ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
Title of class |
Trading Symbol |
Name of exchange on which registered | ||
☒ | Accelerated filer | ☐ | ||||
Non-accelerated filer |
☐ | Smaller reporting company | ||||
Emerging growth company |
Auditor Firm Id: |
Auditor Name: |
Auditor Location: |
Page |
||||||
Item 10. |
1 | |||||
Item 11. |
5 | |||||
Item 12. |
10 | |||||
Item 13. |
12 | |||||
Item 14. |
15 | |||||
Item 15. |
17 | |||||
20 |
ITEM 10. |
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE |
Name |
Age |
Position(s) | ||
Gary S. Gillheeney, Sr. |
67 | Director, President and Chief Executive Officer | ||
David C. Francisco |
56 | Chief Financial Officer | ||
Patrick Bilbo |
60 | Chief Operating Officer | ||
Lori Freedman |
55 | Vice President and General Counsel | ||
Brian Grow |
46 | Chief Commercial Officer | ||
Antonio S. Montecalvo |
56 | Vice President, Health Policy | ||
Alan A. Ades |
83 | Director, Chair of the Board | ||
Robert Ades |
48 | Director | ||
Michael J. Driscoll(1)(2) |
61 | Director | ||
Prathyusha Duraibabu(2)(3) |
43 | Director | ||
David Erani |
33 | Director | ||
Jon Giacomin(1)(3) |
57 | Director, Chair of Nominating Committee and Chair of Compensation Committee | ||
Arthur S. Leibowitz(1)(2)(3) |
68 | Director, Chair of Audit Committee | ||
Glenn H. Nussdorf |
67 | Director |
(1) | Member of the Nominating Committee. |
(2) | Member of the Audit Committee. |
(3) | Member of the Compensation Committee. |
ITEM 11. |
EXECUTIVE COMPENSATION |
Name and Principal Position |
Year |
Salary ($) |
Option Awards ($)(1) |
Stock Awards ($)(2) |
Bonus ($)(3) |
All Other Compensation ($)(5) |
Total ($) |
|||||||||||||||||||||
Gary S. Gillheeney, Sr. |
2021 | 834,637 | 2,113,992 | 706,244 | 699,200 | 76,684 | 4,430,757 | |||||||||||||||||||||
President and Chief Executive Officer |
2020 | 823,174 | 603,344 | 296,288 | 750,000 | 68,403 | 2,541,209 | |||||||||||||||||||||
Patrick Bilbo |
2021 | 433,972 | 442,378 | 147,498 | 262,200 | 45,288 | 1,331,336 | |||||||||||||||||||||
Chief Operating Officer |
2020 | 397,256 | 232,926 | 114,358 | 295,000 | 37,783 | 1,077,323 | |||||||||||||||||||||
David Francisco |
2021 | 331,731 | 658,558 | 218,746 | 213,875 | 7,585 | 1,430,495 | |||||||||||||||||||||
Chief Financial Officer |
(1) | Represents the grant date fair value of option awards granted in fiscal year 2020 and 2021 calculated in accordance with Accounting Standards Codification Topic 718, “Compensation—Stock Compensation” (“ASC 718”). See Note 14 of the notes to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of the relevant assumptions used in calculating these amounts. |
(2) | Represents the fair value of restricted stock unit awards granted in fiscal year 2020 and 2021 calculated in accordance with ASC 718. See Note 14 of the notes to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of the relevant assumptions used in calculating these amounts. |
(3) | The amounts reported in this column for fiscal 2020 and 2021 represent the discretionary bonuses earned by our NEOs. |
(4) | “All Other Compensation” for fiscal 2021 includes: (i) for Mr. Gillheeney, (a) $37,086 representing the costs related to a leased automobile, (b) a tax gross-up on the amount specified in (a) above of $15,407, (c) $12,191 representing the cost of group term life insurance, (d) $1,650 representing the cost of long-term disability insurance premiums, (e) a tax gross-up on the amount specified in (d) above of $1,650 and (f) $8,700 representing employer matching contributions under our 401(k) plan; |
Option Awards |
Stock Awards |
|||||||||||||||||||||||||||
Name |
Number of Securities Underlying Unexercised Options (#) exercisable |
Number of Securities Underlying Unexercised Options (#) unexercisable |
Option Exercise Price ($) |
Option Expiration Date |
Option Grant 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) |
|||||||||||||||||||||
Gary S. Gillheeney, Sr. |
519,860 | — | 0.99 | 7/24/2023 | 7/24/2013 | |||||||||||||||||||||||
664,804 | — | 0.99 | 8/21/2024 | 8/21/2014 | ||||||||||||||||||||||||
1,637,631 | — | 0.99 | 12/8/2024 | 12/8/2014 | ||||||||||||||||||||||||
29,760 | 435,632 | (2) | 4.04 | 4/22/2030 | 4/22/2020 | |||||||||||||||||||||||
— | 395,289 | (3) | 13.68 | 2/16/2031 | 2/16/2021 | |||||||||||||||||||||||
82,810 | 765,164 | |||||||||||||||||||||||||||
Patrick Bilbo |
152,250 | — | 1.18 | 4/22/2030 | 4/22/2020 | |||||||||||||||||||||||
142,100 | — | 3.46 | 5/4/2027 | 5/4/2017 | ||||||||||||||||||||||||
60,900 | 40,600 | (4) | 3.46 | 5/4/2027 | 5/4/2017 | |||||||||||||||||||||||
56,046 | 168,139 | (2) | 4.04 | 4/22/2030 | 4/22/2020 | |||||||||||||||||||||||
— | 82,556 | (3) | 13.68 | 2/16/2031 | 2/16/2021 | |||||||||||||||||||||||
25,103 | 231,952 | |||||||||||||||||||||||||||
David Francisco |
— | 43,239 | (5) | 12.74 | 2/15/2031 | 2/15/2021 | ||||||||||||||||||||||
— | 83,955 | (3) | 13.68 | 2/16/2031 | 2/16/2021 | |||||||||||||||||||||||
8,224 | 75,990 |
(1) | The market values of the awards set forth in this table are based on the number of awards shown multiplied by the closing price of our common stock on December 31, 2021 ($9.24), as reported by the Nasdaq Capital Market. |
(2) | The option becomes exercisable in equal annual installments over four years beginning April 1, 2020, subject to continued employment. |
(3) | The option becomes exercisable in equal annual installments over four years beginning February 16, 2021, subject to continued employment. |
(4) | Twenty percent of the shares underlying this option vested on the vesting start date, January 30, 2019, and the option vested/vests with respect to an additional 20% of the shares on each anniversary of the vesting start date thereafter, such that the option will be vested in full on January 30, 2023, subject to continued employment. |
(5) | The option becomes fully exercisable on February 15, 2022, subject to continued employment. |
• | for service as a director, an annual retainer of $50,000 (increased to $55,000 effective April 1, 2022); |
• | for service as a chair of the audit committee, $105,000 (decreased to $40,000 effective April 1, 2022); |
• | for service as a member of the audit committee other than as chair, $10,000; |
• | for service as a chair of the compensation committee, $95,000 (decreased to $20,000 effective April 1, 2022); |
• | for service as a member of the compensation committee other than as chair, $10,000; |
• | for service as a chair of the nominating committee, $20,000 (decreased to $15,000 effective April 1, 2022); and |
• | for service as a member of the nominating committee other than as a chair, $10,000 (decreased to $7,500 effective April 1, 2022). |
Name |
Fees earned or paid in cash ($)(1) |
Stock awards ($)(2) |
Total ($) |
|||||||||
Alan A. Ades |
— | — | — | |||||||||
Robert Ades |
— | — | — | |||||||||
Prathyusha Duraibabu(5) |
7,011 | 112,493 | 119,504 | |||||||||
Michael Driscoll(3) |
— | — | — | |||||||||
David Erani |
— | — | — | |||||||||
Jon Giacomin(4) |
52,762 | 112,497 | 165,259 | |||||||||
Arthur S. Leibowitz |
169,103 | 235,474 | 404,577 | |||||||||
Wayne Mackie(4) |
77,500 | 161,424 | 238,924 | |||||||||
Glenn H. Nussdorf |
— | — | — | |||||||||
Joshua Tamaroff(5) |
23,901 | 161,424 | 185,325 |
(1) | Represents amount earned or paid for service as a director during fiscal year 2021. |
(2) | Represents the grant date fair value of restricted stock unit awards granted in fiscal year 2021 in accordance with ASC 718. See Note 14 of the notes to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of the relevant assumptions used in calculating these amounts. The fair value of the restricted stock units was based on the fair market value of the Company’s stock on the date of grant. |
(3) | Dr. Driscoll was elected to the Board of Directors on February 15, 2022. |
(4) | Mr. Mackie resigned as a director effective May 7, 2021. The board of directors elected Mr. Giacomin to fill the vacancy created by his resignation effective May 7, 2021. |
(5) | Mr. Tamaroff resigned as a director effective May 24, 2021. The board of directors elected Ms. Duraibabu to fill the vacancy created by his resignation effective November 19, 2021. |
Name |
Number of Shares Underlying Options Outstanding at December 31, 2021 |
Stock Awards Outstanding at December 31, 2021 |
||||||
Alan A. Ades |
— | — | ||||||
Robert Ades |
— | — | ||||||
Prathyusha Duraibabu |
— | 11,340 | ||||||
David Erani |
— | — | ||||||
Jon Giacomin |
— | 5,319 | ||||||
Arthur S. Leibowitz |
30,000 | 35,364 | ||||||
Glenn H. Nussdorf |
— | — |
ITEM 12. |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
• | each person or entity, or group of affiliated persons or entities, known by us to beneficially own more than 5% of our common stock; |
• | each of our directors; |
• | each of our named executive officers; and |
• | all of our executive officers and directors as a group. |
Name and Address of Beneficial Owner(1) |
Number of Shares |
Right to Acquire |
Total |
Percentage of Shares Outstanding |
||||||||||||
5%+ Stockholders |
||||||||||||||||
Significant Stockholder Group(2) |
59,448,027 | — | 59,448,027 | 46.1 | % | |||||||||||
Organo PFG LLC and affiliated entities(3) |
11,131,474 | — | 11,131,474 | 8.6 | % | |||||||||||
Deerfield Mgmt, L.P.(4) |
8,456,876 | — | 8,456,876 | 6.6 | % | |||||||||||
BlackRock, Inc.(5) |
8,239,832 | — | 8,239,832 | 6.4 | % | |||||||||||
Michael W. Katz(6) |
1,479,062 | 60,000 | 1,539,062 | 1.2 | % | |||||||||||
Directors and Named Executive Officers |
||||||||||||||||
Gary S. Gillheeney, Sr. |
35,233 | 3,096,089 | 3,131,322 | 2.4 | % | |||||||||||
Alan A. Ades(7) |
26,375,746 | — | 26,375,746 | 20.4 | % | |||||||||||
Robert Ades |
— | — | — | — | ||||||||||||
Michael J. Driscoll |
— | — | — | — | ||||||||||||
Prathyusha Duraibabu |
— | — | — | — | ||||||||||||
David Erani |
— | — | — | — | ||||||||||||
Jon Giacomin |
— | 1,773 | 1,773 | * | ||||||||||||
Arthur S. Leibowitz |
42,307 | 30,000 | 72,307 | * | ||||||||||||
Glenn H. Nussdorf(8) |
14,963,663 | — | 14,963,663 | 11.6 | % | |||||||||||
Patrick Bilbo |
105,133 | 508,281 | 613,414 | * | ||||||||||||
David Francisco |
5,308 | 64,228 | 69,536 | * | ||||||||||||
All directors and executive officers as a group (14 individuals) |
41,561,613 | 4,372,779 | 45,934,392 | 34.4 | % |
* | Less than one percent. |
(1) | Unless otherwise indicated, the business address of each of the individuals is c/o Organogenesis Holdings Inc., 85 Dan Road, Canton, Massachusetts 02021. |
(2) | Alan A. Ades, Albert Erani, Glenn H. Nussdorf, Dennis Erani, Starr Wisdom and certain of their respective affiliates, including Organo PFG LLC, Organo Investors LLC, Dennis Erani 2012 Issue Trust, Alan Ades as Trustee of the Alan Ades 2014 GRAT, Albert Erani Family Trust dated 12/29/2012, RED Holdings, LLC, GN 2016 Family Trust u/a/d August 12, 2016 and GN 2016 Organo 10-Year GRAT u/a/d September 30, 2016, who we refer to collectively as the Significant Stockholder Group, control a significant amount of the voting power of the outstanding Class A common stock. The Significant Stockholder Group reported that they hold their shares of our stock as part of a group (as defined in Section 13(d)(3) of the Exchange Act) for the purposes of reporting beneficial ownership of the Company’s securities in an Amendment No. 6 to Schedule 13D filed on December 30, 2021. |
(3) | Consists of (i) 8,279,490 shares of Class A common stock held by Organo PFG LLC and (ii) 2,851,984 shares of Class A common stock held by Organo Investors LLC. Alan A. Ades and Albert Erani are managing members of Organo PFG LLC and of Organo Investors LLC and they share voting and investment power over the shares of Class A common stock held by each entity. Each of Mr. Ades and Mr. Erani disclaim beneficial ownership of the shares of Class A common stock held by each of Organo PFG LLC and Organo Investors LLC, except to the extent of his pecuniary interest therein. The address of each of the foregoing is c/o Rugby Realty Co., Inc., 300 Lighting Way, Secaucus, NJ 07094. |
(4) | Consists of 8,456,876 shares of Class A common stock held by Deerfield Partners, L.P., of which Deerfield Mgmt, L.P. is the general partner and Deerfield Management Company, L.P. is the investment advisor. Deerfield Partners, L.P. shares voting and dispositive power with respect to the 8,456,876 shares of Class A common stock with Deerfield Mgmt, L.P., Deerfield Management Company, L.P. and James E. Flynn according to a Schedule 13G filed with the SEC on February 11, 2022. The address of each of the foregoing is 345 Park Avenue South, 12th Floor, New York, NY 10010. |
(5) | Consists of 8,239,832 shares of Class A common stock held by BlackRock, Inc., and its subsidiaries (collectively, “BlackRock”). BlackRock had sole voting power with respect to 8,202,597 shares and sole dispositive power with respect to 8,239,832 shares according to a Schedule 13G filed with the SEC on February 4, 2022. The address of the foregoing is 55 East 52nd Street, New York, NY 10055. |
(6) | Consists of: (i) 60,382 shares of Class A common stock, (ii) 1,418,680 shares of Class A common stock (the “Trust Shares”) held by the GN 2016 Family Trust u/a/d August 12, 2016 (the “Trust”) and (iii) 60,000 shares of Class A common stock underlying stock options that are exercisable as of April 10, 2022, or will become exercisable within 60 days after such date. Mr. Katz is the trustee of the Trust, a stockholder of the issuer that is a member of a group holding over 10% of the outstanding shares of Class A common stock of the issuer for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended. Mr. Katz exercises voting and investment control over the Trust Shares, but Mr. Katz does not have a pecuniary interest in the Trust Shares. |
(7) | Consists of (i) 8,406,498 shares of Class A common stock, (ii) 6,837,774 shares of Class A common stock held by Alan Ades as Trustee of the Alan Ades 2014 GRAT, (iii) 8,279,490 shares of Class A common stock held by Organo PFG LLC and (iv) 2,851,984 shares of Class A common stock held by Organo Investors LLC. Mr. Ades exercises voting and investment power over the shares of Class A common stock held by Alan Ades as Trustee of the Alan Ades 2014 GRAT, Organo PFG LLC and Organo Investors LLC. Mr. Ades disclaims beneficial ownership of the shares of Class A common stock held by each of Alan Ades as Trustee of the Alan Ades 2014 GRAT, Organo PFG LLC and Organo Investors LLC, except to the extent of his pecuniary interest therein. |
(8) | Consists of (i) 2,783,663 shares of Class A common stock, (ii) 1,418,680 shares of Class A common stock held by GN 2016 Family Trust u/a/d August 12, 2016 and (iii) 10,761,320 shares of Class A common stock held by GN 2016 Organo 10-Year GRAT u/a/d September 30, 2016. Mr. Nussdorf exercises voting and investment power over the shares of Class A common stock held by GN 2016 Organo 10-Year GRAT u/a/d September 30, 2016. Mr. Michael Katz, as trustee, exercises and Mr. Nussdorf may be deemed to exercise voting and investment power over the shares of Class A common stock held by GN 2016 Family Trust u/a/d August 12, 2016. Mr. Nussdorf disclaims beneficial ownership of the shares of Class A common stock held by GN 2016 Organo 10-Year GRAT u/a/d September 30, 2016, except to the extent of his pecuniary interest therein, and each of Mr. Nussdorf and Mr. Katz disclaims beneficial ownership of the shares of Class A common stock held by GN 2016 Family Trust u/a/d August 12, 2016, except to the extent of his pecuniary interest therein. The address of each of the foregoing (other than Mr. Katz) is 35 Sawgrass Drive, Bellport, NY 11713. |
(9) | Consists of (i) 41,561,613 shares of Class A common stock, (ii) 4,368,918 shares of Class A common stock underlying stock options that are exercisable as of April 10, 2022 or will become exercisable within 60 days after such date and (iii) 3,861 shares of Class A common stock underlying restricted stock units that will vest within 60 days of April 10, 2022. As to disclaimers of beneficial ownership, see footnotes (2), (7) and (8) above. |
Plan Category |
Number of securities to be issued upon exercise of outstanding options, warrants and rights, and vesting of outstanding restricted stock units (a) |
Weighted-average exercise price of outstanding options, warrants and rights (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: |
7,361,840 | (1) | $ | 4.10 | 5,644,691 | (2) | ||||||
Equity compensation plans not approved by security holders: |
— | $ | — | — | ||||||||
Totals: |
7,361,840 | $ | 4.10 | 5,644,691 |
(1) | Consists of shares of our Class A common stock issuable upon exercise of outstanding options and vesting of outstanding restricted stock units issued under the 2018 Plan and the 2003 Plan. |
(2) | Consists of shares of our Class A common stock reserved for future issuance under the 2018 Plan. |
ITEM 13. |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORS INDEPENDENCE |
Shares of Class A Common Stock Purchased |
Aggregate Cash Purchase Price |
|||||||
Alan Ades(1) |
486,000 | $ | 1,579,500.00 | |||||
Michael Katz |
20,829 | $ | 67,694.25 | |||||
Arthur Leibowitz |
6,943 | $ | 22,564.75 | |||||
Wayne Mackie |
42,726 | $ | 138,859.50 | |||||
Robert Harry Erani Frick Trust(2) |
347,153 | $ | 1,128,247.25 |
(1) | Includes shares purchased by Mr. Ades as agent for and for the benefit of one of his sons and an entity that is managed by Mr. Ades’ son-in-law. |
(2) | An affiliate of Dennis Erani, a member of the Significant Stockholder Group. |
ITEM 14. |
PRINCIPAL ACCOUNTANT FEES AND SERVICES |
Fee Category |
Fiscal 2021 |
Fiscal 2020 |
||||||
Audit fees |
$ | 1,134,105 | $ | 670,425 | ||||
Audit-related fees |
— | — | ||||||
Tax fees |
$ | 63,000 | — | |||||
All other fees |
— | — | ||||||
Total fees |
$ | 1,197,105 | $ | 670,425 | ||||
ITEM 15. |
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES |
* | Filed herewith. |
** | Previously filed. |
† | Confidential treatment granted as to portions of this Exhibit. The confidential portions of this Exhibit have been omitted and are marked by asterisks. |
‡ | Management contract or compensatory plan or arrangement. |
ORGANOGENESIS HOLDINGS INC. | ||
By: | /s/ Gary S. Gillheeney, Sr. | |
Gary S. Gillheeney, Sr. | ||
President and Chief Executive Officer | ||
Date: | April 29, 2022 |