards(2)
2,500,650

Shares available for issuance under future awards
5,866,876


(1)
Represents shares subject to outstanding stock option awards granted under the 2013 Plan and the 2004 Stock Incentive Plan, as amended. As of March 12, 2020, options outstanding under the 2013 Plan and the 2004 Stock Incentive Plan, as amended, had a weighted average exercise price of $18.59 and a weighted average remaining life of 7.56 years. As of March 12, 2020, the market value of all shares underlying options outstanding under the 2013 Plan and the 2004 Stock Incentive Plan, as amended, was $152,189,892, based on our closing price per share on The Nasdaq Global Select Market on that date.
(2)
Represents shares subject to unvested awards of restricted stock and restricted stock units under the 2013 Plan and the 2004 Stock Incentive Plan, as amended. As of March 12, 2020, unvested awards of restricted stock and restricted stock units outstanding under the 2013 Plan and the 2004 Stock Incentive Plan, as amended, had weighted average remaining vesting terms of 0 years, for the unvested restricted stock awards, and 2.87 years, for the restricted stock unit awards. As of March 12, 2020, the market value of all shares underlying unvested restricted stock and restricted stock unit awards outstanding under the 2013 Plan and the 2004 Stock Incentive Plan, as amended, was $60,840,815, based on our closing price per share on The Nasdaq Global Select Market on that date.
For additional information regarding equity awards outstanding and available for future grants as of December 31, 2019, see “Equity Compensation Plan Information.”
If this proposal is approved, an additional 7,000,000 shares will become available for issuance under the 2013 Plan. If the amendment and restatement is not approved, the 2013 Plan will remain in effect in accordance with its present terms.
Considerations Relating to the Additional Shares Under the 2013 Plan
In recommending the amendment and restatement of the 2013 Plan to the board of directors for approval, the compensation committee reviewed employee and compensation data from the Company and analyses prepared by Radford, the committee’s independent compensation consultant. Considerations taken into account by the compensation committee included the following:
Anticipated Expansion. As a result of our Restructuring we are now a biotechnology company focused on the discovery and development of novel biologic therapies for the treatment of rare immune-mediated diseases. Given the status of our drug development pipeline we anticipate a significant increase in our employee base to support continued development and commercialization of our product candidates during 2020 and 2021. We anticipate an increase in our number of employees of approximately 85% in connection with these efforts. In addition, we anticipate, as a result of our new strategic focus and the biotechnology industry in general, an employee turnover rate of approximately 20% during 2020 and 2021. Accordingly, we anticipate an increase in new hire and/or long term equity grants to attract and to retain employees as a result of hiring needs and employee turnover.
Competitiveness. The market for high caliber, experienced talent in our industry and in our geographic location is extremely competitive. We compete not only with other similar sized and larger biotechnology companies, but we also compete for talent directly with much larger pharmaceutical companies that have significantly greater resources and generous compensation practices. Our ability to grant equity awards is critical to our ability to be competitive and to attract, retain and motivate the talent we need to best position our Company for success.
Broad‑based equity programs. We believe broad‑based equity programs are important to our ability to attract, retain and motivate employees throughout the Company and align employee interests with those of our stockholders. In 2019, less than 39% of the total equity awards granted under the 2013 Plan have gone to our Named Executives.

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Limited duration of current shares available. If we do not increase the shares available for issuance under the 2013 Plan, we expect the number of available shares under the 2013 Plan to be substantially depleted by the end of 2021 and that we would then be unable to continue to grant broad‑based equity awards. If our stockholders approve the amendment and restatement, we estimate that the shares reserved for issuance under the 2013 Plan, as amended and restated, would be sufficient for up to a year and a half of additional awards, based on projected increase in the number of employees, projected employee turnover and historical grant practices.
Reasonable burn rate. The following table sets forth the equity grant and resulting annual gross burn rate information for each of the past three years.
 
 
2019
 
2018
 
2017
Shares subject to option awards granted
 
2,136,317

 
372,690