| Table of Contents |
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
| Filed by the Registrant ý | Filed by a party other than the Registrant ¨ |
Check the appropriate box:
| ¨ | Preliminary Proxy Statement |
| ¨ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
| ý | Definitive Proxy Statement |
| ¨ | Definitive Additional Materials |
| ¨ | Soliciting Material Pursuant to § 240.14a-12 |
KRONOS BIO, INC.
(Name of Registrant as Specified In Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box)
| ý | No fee required |
| ¨ | Fee paid previously with preliminary materials. |
| ¨ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11. |
 |
1300 So. El Camino Real, Suite 400 San Mateo, California 94402 |
Notice of Annual Meeting of Shareholders
Date:
Thursday, June 22, 2023
Time:
4:00 p.m., ET
Venue:
Virtual Meeting
Your
Vote
is Important.
Whether or not you plan to attend the Annual Meeting, we urge you to submit your vote via the Internet, telephone or mail as soon as possible to ensure your shares are represented. For additional instructions on voting by telephone or the Internet, please refer to your proxy card. Returning the proxy does not deprive you of your right to attend the Annual Meeting and to vote your shares at the Annual Meeting.
Dear Stockholder:
To be held on June 22, 2023
You are cordially invited to attend the 2023 Annual Meeting of Stockholders (“Annual Meeting”) of Kronos Bio, Inc., a Delaware corporation (the “Company”). The meeting will be held on June 22, 2023 at 4:00 p.m., Eastern Time. This year’s Annual Meeting will be a completely virtual meeting of stockholders. You can attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/KRON2023 where you will be able to listen to the meeting live, submit questions and vote online. We are holding the Annual Meeting for the following purposes, as more fully described in the accompanying proxy statement:
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To elect the Board of Directors’ three nominees for director named herein to hold office until the 2026 Annual Meeting of Stockholders. |
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To approve, on an advisory basis, the compensation of the Company’s named executive officers, as disclosed in the proxy statement accompanying this notice. |
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To ratify the selection by the Audit Committee of the Board of Directors of Ernst & Young LLP as the independent registered public accounting firm of the Company for its fiscal year ending December 31, 2023. |
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To conduct any other business properly brought before the meeting. |
These items of business are more fully described in the Proxy Statement accompanying this Notice.
The record date for the Annual Meeting is April 24, 2023. Only stockholders of record at the close of business on that date may vote at the meeting or any adjournment thereof.
By Order of the Board of Directors,
Barbara A. Kosacz
Secretary
San Mateo, California
April 27, 2023
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1300 So. El Camino Real, Suite 400 San Mateo, California 94402 |
| Kronos Bio | 1 | 2023 Proxy Statement |
| during, the Annual Meeting so they can ask questions of our Board or management. During the Annual Meeting, we may answer questions submitted during the Annual Meeting and address those asked in advance, to the extent relevant to the business of the Annual Meeting, as time permits. We do not intend to post questions received during the Annual Meeting to our website. | ||
| What do I need to do to attend the Annual Meeting? |
You will be able to attend the Annual Meeting online, submit your questions during the meeting and vote your shares electronically at the meeting by visiting www.virtualshareholdermeeting.com/KRON2023. To participate in the Annual Meeting, you will need the control number included on your Notice or proxy card. The Annual Meeting webcast will begin promptly at 4:00 p.m. Eastern Time on June 22, 2023. We encourage you to access the meeting prior to the start time. Online check-in will begin at 3:45 p.m. Eastern Time, and you should allow ample time for the check-in procedures. | |
| Who can vote at the Annual Meeting? |
Only stockholders of record at the close of business on April 24, 2023 will be entitled to vote at the Annual Meeting. On this record date, there were 57,630,464 shares of common stock outstanding and entitled to vote. A list of our stockholders of record will be open for examination by any stockholder for the ten days ending the day prior to the Annual Meeting at our headquarters located at 1300 So. El Camino Real, Suite 400, San Mateo, California 94402. If you would like to view the list, please contact our Corporate Secretary to schedule an appointment by calling (650) 781-5200 or writing to the Corporate Secretary at the address above. In addition, the list will be available for inspection by stockholders on the virtual meeting website during the Annual Meeting. Stockholder of Record: Shares Registered in Your
Name Beneficial Owner: Shares Registered in the Name
of a Broker or Bank |
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| What am I voting on? |
There are three matters scheduled for a vote: | ||
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Proposal 1: Election of the Board’s three nominees for director named herein to hold office until the 2026 Annual Meeting of Stockholders; | ||
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Proposal 2: Advisory approval of the compensation of the Company’s named executive officers, as disclosed in this proxy statement in accordance with SEC rules; | ||
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Proposal 3: Ratification of the selection, by the Audit Committee of the Board, of Ernst & Young LLP as the independent registered public accounting firm of the Company for its fiscal year ending December 31, 2023. | ||
| What if another matter is properly brought before the meeting? |
The Board knows of no other matters that will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the meeting, it is the intention of the persons named in the accompanying proxy to vote on those matters in accordance with their best judgment. | |
| How do I vote? |
You may vote “For” all the nominees to the Board of Directors, you may “Withhold” your vote for all nominees, or you may “Withhold” your vote for any nominee you specify. For both of the other proposals to be voted on, you may vote “For” or “Against” or abstain from voting. The procedures for voting are fairly simple as described below: Stockholder of Record: Shares Registered in Your
Name |
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| To vote live at the Annual Meeting, attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/KRON2023, where stockholders may vote and submit questions during the meeting (have your Notice or proxy card in hand when you visit the website). |
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Vote
by Proxy Card simply complete, sign and date the proxy card that may be delivered to you and return it promptly in the envelope provided. If you return your signed proxy card to us before the Annual Meeting, we will vote your shares as you direct. |
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Vote
by Telephone dial toll-free 1-800-690-6903 and follow the recorded instructions. You will be asked to provide the company number and control number from the Notice. Your telephone vote must be received by 11:59 p.m., Eastern Time, on June 21, 2023 to be counted. |
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Vote
by Internet go to www.proxyvote.com and follow the on-screen instructions to complete an electronic proxy card or scan the QR code on your proxy notice with your smartphone. You will be asked to provide the control number from the Notice. Your internet vote must be received by 11:59 p.m., Eastern Time, on June 21, 2023 to be counted. |
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Beneficial Owner: Shares Registered in the Name of Broker or Bank If you are a beneficial owner of shares registered in the name of your broker, bank, or other agent, you should have received a Notice containing voting instructions from that organization rather than from Kronos Bio. Simply follow the voting instructions in the Notice to ensure that your vote is counted. To vote live online at the Annual Meeting, you must obtain a valid proxy from your broker, bank or other agent. Follow the instructions from your broker or bank included with these proxy materials, or contact your broker or bank to request a proxy form. Internet proxy voting is being provided to allow you to vote your shares online, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions. However, please be aware that you must bear any costs associated with your internet access, such as usage charges from internet access providers and telephone companies. |
| How many votes do I have? |
On each matter to be voted upon, you have one vote for each share of common stock you owned as of the close of business on April 24, 2023. |
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| What happens if I do not vote? |
Stockholder of Record: Shares Registered in Your
Name Beneficial Owner: Shares Registered in the Name
of Broker or Bank If you are a beneficial owner of shares held in street name, in order to ensure your shares are voted in the way you would prefer, you must provide voting instructions to your broker, bank or other agent by the deadline provided in the materials you receive from your broker, bank or other agent. | |
| What if I return a proxy card or otherwise vote but do not make specific choices? |
If you return a signed and dated proxy card or otherwise vote without marking voting selections, your shares will be voted, as applicable, (i) “For” the election of the three nominees for director; (ii) “For” the advisory approval of executive compensation; and (iii) “For” the ratification of the selection by the Audit Committee of the Board of Directors of Ernst & Young LLP as the independent registered public accounting firm of the Company for its fiscal year ending December 31, 2023. If any other matter is properly presented at the meeting, your proxyholder (one of the individuals named on your proxy card) will vote your shares using his or her best judgment. | |
| Who is paying for this proxy solicitation? |
We will pay for the entire cost of soliciting proxies. In addition to these proxy materials, our directors and employees may also solicit proxies in person, by telephone, or by other means of communication. Directors and employees will not be paid any additional compensation for soliciting proxies. We may also reimburse brokerage firms, banks and other agents for the cost of forwarding proxy materials to beneficial owners. | |
| What does it mean if I receive more than one Notice? |
If you receive more than one Notice, your shares may be registered in more than one name or in different accounts. Please follow the voting instructions on each of the Notices to ensure that all of your shares are voted. |
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| Can I change my vote after submitting my proxy? |
Stockholder of Record: Shares Registered in Your
Name ●You may submit another properly completed proxy card with a later date. ●You may grant a subsequent proxy by telephone or through the internet. ●You may send a timely written notice that you are revoking your proxy to the Company’s Secretary at 1300 So. El Camino Real, Suite 400, San Mateo, California 94402. ●You may attend and vote online at the Annual Meeting (although attendance at the Annual Meeting will not, by itself, revoke a proxy). Your most current proxy card or telephone or internet proxy is the one that is counted. Beneficial Owner: Shares Registered in the Name
of Broker or Bank | |
| When are stockholder proposals and director nominations due for next year’s annual meeting? |
To be considered for inclusion in next year’s proxy materials, your proposal must be submitted in writing by December 29, 2023, to Kronos Bio, Inc., Attn: Secretary, 1300 So. El Camino Real, Suite 400, San Mateo, California 94402. If you wish to submit a proposal (including a director nomination) at the meeting, you must do so between February 23, 2024 and March 24, 2024. You are also advised to review the Company’s Bylaws, which contain additional requirements relating to advance notice of stockholder proposals and director nominations. In addition to satisfying the foregoing requirements under the Company’s Bylaws, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than our Board’s nominees must provide notice that sets forth any additional information required by Rule 14a-19 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). | |
| How are votes counted? |
Votes will be counted by the inspector of election appointed for the meeting, who will separately count, for the proposal to elect directors, votes “For,” “Withhold” and broker non-votes; and with respect to each other proposal, votes “For,” “Against,” abstentions and, if applicable, broker non-votes. Abstentions will be counted towards the vote total for Proposal 2 and Proposal 3, and will have the same effect as votes “Against” votes. Broker non-votes will be counted towards the presence of a quorum but will not be counted towards the vote total for any proposal. | |
| What are “broker non-votes”? |
As discussed above, when a beneficial owner of shares held in “street name” does not give instructions to the broker or nominee holding the shares as to how to vote on matters deemed by the NYSE to be “non-routine,” the broker or nominee cannot vote the shares. These unvoted shares are counted as “broker non-votes.” |
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| How many votes are needed to approve each proposal? |
For the election of directors, the three nominees receiving the most “For” votes from the holders of shares present or represented by proxy and entitled to vote on the election of directors will be elected. Only votes “For” will affect the outcome. Proposal 2, advisory approval for the compensation of the Company’s named executive officers, will be considered to be approved if it receives “For” votes from the holders of the majority of shares present at the Annual Meeting or represented by proxy and entitled to vote on the matter. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes will have the same effect as “Against” votes. To be approved, Proposal 3, ratification of the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm for its fiscal year ending December 31, 2023, must receive “For” votes from the holders of a majority of shares present at the Annual Meeting or represented by proxy and entitled to vote on the matter. If you “Abstain” from voting, it will have the same effect as an “Against” vote. Broker non-votes, if any, will have no effect, but we do not expect there to be any broker non-votes for this proposal. | |
| What is the quorum requirement? |
A quorum of stockholders is necessary to hold a valid meeting. A quorum will be present if stockholders holding at least a majority of the outstanding shares entitled to vote is present at the meeting or represented by proxy. On the record date, there were 57,630,464 shares outstanding and entitled to vote. Thus, the holders of at least 28,815,233 shares must be present at the meeting or represented by proxy at the meeting to have a quorum. Your shares will be counted towards the quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker, bank or other nominee) or if you vote live online at the meeting. Abstentions and broker non-votes will be counted towards the quorum requirement. If there is no quorum, the holders of a majority of shares present at the meeting or represented by proxy may adjourn the meeting to another date. | |
| How can I find out the results of the voting at the Annual Meeting? |
Preliminary voting results will be announced at the Annual Meeting. In addition, final voting results will be published in a current report on Form 8-K that we expect to file within four business days after the Annual Meeting. If final voting results are not available to us in time to file a Form 8-K within four business days after the meeting, we intend to file a Form 8-K to publish preliminary results and, within four business days after the final results are known to us, file an additional Form 8-K to publish the final results. |
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Proposal
1
Election of Directors
Our Board of Directors is divided into three classes. Each class consists, as nearly as possible, of one-third of the total number of directors, and each class has a three-year term. Vacancies on the Board may be filled only by persons elected by a majority of the remaining directors. A director elected by the Board to fill a vacancy in a class, including vacancies created by an increase in the number of directors, shall serve for the remainder of the full term of that class and until the director’s successor is duly elected and qualified.
Our Board of Directors currently consists of ten members. There are three directors in Class III, whose term of office expires at the Annual Meeting: Arie Belldegrun, M.D. FACS, Joshua Kazam, and Elena Ridloff, CFA. Dr. Belldegrun, Mr. Kazam and Ms. Ridloff have been nominated for re-election at the Annual Meeting.
Dr. Belldegrun, Mr. Kazam, and Ms. Ridloff, each of whom is a current director of the Company appointed by our Board, were each recommended by the Nominating and Corporate Governance Committee of the Board for nomination to the Board at the Annual Meeting. Each nominee for director to be elected at the Annual Meeting will serve for a three-year term until our 2026 Annual Meeting of Stockholders, and until his or her successor is duly elected and qualified, or until his or her earlier death, resignation or removal. It is our policy to invite directors and nominees for director to attend the Annual Meeting. All of our directors other than Dr. Belldegrun, Dr. Yang and Dr. De Backer attended our 2022 Annual Meeting of Stockholders.
Directors are elected by a plurality of the votes of the holders of shares present at the Annual Meeting or represented by proxy and entitled to vote at the Annual Meeting. Accordingly, the three nominees receiving the most “For” votes (among votes properly cast at the Annual Meeting or by proxy) will be elected. If no contrary indication is made, shares represented by executed or authenticated proxies will be voted “For” the election of the three nominees named above or, if any nominee becomes unavailable for election as a result of an unexpected occurrence, “For” the election of a substitute nominee designated by our Board. Each nominee has agreed to serve as a director if elected and we have no reason to believe that any nominee will be unable to serve.
The Nominating and Corporate Governance Committee seeks to assemble a Board that, as a whole, possesses the appropriate balance of professional and industry knowledge, financial expertise and high-level management experience necessary to oversee and direct the Company’s business. The Nominating and Corporate Governance Committee also seeks to attain diversity and balance among directors of race, gender, geography, thought, viewpoints, and backgrounds. To those ends, the Nominating and Corporate Governance Committee has identified and evaluated nominees in the broader context of the Board’s overall composition, with the goal of recruiting members who complement and strengthen the skills of other members through diversity and who also exhibit
Vote
The Board of Directors Recommends A Vote “For” Each Named Nominee.
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integrity, collegiality, sound business judgment, and other qualities that the Nominating and Corporate Governance Committee views as critical to effective functioning of the Board. The brief biographies below include information, as of the date of this proxy statement, regarding the specific and particular experience, qualifications, attributes or skills of each director nominee that led the Nominating and Corporate Governance Committee to believe that that nominee should continue to serve on the Board. However, each of the members of the Nominating and Corporate Governance Committee may have a variety of reasons why he or she believes a particular person would be an appropriate nominee for the Board, and these views may differ from the views of other members.
The following is a brief biography of each director nominee, each director in the classes who are not standing for election at the Annual Meeting and whose term will continue after the Annual Meeting, and each of our executive officers.
Nominees for Election for a Three-year Term Expiring at the 2026 Annual Meeting
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Arie Belldegrun, M.D. FACS. Age: 73 |
Arie S. Belldegrun, M.D., FACS, 73, has served as Chair of our board of directors since November 2017. Dr. Belldegrun is a co-founder of Allogene Therapeutics, a public biopharmaceutical company, and has served as Executive Chairman of its board of directors since November 2017. From March 2014 until October 2017, Dr. Belldegrun served as the President and Chief Executive Officer of Kite Pharma, Inc. and as a member of its board of directors from June 2009 until October 2017. Dr. Belldegrun currently serves as Chairman of Bellco Capital LLC, a position he has held since 2004, Chairman of UroGen Pharma, Ltd., a position he has held since December 2012, as Chairman and Partner of Two River Group, a position he has held since June 2009, as co-Chairman of Breakthrough Properties LLC and Breakthrough Services, L.L.C., a position he has held since April 2019, as a director of ByHeart, Inc., a position he has held since October 2019, as a director of IconOVir Bio, Inc., a position he has held since June 2020, and as a director of Ginkgo Bioworks, a position he has held since September 2021. Dr. Belldegrun has also served as Senior Managing Director of Vida Ventures, LLC since November 2017. Dr. Belldegrun previously served as a director of Teva Pharmaceutical Industries Ltd. from March 2013 until January 2017, Chairman of Arno Therapeutics, Inc. from March 2008 until January 2017, a director of Capricor Therapeutics, Inc. from September 2009 until November 2013, and a director of SonaCare Medical, LLC from October 2009 until October 2014. In 1996, he founded Agensys, Inc., a biotechnology company, where he served as its founding Chairman from 1996 to 2001, and continued to serve on the board until 2007 when it was acquired by Astellas Pharma Inc. Dr. Belldegrun was also the Founding Vice-Chairman of the board of directors and Chairman of the scientific advisory board of Cougar Biotechnology, Inc., a biotechnology company, from 2003 to 2009, when it was acquired by Johnson & Johnson. He is certified by the American Board of Urology and the American Association of Genitourinary Surgeons. Dr. Belldegrun is Research Professor, holds the Roy and Carol Doumani Chair in Urologic Oncology, and Director of the Institute of Urologic Oncology at the David Geffen School of Medicine at the University of California, Los Angeles (“UCLA”). Prior to joining UCLA in October of 1988, he was a research fellow at NCI/NIH in surgical oncology and immunotherapy from July 1985 to August 1988 under Dr. Steven Rosenberg. Dr. Belldegrun received his M.D. from the Hebrew University Hadassah Medical School in Jerusalem before completing his post graduate studies in Immunology at the Weizmann Institute of Science and his residency in Urologic Surgery at Harvard Medical School. | |
| We believe Dr. Belldegrun is qualified to serve on our Board due to his experience as a senior executive and as a director of several life sciences companies, and because of his knowledge of our industry. |
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Joshua Kazam Age:
46 |
Joshua Kazam, 46, has served as a member of our board of directors since our inception in June 2017. Mr. Kazam currently serves on the board of directors of Allogene Therapeutics, a public biopharmaceutical company, and served as its President from November 2017 until June 2018. He was a founder of Kite Pharma, Inc. and served as a member of its board of directors from its inception in June 2009 until October 2017. In June 2009, Mr. Kazam co-founded Two River LLC a life-science company building firm. Mr. Kazam has served on the board of Vision Path, Inc. (d/b/a HubbleContacts) since May 2016, ByHeart, Inc. since November 2016, Breakthrough Properties LLC and Breakthrough Services LLC since April 2019, and FlyingEagle Acquisition Corp. from February 2020. Mr. Kazam previously served as a director of Diamond Eagle Acquisition Corp. from January 2019 until April 2020, Capricor Therapeutics, Inc. from May 2005 until May 2019 and Platinum Eagle Acquisition Corp. from January 2018 to March 2019 and TS Innovation Acquisition from October 2020 until May 2021 as well as TS Innovation II, Platinum Eagle Acquisition Corp., Diamond Eagle Acquisition Corp. and FlyingEagle Acquisition Corp. TS Innovations are blank check companies formed for the purpose of effecting a business combination with one or more businesses. Mr. Kazam has served as the President of Desert Flower Foundation since June 2016. Mr. Kazam received his B.A. in Entrepreneurial Management from the Wharton School of the University of Pennsylvania and is a Member of the Wharton School’s Undergraduate Executive Board. We believe Mr. Kazam is qualified to serve on our Board due to his experience serving on the boards of directors of clinical-stage life sciences companies, and because of his investment experience in the life sciences industry. |
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Elena Ridloff, Age: 43 |
Elena H. Ridloff, CFA, 43, has served as a member of our board of directors since September 2020. Ms. Ridloff is currently the Chief Financial Officer of Sionna Therapeutics, Inc., a private biotechnology company. Previously she held multiple roles at Acadia Pharmaceuticals, Inc., a public biotechnology company, from April 2018 to September 2021, including as Executive Vice President and Chief Financial Officer of Acadia. Previously, Ms. Ridloff held various roles at Alexion Pharmaceuticals, Inc., a public biopharmaceutical company, including Executive Director, Investor Relations from April 2014 to January 2016, and Vice President, Investor Relations from January 2016 to March 2018. Ms. Ridloff also served as a member of Alexion’s Operating Committee. While at Alexion, Ms. Ridloff was responsible for building and leading an investor relations function. Prior to joining Alexion, Ms. Ridloff served as the Chief Executive Officer and Managing Member of BIOVISIO, an independent consulting firm providing strategic, financial and investor relations counsel to the life sciences industry, from January 2012 to April 2014. Ms. Ridloff also served as Managing Director at Maverick Capital, a hedge fund responsible for investments in the biotechnology, pharmaceutical, medical device and life science sectors, from July 2005 to January 2012. Ms. Ridloff received her B.A. in History and Sociology of Science from the University of Pennsylvania and is a Chartered Financial Analyst. We believe Ms. Ridloff is qualified to serve on our Board due to her financial and accounting expertise and her experience in the finance and life sciences industries. |
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Directors Continuing in Office Until the 2024 Annual Meeting
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Norbert Bischofberger, Ph.D. Age: 67 |
Norbert Bischofberger, Ph.D., 67, has served as our President and Chief Executive Officer since August 2018 and as a member of our board of directors since April 2018. From August 1990 to August 2018, Dr. Bischofberger held various positions at Gilead Sciences, Inc., a biopharmaceutical company, and most recently served Gilead as Executive Vice President, Research and Development and Chief Scientific Officer. During his 28-year tenure at Gilead, he presided over the development and approval of more than 25 medicines for a range of serious conditions. Prior to Gilead, Dr. Bischofberger served as a Senior Scientist in the DNA Synthesis group at Genentech, Inc., a biotechnology company, from 1986 to 1990. Dr. Bischofberger serves on the Supervisory Board of Bayer AG and Board of Directors of Morphic Therapeutic, a public biopharmaceutical company. Dr. Bischofberger received a Ph.D. in Organic Chemistry from the Eidgenossische Technische Hochschule in Zurich, Switzerland and an M.S. in Chemistry from the University of Innsbruck. We believe Dr. Bischofberger is qualified to serve on our Board due to his expertise and experience in the life sciences industry, including his work as a senior executive, and his educational background. | |
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Roger D. Dansey, M.D. Age:
67 |
Roger Dansey, M.D., 67, joined our Board of Directors in April 2023. Dr. Dansey currently serves as President, Research and Development, at Seagen, Inc., a public biopharmaceutical company, and has held various positions there since May, 2018. Prior to that, Dr. Dansey served as Senior Vice President, Clinical Oncology Research at Merck & Co. from January 2015 through April 2018. While at Merck, Dr. Dansey was Therapeutic Area Head for Late Stage Oncology and was responsible for the ongoing registration efforts for KEYTRUDA® (pembrolizumab) across multiple tumor types. Prior to Merck, from August 2013 to December 2014, Dr. Dansey served as the Vice President, Oncology Clinical Research at Gilead Sciences, Inc. Dr. Dansey previously worked at Amgen in roles of increasing responsibility in Amgen’s oncology and hematology therapeutic areas, including as the Global Development Leader for XGEVA®. Dr. Dansey currently serves as a director of INOVIO Pharmaceuticals, Inc., a publicly traded biotechnology company. Dr. Dansey received his medical degrees from the University of Witwatersrand, Johannesburg, South Africa. We believe Dr. Dansey is qualified to serve on our Board due to his expertise and experience in the life sciences industry, including his experience as a senior executive, and his educational background. |
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Marianne De Backer, Ph.D. Age: 55 |
Marianne De Backer, Ph.D., 55, joined our Board of Directors in January 2021. Dr. De Backer recently became Chief Executive Officer and a member of the Board of Directors of Vir Biotechnology, Inc., a public biotechnology company, in April 2023. Previously, Dr. De Backer was Executive Vice President, Head of Strategy, Global Business Development & Licensing and Open Innovation, and a member of the Executive Committee of the Pharmaceuticals Division of Bayer AG. Before joining Bayer, Dr. De Backer held a series of positions in the Johnson & Johnson family of companies. She started as a scientist and scientific group leader during which time her work resulted in multiple patents. She progressed through commercial positions internationally including leading a sales and marketing business unit responsible for several product lines, culminating as Vice President, M&A Operations, Divestitures, and Janssen Business Development. During her tenure with Johnson & Johnson, Dr. De Backer had direct accountability for over 200 strategic alliances. She also serves on the Board of Arrowhead Pharmaceuticals (ARWR). In 2022, Dr. De Backer was recognized by BCG and Manager Magazine as one of the 100 Most Influential Women in German business and Top 25 Women Leaders in Biotechnology by Healthcare Technology Report. In 2021, she was named one of the Fiercest Women in Life Sciences by Fierce Pharma. Dr. De Backer received a MSc in Molecular Biology from the University of Brussels, Belgium, a Masters in Engineering and Biochemistry and a Ph.D. in Biotechnology from the University of Ghent, Belgium, and an MBA from Rotterdam School of Management, Erasmus University, The Netherlands. We believe Dr. De Backer is qualified to serve on our Board due to her expertise and experience in the life sciences industry and her educational background. |
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Taiyin Yang, Ph.D. Age:
69 |
Taiyin Yang, Ph.D., 69, joined our board of directors in March 2021. Dr. Yang is the former Executive Vice President of Pharmaceutical Development and Manufacturing at Gilead Sciences, Inc., a public biopharmaceutical company, until July 2022. She directed operations of chemical and biologics process development, device and formulation development, manufacturing, packaging, analytical operations, laboratory information systems, data science, quality assurance, CMC regulatory affairs, program management, supply chain management and site operations for all the company’s small molecules, biologics and antibody-drug conjugates of investigational compounds and marketed products. Under her leadership, Gilead developed the world’s first HIV single table regimen and advanced more than 25 compounds from early-stage development to market, reaching millions of people around the world. Prior to joining Gilead in 1993, Dr. Yang worked at Syntex Corporation from 1980 where she contributed to the development and Commercialization of more than 10 medicines. Dr. Yang is a member of the Expert Scientific Advisory Committee of Medicines for Malaria Venture, and the scientific advisory board of Sionna Therapeutics. Dr. Yang also serves on the Board of Directors of Kodiak Sciences and Brii Biosciences. Dr. Yang received her bachelor’s degree in chemistry from National Taiwan University and her Ph.D. in organic chemistry from the University of Southern California. Dr. Yang was elected a Fellow of the American Institute for Medical and Biological Engineering in 2021 and a member of the National Academy of Engineering in 2022. We believe Dr. Yang is qualified to serve on our Board due to her expertise and experience in the life sciences industry and her educational background. |
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Directors Continuing in Office Until the 2025 Annual Meeting
|
Roshawn Blunt Age: 48 |
Roshawn Blunt, 48, has served as a member of our Board since November 2021. Ms. Blunt has more than 25 years of experience in the biopharmaceutical and medical device industries. She is the president of Corsaire Corporation, a pharmaceutical commercialization organization. Previously, Ms. Blunt was the managing director of 1798, LLC, a pharmaceutical managed markets consulting firm, which she founded in 2010. She led 1798 until it was purchased by Fingerpaint Marketing, at which time she became a partner at the firm and the managing director of its consulting business line. She served on the board of directors of Adamis Pharmaceuticals, a public biotechnology company, from August 2019 to October 2021. From 2007 to 2010, Ms. Blunt was managing director of the Aequitas Group, a healthcare advisory firm, where she led the health economics and reimbursement consultancy. Prior to that, Ms. Blunt worked at Johnson & Johnson, a public pharmaceutical company, from 2005 to 2007, and from 2000 to 2005 she was part of the global government affairs organization at Amgen, Inc., a public biopharmaceutical company. Ms. Blunt received her B.A. from the Princeton School of Public and International Affairs. She earned her M.B.A. from the Kellogg School of Management at Northwestern University. We believe Ms. Blunt is qualified to serve on our Board due to her experience running a national health care consulting firm, the depth of her knowledge around reimbursement and patient access and her prior experience working in the biopharmaceutical industry. |
|
David M. Tanen Age: 51 |
David M. Tanen, 51, has served as a member of our board of directors since our inception in June 2017. Mr. Tanen is a co-founder of Two River, LLC, a life-science consulting and investment firm, and has served as a Partner since September 2004. He has served as an Advisor to Vida Ventures, a life science investment firm, since November 2018. Prior to founding Two River, Mr. Tanen served as General Counsel for a life science focused venture capital firm. Mr. Tanen is also a co-founder of Kite Pharma, Inc., where he served as Corporate Secretary and General Counsel from June 2009 until its acquisition by Gilead Sciences in 2017. He is a co-founder of Allogene Therapeutics and has served as its Corporate Secretary since its inception in December 2017. Mr. Tanen also served as an officer and director of Neogene Therapeutics, Inc. until its acquisition by AstraZeneca in January 2023. He is also an officer and director of 76Bio, Inc., a privately held life science company focused on developing treatments for cancer. Mr. Tanen received his B.A. from The George Washington University and his J.D. from Fordham University School of Law, where he has served on the Dean’s Planning Council since 2009. We believe Mr. Tanen is qualified to serve on our Board due to his experience serving as an officer and a member of the boards of directors of clinical-stage life sciences companies, and because of his investment experience in the life sciences industry. |
| Kronos Bio | 14 | 2023 Proxy Statement |
|
Katherine Vega Stultz Age: 50 |
Katherine Vega Stultz, 50, joined our board of directors in April 2023. Ms. Stultz is currently the Chief Executive Officer and President of Ocelot Bio., a private biotechnology company. Previously she served as the Chief Operating Officer at Graphite Bio, Inc. from August 2020 to December 2021, where she successfully advanced Graphite’s clinical development program and helped take the company public. As Graphite accelerated its efforts to enter the clinic with its lead investigational gene therapy candidate within its first year of launch, Ms. Stultz played a pivotal role in spearheading operational management. Previously, Ms. Stultz held various roles at Celgene Corporation (most recently as Senior Vice President of Project and Portfolio Leadership and General Management) from August 2005 to January 2020, during a period of exponential growth for the company and its products. Ms. Stultz began her career at Eli Lilly & Company (2000-2005) and ConvaTec, a Bristol-Myers Squibb Company (1995-2000), where she progressed through a series of product development, project management, sales and marketing positions. Ms. Stultz received her B.S. in Mechanical Engineering (Biomedical Applications) from Cornell University and has attended executive leadership development programs at the Darden School of Business, University of Virginia, IESE Business School in Barcelona, Spain, and the International Institute for Management Development (IMD) in Switzerland. Katherine has worked in commercialization and development covering oncology, hematology, inflammation, neuroscience and most recently hepatology. We believe Ms. Stultz is qualified to serve on our Board due to her experience and expertise in the life sciences industry, including her experience as a senior executive, and her educational background. |
| Kronos Bio | 15 | 2023 Proxy Statement |
Set forth below is biographical information for each of our executive officers other than Dr. Bischofberger, whose biographical information is set forth above.
|
Yasir Age: 41 |
Yasir Al-Wakeel, BM BCh, 41, has served as our Chief Financial Officer and Head of Corporate Development since August 2020. Prior to joining our company, Dr. Al-Wakeel served as the Chief Financial Officer of Neon Therapeutics, Inc. from July 2017 to May 2020. Previously, Dr. Al-Wakeel served as the Chief Financial Officer and Head of Corporate Development at Merrimack Pharmaceuticals, Inc. from August 2015 until July 2017. Prior to that, Dr. Al-Wakeel served in various capacities at Credit Suisse, an investment banking firm, from 2008 to 2015. While at Credit Suisse, Dr. Al-Wakeel was Director of Healthcare Investment Banking, focused on biotechnology, and, prior to that role, he was an Equity Research Analyst covering the biotechnology and specialty pharmaceuticals sectors. Before joining Credit Suisse, Dr. Al-Wakeel was a practicing physician, holding both clinical and academic medical posts. Dr. Al-Wakeel has served on the Maxcyte, Inc. Board of Directors since June 2021. Dr. Al-Wakeel received his BM BCh (Doctor of Medicine and Surgery) from Oxford University and his M.A. in theology from Cambridge University. | |
|
Jorge DiMartino, M.D., Ph.D. Age:
59 |
Jorge DiMartino, M.D., Ph.D., 59, has served as our Chief Medical Officer and Executive Vice President, Clinical Development since December 2019. Prior to joining us, Dr. DiMartino served as Vice President, Translational Development Oncology at Celgene Corp., a global biopharmaceutical company acquired by Bristol Myers Squibb, from July 2014 to December 2019, where he led early-stage oncology clinical programs and directed the Translational Research Laboratories. During that time, he also served as the Head of Celgene’s Epigenetics Thematic Center of Excellence, a fully integrated unit driving drug discovery through clinical proof of concept efforts around epigenetic targets. From April 2011 to July 2014, Dr. DiMartino served as Executive Director, Translational Development Oncology at Celgene. Prior to joining Celgene from December 2005 to April 2011, Dr. DiMartino was Group Medical Director at Genentech in the Oncology Exploratory Clinical Development group. Dr. DiMartino received his Ph.D. in Immunology from Cornell University Graduate School of Medical Sciences, and his M.D. from University of California San Diego. He completed a residency in Pediatrics and a fellowship in Pediatric Hematology/Oncology, both at Stanford University School of Medicine. |
| Kronos Bio | 16 | 2023 Proxy Statement |
|
Christopher Dinsmore, Ph.D. Age: 57 |
Christopher Dinsmore, Ph.D., 57, has served as our Chief Scientific Officer since June 2020. Prior to joining us, Dr. Dinsmore served as an Entrepreneur-in-Residence at Third Rock Ventures from June 2019 to June 2020, where he focused on discovering and launching new innovative therapeutic companies. Previously, he served as Vice President and Head of Chemistry at Forma Therapeutics, a biopharmaceutical company, from December 2013 to June 2019, where he applied an array of discovery chemistry platforms and approaches to target classes in epigenetics and protein homeostasis. Earlier, Dr. Dinsmore served at Merck Research Laboratories for 19 years, where he held various positions in medicinal chemistry. His project experiences in discovery and development have been in therapeutic categories that include cancer, hematology, sickle cell disease, neurodegeneration, asthma, and rheumatoid arthritis, leading to the advancement of numerous development compounds into clinical trials. Dr. Dinsmore also serves on the scientific advisory board for Stablix, Inc. and on the advisory board for WARF Therapeutics. Dr. Dinsmore received his B.A. in Chemistry and Art from Bowdoin College and his Ph.D. in Synthetic Organic Chemistry from the University of Minnesota in Minneapolis, and then conducted postdoctoral research in chemical synthesis at Harvard University. |
|
Barbara Kosacz Age:
65 |
Barbara Kosacz, 65, has served as our Chief Operating Officer and General Counsel since July 2020. Prior to joining us, Ms. Kosacz was a Partner at Cooley, LLP, from January 1997 to December 2000, and again from February 2002 until July 2020, where she led the International Life Sciences practice. Ms. Kosacz has more than 25 years of experience in counseling clients in the life sciences arena, ranging from early-stage startups to larger public companies, venture funds, investment banks, and non-profit institutions. She has served as a member of the BIO Emerging Companies’ Section Governing Board, is a member of the Board of Trustees of the Keck Graduate Institute and has been a speaker at multiple life sciences-related conferences, as well as a guest lecturer at the University of California, Berkeley, Columbia University, University of Pennsylvania and Stanford University about biotechnology law, biotech business models, corporate partnering negotiations and deal structures, and bioethics. Recognized by Best Lawyers in America since 2008 and most recently as Biotechnology Lawyer of the Year in 2018, Ms. Kosacz was listed as a “leading lawyer” for healthcare and life sciences in the 2018 Legal 500, as a “Band 1” attorney in the 2018 edition of Chambers USA: America’s Leading Lawyers for Business and recognized as a “highly recommended transactions” lawyer by IAM Patent 1000 for her “nearly three decades advising diverse companies in the industry at a deeply strategic and commercial level and overseeing their most complex and profitable deals.” Ms. Kosacz is a member of the Board of Directors of XOMA Corp., a biotechnology royalty aggregator company, Athira Pharma, a clinical-stage company focused on developing therapies for neurodegenerative diseases, and of Phoenix Biotech Acquisition Corp., a blank check company formed for the purpose of acquiring or merging with one or more businesses. Ms. Kosacz received her B.A. from Stanford University and her J.D. from the University of California, Berkeley School of Law. |
| Kronos Bio | 17 | 2023 Proxy Statement |
Information Regarding the Board of Directors and Corporate Governance
Independence of the Board of Directors
As required under the Nasdaq Stock Market (“Nasdaq”) listing standards, a majority of the members of a listed company’s board of directors must qualify as “independent,” as affirmatively determined by its board of directors. The Board consults with the Company’s counsel to ensure that the Board’s determinations are consistent with relevant securities and other laws and regulations regarding the definition of “independent,” including those set forth in pertinent listing standards of Nasdaq, as in effect from time to time.
Consistent with these considerations, after review of all relevant identified transactions or relationships between each director, or any of his or her family members, and the Company, its senior management and its independent registered public accounting firm, the Board has affirmatively determined that all of our directors other than Dr. Bischofberger, Mr. Kazam and Mr. Tanen are independent directors, as defined by Rule 5605(a)(2) of the Nasdaq Listing Rules.
Our Board is currently chaired by Dr. Belldegrun, who has authority, among other things, to call and preside over Board meetings, set meeting agendas and determine materials to be distributed to the Board. Accordingly, the chairman has substantial ability to shape the work of the Board. We believe that separation of the positions of chairman and chief executive officer reinforces the independence of the Board in its oversight of our business and affairs. In addition, we have a separate chair for each committee of our Board. The chairs of each committee are expected to report periodically to our Board on the activities of their committees in fulfilling the responsibilities as detailed in the respective charters or advise of any shortcomings should that be the case.
| Kronos Bio | 18 | 2023 Proxy Statement |
Expertise and Experience: Our Board is responsible for overseeing our business consistent with its fiduciary duties. This significant responsibility requires highly skilled individuals with various qualities, attributes and professional experience. We believe the Board is well-rounded, with a balance of relevant perspectives and experience, as illustrated in the following chart:
| Kronos Bio | 19 | 2023 Proxy Statement |
Diversity: We strive to achieve diversity in the broadest sense, including people diverse in gender, ethnicity, age, and experiences as well as from diverse geographies. The overall diversity of the Board is an important consideration in the director selection and nomination process. The Nominating and Corporate Governance Committee assesses diversity (including self-identified diversity characteristics) in connection with the annual nomination process as well as in new director searches. Our ten directors range in age from 43 to 73 and our Board includes five women and four individuals from underrepresented communities.
The Board Diversity Matrix, below, provides the diversity statistics for our Board of Directors.
| Board Diversity Matrix (As of April 25, 2023) | ||||
| Total Number of Directors | 10 | |||
| Female | Male | Non-Binary | Did Not Disclose Gender | |
| Part I: Gender Identity | ||||
| Directors | 5 | 5 | 0 | 0 |
| Part II: Demographic Background | ||||
| African American or Black | 1 | 0 | 0 | 0 |
| Alaskan Native or Native American | 0 | 0 | 0 | 0 |
| Asian | 1 | 0 | 0 | 0 |
| Hispanic or Latinx | 1 | 0 | 0 | 0 |
| Native Hawaiian or Pacific Islander | 0 | 0 | 0 | 0 |
| White | 2 | 4 | 0 | 0 |
| Two or More Races or Ethnicities | 0 | 1 | 0 | 0 |
| LGBTQ+ | 0 | |||
| Did Not Disclose Demographic Background | 0 | |||
Role of the Board in Risk Oversight
One of the key functions of our Board of Directors is informed oversight of our risk management process. The Board does not have a standing risk management committee, but rather administers this oversight function directly through the Board as a whole, as well as through the Audit Committee. The Audit Committee receives reports from management periodically regarding our assessment of risks, including cybersecurity risks. In addition, the Audit Committee reports regularly to our Board, which also considers our risk profile. The Audit Committee and our Board focus on the most significant risks we face and our general risk management strategies. While our Board oversees risk management, management is responsible for day-to-day risk management processes. Our Board expects management to consider risk and risk management in each business decision, to proactively develop and monitor risk management strategies and processes for day-to-day activities, and to effectively implement risk management strategies adopted by the Audit Committee and our Board. We believe this division of responsibilities is the most effective approach for addressing the risks we face and that our Board’s leadership structure, which also emphasizes the independence of our Board in its oversight of its business and affairs, supports this approach.
| Kronos Bio | 20 | 2023 Proxy Statement |
Meetings of the Board of Directors
Our Board of Directors met five times during the last fiscal year. Each Board member attended at least 75% of the meetings of the Board and of the committees on which he or she served.
Information Regarding Committees of the Board of Directors
The Board maintains an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee. The following table provides membership and meeting information for 2022 for each of the following Board committees:
| Name | Audit | Compensation | Nominating and |
| Arie Belldegrun, M.D., FACS | ● | ● | |
| Roshawn Blunt | ● | ||
| Marianne De Backer, Ph.D. | ● | ● | |
| Joshua Kazam | |||
| Elena Ridloff, CFA | ● | ||
| David M. Tanen | |||
| Taiyin Yang, Ph.D. | ● | ● | |
| Total meetings in 2022 | 4 | 5 | 3 |
● Committee Chairperson ● Committee Member
The Board has determined that each member of each committee meets the applicable Nasdaq rules and regulations regarding “independence” and each member is free of any relationship that would impair his or her individual exercise of independent judgment with regard to the Company.
Our Audit Committee currently consists of Elena Ridloff, CFA, Marianne De Backer, Ph.D., and Taiyin Yang, Ph.D. Our Board has determined that each of the members of our Audit Committee satisfies the Nasdaq Stock Market and SEC independence requirements. Ms. Ridloff serves as the chair of our Audit Committee. The Board has adopted a written Audit Committee charter that is available to stockholders on the Company’s website at www.kronosbio.com.
| Kronos Bio | 21 | 2023 Proxy Statement |
The functions of this committee include, among other things:
| ● | evaluating the performance, independence and qualifications of our independent auditors and determining whether to retain our existing independent auditors or engage new independent auditors; | |
| ● | reviewing and approving the engagement of our independent auditors to perform audit services and any permissible non-audit services; | |
| ● | monitoring the rotation of partners of our independent auditors on our engagement team as required by law; | |
| ● | prior to engagement of any independent auditor, and at least annually thereafter, reviewing relationships that may reasonably be thought to bear on their independence, and assessing and otherwise taking the appropriate action to oversee the independence of our independent auditor; | |
| ● | reviewing our annual and quarterly financial statements and reports, including the disclosures contained under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and discussing the statements and reports with our independent auditors and management; | |
| ● | reviewing, with our independent auditors and management, significant issues that arise regarding accounting principles and financial statement presentation and matters concerning the scope, adequacy and effectiveness of our financial controls; | |
| ● | reviewing with management and our independent auditors any earnings announcements and other public announcements regarding material developments; | |
| ● | establishing procedures for the receipt, retention and treatment of complaints received by us regarding financial controls, accounting or auditing matters and other matters; | |
| ● | preparing the report that the SEC requires in our annual proxy statement; | |
| ● | reviewing and providing oversight of any related-person transactions in accordance with our related person transaction policy and reviewing and monitoring compliance with legal and regulatory responsibilities, including our code of business conduct and ethics; | |
| ● | reviewing our major financial risk exposures, including the guidelines and policies to govern the processes by which risk assessment and risk management are implemented; | |
| ● | reviewing on a periodic basis our investment policy; and | |
| ● | reviewing and evaluating on an annual basis the performance of the Audit Committee and the Audit Committee charter. |
Our Board has determined that Ms. Ridloff qualifies as an audit committee financial expert within the meaning of SEC regulations and meets the financial sophistication requirements of the Nasdaq Listing Rules. In making this determination, our Board has considered Ms. Ridloff’s prior experience, business acumen and independence. Both our independent registered public accounting firm and management periodically meet privately with our Audit Committee.
We believe that the composition and functioning of our Audit Committee comply with all applicable requirements of the Sarbanes-Oxley Act, and all applicable SEC and Nasdaq rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.
| Kronos Bio | 22 | 2023 Proxy Statement |
Report of the Audit Committee of the Board of Directors
The Audit Committee has reviewed and discussed the audited financial statements for the fiscal year ended December 31, 2022 with management of the Company. The Audit Committee has discussed with the independent registered public accounting firm the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight board (“PCAOB”) and the SEC. The Audit Committee has also received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent accountants’ communications with the Audit Committee concerning independence and has discussed with the independent registered public accounting firm the accounting firm’s independence. Based on the foregoing, the Audit Committee has recommended to the Board of Directors that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022.
Ms. Ridloff (Chair)
Dr. De Backer
Dr. Yang
* The material in this report is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference in any filing of the Company under the Exchange Act or the Securities Act of 1933, as amended (the “Securities Act”), whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
Our Compensation Committee currently consists of
Arie Belldegrun, M.D., FACS, Marianne De Backer, Ph.D., and Roshawn Blunt.
Dr. Belldegrun serves as the chair of our Compensation Committee. Our Board of Directors has determined that each of the members of our
Compensation Committee satisfies the Nasdaq Stock Market independence requirements. The Board has adopted a written Compensation Committee
charter that is available to stockholders on the Company’s website at www.kronosbio.com. The functions of this committee include,
among other things:
| ● | reviewing, modifying and approving (or if it deems appropriate, making recommendations to the full Board of Directors regarding) our overall compensation strategy and policies; | |
| ● | reviewing and approving (or if it deems appropriate, making recommendations to the full Board of Directors regarding) the compensation and other terms of employment of our executive officers; | |
| ● | reviewing and approving (or if it deems it appropriate, making recommendations to the full Board of Directors regarding) performance goals and objectives relevant to the compensation of our executive officers and assessing their performance against these goals and objectives; | |
| ● | reviewing and approving (or if it deems it appropriate, making recommendations to the full Board of Directors regarding) the equity incentive plans, compensation plans and similar programs advisable for us, as well as modifying, amending or terminating existing plans and programs; | |
| ● | evaluating risks associated with our compensation policies and practices and assessing whether risks arising from our compensation policies and practices for our employees are reasonably likely to have a material adverse effect on us; | |
| ● | reviewing and making recommendations to the full Board of Directors regarding the type and amount of compensation to be paid or awarded to our non-employee Board members; | |
| ● | establishing policies with respect to votes by our stockholders to approve executive compensation as required by Section 14A of the Exchange Act and determining our recommendations regarding the frequency of advisory votes on executive compensation, to the extent required by law; |
| Kronos Bio | 23 | 2023 Proxy Statement |
| ● | reviewing and assessing the independence of compensation consultants, legal counsel and other advisors as required by Section 10C of the Exchange Act; | |
| ● | administering our equity incentive plans; | |
| ● | establishing policies with respect to equity compensation arrangements; | |
| ● | reviewing the competitiveness of our executive compensation programs and evaluating the effectiveness of our compensation policy and strategy in achieving expected benefits to us; | |
| ● | reviewing and making recommendations to the full Board of Directors regarding the terms of any employment agreements, severance arrangements, change in control protections and any other compensatory arrangements for our executive officers; | |
| ● | reviewing with management and approving our disclosures under the caption “Compensation Discussion and Analysis” in our periodic reports or proxy statements to be filed with the SEC, to the extent such caption is included in any such report or proxy statement; | |
| ● | preparing the report that the SEC requires in our annual proxy statement (if applicable); and | |
| ● | reviewing and assessing on an annual basis the performance of the Compensation Committee and the Compensation Committee charter. |
We believe that the composition and functioning of our Compensation Committee comply with all applicable requirements of the Sarbanes-Oxley Act, and all applicable SEC and Nasdaq rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.
Nominating and Corporate Governance Committee
Our Nominating and Corporate Governance Committee currently consists of Taiyin Yang, Ph.D and Arie Belldegrun, M.D. FACS. Our Board has determined that each of the members of this committee satisfies the Nasdaq Stock Market independence requirements. Dr. Yang serves as the chair of our Nominating and Corporate Governance Committee. The Board has adopted a written Nominating and Corporate Governance Committee charter that is available to stockholders on the Company’s website at www.kronosbio.com. The functions of this committee include, among other things:
| ● | identifying, reviewing and evaluating candidates to serve on our Board of Directors consistent with criteria approved by our Board; | |
| ● | determining the minimum qualifications for service on our Board; | |
| ● | evaluating director performance on the Board and applicable committees of the Board and determining whether continued service on our Board is appropriate; | |
| ● | evaluating, nominating and recommending individuals for membership on our Board; | |
| ● | evaluating nominations by stockholders of candidates for election to our Board; | |
| ● | considering and assessing the independence of members of our Board; | |
| ● | developing a set of corporate governance policies and principles, including a code of business conduct and ethics, periodically reviewing and assessing these policies and principles and their application and recommending to our Board any changes to such policies and principles; |
| Kronos Bio | 24 | 2023 Proxy Statement |
| ● | considering questions of possible conflicts of interest of directors as such questions arise; and | |
| ● | reviewing and assessing on an annual basis the performance of the Nominating and Corporate Governance Committee and the Nominating and Corporate Governance Committee charter. |
We believe that the composition and functioning of our Nominating and Corporate Governance Committee comply with all applicable requirements of the Sarbanes-Oxley Act, and all applicable SEC and Nasdaq rules and regulations. We intend to comply with future requirements to the extent they become applicable to us.
The Nominating and Corporate Governance Committee believes that the candidates for director, both individually and collectively, have the integrity, experience, judgment, commitment (including having sufficient time to devote to us and level of participation), skills and expertise appropriate for us. In assessing the directors, both individually and collectively, the Nominating and Corporate Governance Committee considers our current needs, and the needs of the Board of Directors, to maintain a balance of knowledge, experience, capability, race, gender, geographical representation, thought, viewpoints, backgrounds, skills, and expertise. However, the Nominating and Corporate Governance Committee retains the right to modify these qualifications from time to time.
The Nominating and Corporate Governance Committee uses its network of contacts to compile a list of potential candidates, but may also engage, if it deems appropriate, a professional search firm. Candidates for director nominees are reviewed in the context of the current composition of the Board of Directors, our operating requirements and the long-term interests of stockholders. In conducting this assessment, the Nominating and Corporate Governance Committee typically considers diversity (including with respect to race, gender, geography, thought, viewpoints, and backgrounds), age, skills and such other factors as it deems appropriate given our current needs and the needs of the Board of Directors, to maintain a balance of knowledge, experience and capability, especially in light of the existing composition of the Board and in light of the stage of the Company. In the case of incumbent directors whose terms of office are set to expire, the Nominating and Corporate Governance Committee reviews these directors’ overall service to us during their terms, including the number of meetings attended, level of participation, quality of performance and any other relationships and transactions that might impair the directors’ independence. In the case of new director candidates, the Nominating and Corporate Governance Committee also determines whether the nominee is independent for Nasdaq purposes, which determination is based upon applicable Nasdaq listing standards, applicable SEC rules and regulations and the advice of counsel, if necessary. To the extent any search firm is retained to assist the Nominating and Corporate Governance Committee in seeking candidates for the Board, the search firm will be instructed to seek to include diverse candidates in terms of race, gender, geography, thought, viewpoints, backgrounds, skills, experience, and expertise from, among other areas, professional and academic areas relevant to the Company’s area of focus. In addition, the Nominating and Corporate Governance Committee conducts any appropriate and necessary inquiries into the backgrounds and qualifications of possible candidates after considering the function and needs of the Board of Directors. The Nominating and Corporate Governance Committee meets to discuss and consider the candidates’ qualifications and then selects a nominee for recommendation to the Board of Directors by majority vote.
The Nominating and Corporate Governance Committee will consider director candidates recommended by stockholders. The Nominating and Corporate Governance Committee does not intend to alter the manner in which it evaluates candidates, including the minimum criteria set forth above, based on whether or not the candidate was recommended by a stockholder. Stockholders who wish to recommend individuals for consideration by the Nominating and Corporate Governance Committee to become nominees for election to the Board of Directors may do so by delivering a written recommendation to the Nominating and Corporate Governance Committee at the following address: 1300 So. El Camino Real, Suite 400, San Mateo, California 94402, Attn: Secretary, no later than the 90th day and no earlier than the 120th day prior to the one year anniversary of the preceding year’s Annual Meeting. Submissions must include, among other things, (1) the name and address of the stockholder on whose behalf the submission is made; (2) number of our shares that are owned beneficially by such stockholder as of the date of the submission; (3) the full name of the proposed candidate; (4) description of the proposed candidate’s business experience for at least the previous five years;
| Kronos Bio | 25 | 2023 Proxy Statement |
(5) complete biographical information for the proposed candidate; (6) a description of the proposed candidate’s qualifications as a director and (7) any other information required by our Amended and Restated Bylaws. We may require any proposed nominee to furnish such other information as we may reasonably require to determine the eligibility of such proposed nominee to serve as our independent director or that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of such proposed nominee.
Stockholder Communications with The Board of Directors
The Board has adopted a formal process by which stockholders may communicate with the Board or any of its directors. Stockholders who wish to communicate with the Board may do so by sending written communications addressed to: Kronos Bio, Inc., Attn: Secretary, 1300 So. El Camino Real, Suite 400, San Mateo, California 94402. These communications will be reviewed by the Secretary, who will determine whether the communication is appropriate for presentation to the Board or the relevant director. The purpose of this screening is to allow the Board to avoid having to consider irrelevant or inappropriate communications (such as advertisements, solicitations and hostile communications).
The Company has adopted the Code of Business Conduct and Ethics that applies to all officers, directors and employees. The Code of Business Conduct and Ethics is available on the Company’s website at www.kronosbio.com. The Nominating and Corporate Governance Committee of our Board of Directors is responsible for overseeing our Code of Business Conduct and Ethics and any waivers applicable to any director, executive officer or employee. If the Company makes any substantive amendments to the Code of Business Conduct and Ethics or grants any waiver from a provision of the Code to any executive officer or director, the Company will promptly disclose the nature of the amendment or waiver on its website.
| Kronos Bio | 26 | 2023 Proxy Statement |
Proposal 2
Advisory Vote on Executive Compensation
At our 2022 Annual Meeting of Stockholders, the stockholders indicated their preference that we solicit a non-binding advisory vote on the compensation of our named executive officers, commonly referred to as a “say-on-pay” vote, every year. The Board has adopted a policy that is consistent with that preference. In accordance with that policy, this year, we are asking the stockholders to approve, on an advisory basis, the compensation of our named executive officers as disclosed in this proxy statement in accordance with SEC rules.
This vote is not intended to address any specific item of compensation, but rather the overall compensation of the Company’s named executive officers and the philosophy, policies and practices described in this proxy statement. The compensation of the Company’s named executive officers subject to the vote is disclosed in the Compensation Discussion and Analysis, the compensation tables, and the related narrative disclosure contained in this proxy statement. As discussed in those disclosures, we believe that our compensation policies and decisions are performance driven and foster a performance-oriented culture, are strongly aligned with our stockholders interests and are consistent with current market practices. Compensation of the Company’s named executive officers is designed to enable the Company to attract and retain talented and experienced executives to lead the Company successfully in a competitive environment.
Accordingly, the Board is asking the stockholders to indicate their support for the compensation of the Company’s named executive officers as described in this proxy statement by casting a non-binding advisory vote “For” the following resolution:
“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the compensation tables and narrative discussion, is hereby APPROVED.”
Because the vote is advisory, it is not binding on the Board or the Company. Nevertheless, the views expressed by the stockholders, whether through this vote or otherwise, are important to management and the Board and, accordingly, the Board and the Compensation Committee intend to consider the results of this vote in making determinations in the future regarding executive compensation arrangements.
Advisory approval of this proposal requires the vote of the holders of a majority of the shares present at the Annual Meeting or represented by proxy and entitled to vote on the matter at the Annual Meeting. Unless the Board decides to modify its policy regarding the frequency of soliciting advisory votes on the compensation of the Company’s named executive officers, the next scheduled say-on-pay vote will be at the 2024 Annual Meeting of Stockholders.
Vote
The Board
of Directors
Recommends
a
Vote “For”
Proposal 2.
| Kronos Bio | 27 | 2023 Proxy Statement |
The Audit Committee of the Board has selected Ernst & Young LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2023 and has further directed that management submit the selection of its independent registered public accounting firm for ratification by the stockholders at the Annual Meeting. Ernst & Young LLP has audited the Company’s financial statements since 2019. Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting. They will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.
Neither the Company’s Bylaws nor other governing documents or law require stockholder ratification of the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm. However, the Audit Committee of the Board is submitting the selection of Ernst & Young LLP to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee of the Board will reconsider whether or not to retain that firm. Even if the selection is ratified, the Audit Committee of the Board in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if they determine that such a change would be in the best interests of the Company and its stockholders.
The affirmative vote of the holders of a majority of the shares present at the Annual Meeting or represented by proxy and entitled to vote on the matter at the Annual Meeting will be required to ratify the selection of accounting firm.
Vote
The Board of Directors Recommends a Vote “For” Proposal 3.
| Kronos Bio | 28 | 2023 Proxy Statement |
Principal Accountant Fees and Services
The following table represents aggregate fees billed to the Company for the fiscal years ended December 31, 2021 and December 31, 2022 by Ernst & Young LLP, the Company’s principal accountant.
| Fiscal Year Ended | |||||
| 2022 | 2021 | ||||
| (in thousands) | |||||
| Fee Category | |||||
| Audit fees(1) | $1,089 | $1,454 | |||
| Audit-related fees | — | — | |||
| Tax fees(2) | 6 | — | |||
| All other fees | — | — | |||
| Total fees | $1,095 | $1,454 | |||
| (1) | Audit Fees consist of fees for professional services provided in connection with the audit of our annual financial statements, the review of our quarterly financial statements, and services that are normally provided by independent registered public accounting firms in connection with regulatory filings. |
| (2) | Tax fees include fees for tax advice. |
All fees described above were pre-approved by the Audit Committee.
Pre-Approval Policies and Procedures
Pursuant to its charter, the Audit Committee must review and approve, in advance, the scope and plans for the audits and the audit fees and approve in advance (or, where permitted under the rules and regulations of the SEC, subsequently) all non-audit services to be performed by the independent registered public accounting firm that are not otherwise prohibited by law and any associated fees. The Audit Committee may delegate to one or more members of the committee the authority to pre-approve audit and permissible non-audit services, as long as this pre-approval is presented to the full committee at scheduled meetings.
| Kronos Bio | 29 | 2023 Proxy Statement |
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding the ownership of the Company’s common stock as of March 31, 2023 by: (i) each director; (ii) each of the Company’s named executive officers; (iii) all executive officers and directors of the Company as a group; and (iv) all those known by the Company to be beneficial owners of more than 5% of its common stock.
The table is based upon information supplied by officers, directors and principal stockholders, and found in Schedules 13D and 13G filed with the SEC and other sources believed to be reliable by the Company. Unless otherwise indicated in the footnotes to this table and subject to community property laws where applicable, the Company believes that each of the stockholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned. Applicable percentages are based on 57,630,109 shares outstanding on March 31, 2023, adjusted as required by rules promulgated by the SEC. The number of shares of common stock used to calculate the percentage ownership of each listed beneficial owner includes the shares of common stock underlying options or convertible securities held by such beneficial owner that are exercisable or convertible within 60 days following March 31, 2023. Unless otherwise indicated, the address for each person or entity listed in the table is c/o Kronos Bio, Inc., 1300 So. El Camino Real, Suite 400, San Mateo, California 94402.
| Greater than 5% Stockholders | Number of shares beneficially owned |
Percentage Beneficially Owned |
| Bischofberger Trust(1) | 4,370,494 | 7.6% |
| BlackRock, Inc.(2) | 3,206,885 | 5.6% |
| Omega Fund V, L.P.(3) | 3,818,283 | 6.6% |
| Named Executive Officers and Directors: | ||
| Norbert W. Bischofberger, Ph.D.(4) | 6,473,610 | 11.2% |
| Jorge DiMartino, M.D., Ph.D.(5) | 557,356 | * |
| Yasir Al-Wakeel, BM BCh(6) | 643,152 | 1.1% |
| Arie S. Belldegrun, M.D., FACS(7) | 3,465,489 | 6.0% |
| David M. Tanen(8) | 1,009,114 | 1.7% |
| Elena Ridloff, CFA(9) | 63,505 | * |
| Joshua Kazam(10) | 387,103 | * |
| Katherine Stultz | – | * |
| Roger Dansey | – | * |
| Roshawn Blunt(11) | 13,734 | * |
| Taiyin Yang(12) | 32,617 | * |
| All current executive officers and directors as a group (13 persons)(13) | 13,871,967 | 23.4% |
| * | Represents beneficial ownership of less than 1%. |
| (1) | Consists of 4,370,494 shares of common stock held by the Norbert W. & Inger A. Bischofberger Revocable Inter Vivos Trust, dtd August 29, 1994 (Bischofberger Revocable Trust), of which 97,228 shares are subject to a right of repurchase by us as of May 30, 2023. Dr. Bischofberger is a co-trustee of the Bischofberger Revocable Trust. The address of the Bischofberger Dynasty Trusts is Pillsbury Winthrop, Four Embarcadero Center, 22nd Floor, San Francisco, CA 94111, Attn: Timothy Burgh. |
| (2) | Consists of 3,206,885 shares of common stock held by BlackRock, Inc. The address of BlackRock, Inc., is 55 East 52nd Street, New York, NY 10055. This information is based on the Schedule 13G filed on February 1, 2023. |
| (3) | Consists of 3,818,283 shares of common stock held by Omega Fund V, L.P. (“Omega Fund”). Omega Ltd serves as the general partner of Omega GP, which serves as the general partner of Omega Fund. Dr. Stampecchia is a director of Omega Ltd and may therefore be deemed to be the beneficial owner of the shares of common stock held by Omega. The address of Omega Manager is 888 Boylston St, Boston, MA 02199. |
| Kronos Bio | 30 | 2023 Proxy Statement |
| (4) | Consists of (i) the shares described in note (1) above of 4,370,494, (ii) 743,567 shares of common stock owned, (iii) 304,549 shares issuable pursuant to options exercisable within 60 days of March 31, 2023 and (iv) 263,750 shares of common stock held by each of (a) Norbert W. Bischofberger and Inger A. Bischofberger, Trustees of the Irene Alisha Bischofberger Dynasty GST Exempt Trust dated April 29, 2020, (b) Norbert W. Bischofberger and Inger A. Bischofberger, Trustees of The Irene Alisha Bischofberger Dynasty GST Non-Exempt Trust dated April 29, 2020, (c) Norbert W. Bischofberger and Inger A. Bischofberger, Trustees of The David Michael Anthony Dynasty GST Exempt Trust dated April 29, 2020, and (d) Norbert W. Bischofberger and Inger A. Bischofberger, Trustees of the Dave Michael Anthony Dynasty GST Non-Exempt Trust dated April 29, 2020 (collectively, the Bischofberger Dynasty Trusts). Dr. Bischofberger is co-trustee of the Bischofberger Dynasty Trusts and may therefore be deemed to be the beneficial owner of the common shares held by the Bischofberger Dynasty Trusts. The address of the Bischofberger Dynasty Trusts is Pillsbury Winthrop, Four Embarcadero Center, 22nd Floor, San Francisco, CA 94111, Attn: Timothy Burgh. |
| (5) | Consists of (i) 83,439 shares of common stock owned by Dr. DiMartino and (ii) 473,917 shares of common stock that Dr. DiMartino has the right to acquire from us within 60 days of March 31, 2023 pursuant to the exercise of stock options. |
| (6) | Consists of (i) 109,739 shares of common stock owned by Dr. Al-Wakeel and (ii) 533,413 shares of common stock that Dr. Al-Wakeel has the right to acquire from us within 60 days of March 31, 2023 pursuant to the exercise of stock options. |
| (7) | Consists of (i) 2,765,314 shares of common stock held by Vida Ventures, LLC, of which VV Manager LLC is the manager, of which Dr. Belldegrun is a Senior Managing Director, and (ii) 679,575 shares of common stock held by Bellco, of which Dr. Belldegrun is a trustee, and (iii) 20,600 shares issuable pursuant to options exercisable within 60 days of March 31, 2023. The address of Vida Ventures LLC is 40 Broad Street, Suite 201, Boston, MA 02109. The address of Bellco is 2049 Century Park E., Suite 1940, Los Angeles, CA 90067. |
| (8) | Consists of (i) 363,428 shares of common stock held by David M. Tanen, (ii) 471,230 shares of common stock held by the David Tanen Revocable Grantor Trust, (iii) 79,125 shares of common stock held by Mr. Tanen’s minor children, and (iv) 95,331 shares of common stock that Mr. Tanen has the right to acquire from us within 60 days from March 31, 2023 pursuant to the exercise of stock options. |
| (9) | Consists of (i) 2,630 shares of common stock held by Elena Ridloff and (ii) 60,875 shares of common stock that Ms. Ridloff has the right to acquire from us within 60 days of March 31, 2023 pursuant to the exercise of stock options. |
| (10) | Consists of (i) 25,666 shares of common stock held by Joshua A. Kazam, (ii) 20,600 shares issuable pursuant to options exercisable within 60 days of March 31, 2023, (iii) 68,115 shares of common stock held jointly by Mr. Kazam and his wife, (iv) 136,011 held by Mr. Kazam as Trustee of Julia Chang 2018 IPR Trust, and (v) 136,011 held by Mr. Kazam as Trustee of the Robert Chang 2018 IPR Trust. |
| (11) | Consists of 13,734 shares of common stock that Roshawn Blunt has the right to acquire from us within 60 days of March 31, 2023 pursuant to the exercise of stock options. |
| (12) | Consists of 32,617 shares of common stock that Taiyin Yang has the right to acquire from us within 60 days of March 31, 2023 pursuant to the exercise of stock options. |
| (13) | Consists of the shares described in notes 4 through 12 above. It also includes two executives not listed in the table who hold an aggregate of (i) 1,226,287 shares of common stock and (ii) 497,277 shares of common stock that such executives have the right to acquire from us within 60 days of March 31, 2023, pursuant to the exercise of stock options. |
| Kronos Bio | 31 | 2023 Proxy Statement |
Overview—Our Compensation Committee is primarily responsible for establishing and reviewing our general compensation strategy. See the section captioned “Compensation Committee.”
Our named executive officers for the year ended December 31, 2022, consisting of our current principal executive officer and our two other most highly compensated executive officers, are:
| ● | Norbert Bischofberger, Ph.D., President and Chief Executive Officer; |
| ● | Jorge DiMartino, M.D., Ph.D., Chief Medical Officer and Executive Vice President, Clinical Development; and |
| ● | Yasir Al-Wakeel, BM, BCh., Chief Financial Officer and Head of Corporate Development. |
2022 Summary Compensation Table
The following table sets forth all of the compensation awarded to, earned by or paid to our named executive officers during the fiscal year ended December 31, 2022, and the fiscal year ended December 31, 2021.
| Name and Principal Position |
Year | Salary ($) |
Bonus [$] |
Stock Awards [$][1] |
Option Awards |
Non-Equity Incentive
Plan Compensation [$][3] |
All Other Compensation [$][4] |
Total [$] | ||||||||
| Norbert Bischofberger, Ph.D. President and Chief Executive Officer(5) |
2022 | 580,000 | – | – | 1,986,960 | 217,500 | (7) | 12,200 | 2,796,660 | |||||||
| 2021 | 320,000 | 40,875 | – | – | 272,500 | 11,600 | 644,975 | |||||||||
| Jorge DiMartino, M.D., Ph.D. Chief Medical Officer and Executive Vice President, Clinical Development |
2022 | 455,000 | – | 729,630 | 434,052 | 136,500 | 2,185 | 1,757,367 | ||||||||
| 2021 | 437,000 | 26,220 | – | – | 174,800 | 2,185 | 640,205 | |||||||||
| Yasir Al-Wakeel, BM BCh Chief Financial Officer and Head of Corporate Development |
2022 | 425,000 | – | 648,560 | 520,112 | 127,500 | 12,200 | 1,733,372 | ||||||||
| 2021 | 400,000 | 24,000 | – | – | 160,000 | 205,295 | (6) | 789,295 |
| (1) | The dollar amounts reported in this column reflect the aggregate grant date fair value of restricted stock units granted during each year based on the closing market price of the Company’s common stock on the date of grant. |
| (2) | In accordance with SEC rules, this column reflects the aggregate grant date fair value of the awards computed in accordance with Financial Accounting Standard Board Accounting Standards Codification Topic 718 for stock-based compensation transactions (“ASC 718”). Assumptions used in the calculation of these amounts are included in Note 9 to our financial statements in our Annual Report on Form 10-K for the year ended December 31, 2022. These amounts do not reflect the actual economic value that will be realized by our named executive officers upon the vesting, exercise, or sale of the shares of common stock underlying such awards. |
| (3) | The dollar amounts in this column represent the portion of the annual performance-based bonuses attributable to the corporate goals achieved in each year. For more information, see section titled “Annual Bonus Opportunity.” |
| (4) | Except as expressly noted below, all other compensation consists of 401(k) employer matching contributions. |
| Kronos Bio | 32 | 2023 Proxy Statement |
| (5) | In December 2020, the Board approved an increase to Dr. Bischofberger’s salary for 2021 to $545,000 from $450,000, of which $320,000 was to be paid in cash because the remaining $225,000 of his 2021 base salary had been paid in the form of stock options granted in 2020. For 2022, Dr. Bischofberger’s salary was paid only in cash. |
| (6) | Consists of $11,600 in 401(k) employer matching contributions, $90,182 in relocation assistance and $103,512 tax gross-up on relocation assistance. |
| (7) | The dollar amount reflects the amount Dr. Bischofberger earned under our 2022 annual cash bonus plan for 2022. Dr. Bischofberger voluntarily elected to forgo the entirety of, and did not receive, such bonus amount. |
Agreements with our Named Executive Officers
We have entered into a letter agreement with each of our named executive officers. The agreements generally provide for at-will employment and set forth the executive officer’s initial base salary, annual performance bonus opportunity, initial equity grant amount and eligibility for employee benefits. In addition, each of our named executive officers has executed a form of our standard proprietary information and invention assignment agreement. The key terms of the letter agreements are described below.
Norbert Bischofberger, Ph.D. We entered into a letter agreement with Dr. Bischofberger, our President and Chief Executive Officer, in May 2018 that, as amended, that governs the general terms of his employment with us. Pursuant to the agreement, Dr. Bischofberger receives an annual base salary, is eligible to receive an annual target performance bonus of up to 55% of his annual base salary as determined by our Board of Directors, and is entitled to receive severance benefits upon an involuntary termination of his employment with us, as described in more detail below under the subsection titled “—Potential Payments and Benefits upon Termination or Change in Control.” Effective as of February 2023, Dr. Bischofberger’s base salary remained at $580,000.
Jorge DiMartino, M.D., Ph.D. We entered into a letter agreement with Dr. DiMartino, our Chief Medical Officer and Executive Vice President, Clinical Development, in September 2019 that governs the general terms of his employment with us. Pursuant to the agreement, Dr. DiMartino receives an annual base salary, is eligible to receive an annual target performance bonus of up to 40% of his annual base salary as determined by our Board of Directors, and is eligible for severance benefits upon an involuntary termination of his employment with us, as described in more detail below under the subsection titled “—Potential Payments and Benefits upon Termination or Change in Control.” Effective as of February 2023, Dr. DiMartino’s base salary was increased from $455,000 to $475,000.
Yasir Al-Wakeel, BM BCh. We entered into a letter agreement with Dr. Al-Wakeel, our Chief Financial Officer and Head of Corporate Development and Strategy, in August 2020 that governs the general terms of his employment with us. Pursuant to the agreement, Dr. Al-Wakeel received a sign on bonus and reimbursement (including a tax gross up for such reimbursement) for certain relocation-related expenses incurred in his initial relocation to the greater San Mateo, California area. Dr. Al-Wakeel receives an annual base salary, is eligible to receive an annual target performance bonus of up to 40% of his annual base salary as determined by our Board of Directors, and is eligible for severance benefits upon an involuntary termination of his employment with us, as described in more detail below under the subsection titled “—Potential Payments and Benefits upon Termination or Change in Control.” Effective as of February 2023, Dr. Al-Wakeel’s base salary was increased from $425,000 to $450,000.
Executive Compensation Philosophy and Objectives
We operate in a highly competitive and rapidly evolving market, and our ability to compete is directly correlated to our ability to recruit and retain talented executives and employees. Our executive compensation program is intended to incentivize their achievement and align their interests with our stockholders. Our five principal objectives are to:
| ● | Attract, retain and inspire the most talented executives in our industry; |
| ● | Link rewards to the achievement of critical strategic priorities; |
| ● | Create incentives for our executive officers to further our ability to create long-term stockholder value; |
| ● | Provide appropriate level of risk and reward relative to an executive’s position with us; and |
| ● | Differentiate compensation based on individual performance, rewarding our strongest executives. |
The compensation of our named executive officers generally consists of a base salary, annual cash bonus, and equity incentive awards, as well as the employee benefits that are generally made available to our salaried employees.
| Kronos Bio | 33 | 2023 Proxy Statement |
Process for Setting Executive Compensation
We seek to foster a performance-oriented culture, where individual performance is aligned with organizational objectives. To achieve this, we evaluate and reward our executive officers based on their contributions to the achievement of annual goals and objectives set early in the year. Performance is reviewed at least annually through processes discussed further below, with a focus on our research, clinical, regulatory, financial and operational performance, and in view of economic and financial conditions affecting the performance period.
Role of Compensation Committee and Board of Directors
Our Compensation Committee is responsible for determining the compensation of our executive officers, other than our Chief Executive Officer (“CEO”), and for making recommendations to the Board of Directors with respect to our CEO’s compensation. In making compensation decisions, our Compensation Committee reviews by our management regarding base salaries, annual bonus, and equity incentive awards for our executive officers (other than the CEO) as well as recommendations and information provided by our independent compensation consultant, but our Compensation Committee is ultimately responsible for determining (or recommending, in the case of our CEO) the compensation of our executive officers. Our CEO is not present for any discussions of the Compensation Committee or Board of Directors regarding his performance or compensation.
The Compensation Committee’s authority, duties and responsibilities are further described in its charter. See “Information Regarding Committees of the Board of Directors – Compensation Committee” above.
The Compensation Committee retains a compensation consultant (as described below) to provide support in its review and assessment of our executive compensation programs.
Compensation Committee Processes and Procedures
Typically, the Compensation Committee meets at least quarterly and with greater frequency if necessary. The agenda for each meeting is usually developed by the Chair of the Compensation Committee, in consultation with the Chief Executive Officer, Chief Operating Officer and General Counsel, Corporate Secretary and Pearl Meyer, the Compensation Committee’s independent compensation consultant. The Compensation Committee meets regularly in executive session. However, from time to time, various members of management and other employees as well as outside advisors or consultants may be invited by the Compensation Committee to make presentations, to provide financial or other background information or advice or to otherwise participate in Compensation Committee meetings. The Chief Executive Officer may not participate in, or be present during, any deliberations or determinations of the Compensation Committee regarding his compensation or individual performance objectives. The charter of the Compensation Committee grants the Compensation Committee full access to all books, records, facilities and personnel of the Company. In addition, under the charter, the Compensation Committee has the authority to obtain, at the expense of the Company, advice and assistance from compensation consultants and internal and external legal, accounting or other advisors and other external resources that the Compensation Committee considers necessary or appropriate in the performance of its duties. The Compensation Committee has direct responsibility for the oversight of the work of any consultants or advisers engaged for the purpose of advising the Committee. In particular, the Compensation Committee has the sole authority to retain, in its sole discretion, compensation consultants to assist in its evaluation of executive and director compensation, including the authority to approve the consultant’s reasonable fees and other retention terms. Under the charter, the Compensation Committee may select, or receive advice from, a compensation consultant, legal counsel or other adviser to the Compensation Committee, other than in-house legal counsel and certain other types of advisers, only after taking into consideration six factors, prescribed by the SEC and Nasdaq, that bear upon the adviser’s independence; however, there is no requirement that any adviser be independent.
During the past fiscal year, after taking into consideration the six factors prescribed by the SEC and Nasdaq that did not raise a conflict of interest, the Compensation Committee continued its engagement of Pearl Meyer as a compensation consultant. The Compensation Committee requested that Pearl Meyer review industry-wide compensation practices and trends to assess the competitiveness of our executive and non-employee director compensation programs.
As part of its engagement, Pearl Meyer was requested by the Compensation Committee to review and propose changes to comparative group of companies and to perform analyses of competitive performance and compensation levels for that group.
| Kronos Bio | 34 | 2023 Proxy Statement |
Pearl Meyer also meets with certain members of management and human resources to learn more about the Company’s business operations and strategy, key performance metrics and strategic goals, as well as the labor markets in which the Company competes. Pearl Meyer ultimately developed recommendations primarily pertaining to our peer group and executive and non-employee director compensation determinations that were presented to the Compensation Committee for its consideration and to the Board for its information. Following an active dialogue with Pearl Meyer, the Compensation Committee recommended that the Board approve certain recommendations of Pearl Meyer.
In making compensation decisions, our Compensation Committee considers the recommendations of our CEO, with input from our Chief Operating Officer and General Counsel. Our CEO makes recommendations to our Compensation Committee with respect to executive officers, but does not participate in deliberations or determination of his own compensation. Our Compensation Committee reviews and makes a recommendation to the full Board related to the approval of corporate objectives and goals pursuant to the powers delegated under its charter. The CEO annually leads the development of our corporate objectives and goals, which are typically reviewed and approved by the Compensation Committee and then our Board. Our CEO provided the Company’s business and operations perspective for our Compensation Committee’s review of progress made on goals set for 2022. Other than described above, no other executive officers participate in the determination or recommendation of the amount or form of executive officer compensation.
Role of Compensation Consultant
In 2021, our Compensation Committee engaged Pearl Meyer and Partners, LLC (“Pearl Meyer”) as its independent compensation consultant. Pearl Meyer has assisted our Compensation Committee providing analysis and recommendations regarding trends in executive compensation, peer group selection, compensation practices, and equity plan utilization. Upon request, Pearl Meyer consultants attend meetings of our Compensation Committee, including executive sessions. Pearl Meyer reports to the Compensation Committee and not to Company management, although Pearl Meyer meets with management regularly to gather information for its analyses and recommendations.
With the assistance of Pearl Meyer, the Compensation Committee has selected our compensation peer group, consisting of comparable life sciences companies, taking into consideration such factors as valuation, stage and size, as well as areas of therapeutic focus. In 2021, the Compensation Committee chose the following peer group of companies to inform executive compensation decisions for 2022:
| Allogene Therapeutics, Inc. | Nkarta, Inc. | |
| AnaptysBio, Inc. | Nurix Therapeutics, Inc. | |
| Arcus Biosciences, Inc. | RAPT Therapeutics, Inc. | |
| C4 Therapeutics, Inc. | Relay Therapeutics, Inc. | |
| Gossamer Bio, Inc. | Replimmune Group, Inc. | |
| Gritstone bio, Inc. | Revolution Medicines, Inc. | |
| IGM Biosciences, Inc. | Rubius Therapeutics, Inc. | |
| iTeos Therapeutics, Inc. | SpringWorks Therapeutics, Inc. | |
| Kura Oncology, Inc. | Syndax Pharmaceuticals, Inc. | |
| Kymera Therapeutics, Inc. | TCR2 Therapeutics, Inc. |
Policy Against Hedging and Speculative Trading and Pledging our Common Stock
Our insider trading policy prohibits our employees from engaging in “hedging” or other inherently speculative transactions with respect to our common stock or borrowing against our common stock.
| Kronos Bio | 35 | 2023 Proxy Statement |
The base salaries of our executive officers are designed to compensate them for day-to-day services rendered during the fiscal year. Appropriate base salaries are used to recognize the experience, skills, knowledge, and responsibilities required of each executive officer, and to allow us to attract and retain individuals capable of leading us to achieve our business goals in competitive market conditions.
The base salaries of our executive officers are reviewed at least annually by our Compensation Committee and adjustments are made to reflect Company and individual performance, as well as competitive market practices. Our Compensation Committee also takes into account subjective performance criteria, such as an executive officer’s ability to lead, organize and motivate others, develop the skills necessary to grow with us as an organization, set realistic goals to be achieved in their respective area, and recognize and pursue new business opportunities that enhance our growth and success. Our Compensation Committee does not apply specific formulas to determine increases, but instead evaluates each executive officer’s contributions to our long-term success. Annual adjustments to base salaries are effective as of January 1 of each year, with mid-year adjustments to base salaries made under special circumstances, such as promotions or increased responsibilities.
The 2022 base salaries for our named executive officers were as follows:
| Name | 2022 Base Salary ($) |
| Norbert Bischofberger, Ph.D. | 580,000 |
| Yasir Al-Wakeel, BM BCh | 425,000 |
| Jorge DiMartino, M.D., Ph.D. | 455,000 |
Our named executive officers are eligible to receive performance-based cash bonuses, which are designed to provide appropriate incentives to our executive officers to achieve pre-established annual corporate goals and to reward them for individual performance towards these goals. The annual performance-based bonus each current named executive officer is eligible to receive is generally based on the extent to which we achieve the corporate goals that the Board establishes early each year. At the end of the year, the Board and Compensation Committee review our performance and evaluate the extent to which we achieved each of these corporate goals. Generally, the Board and Compensation Committee, as applicable, will assess each named executive officer’s individual contributions toward reaching our annual corporate goals.
| Kronos Bio | 36 | 2023 Proxy Statement |
The target bonus opportunities afforded to each named executive officer are provided as a percentage of base salary. For 2022, the target bonus opportunities were as follows:
| Name | 2022 Base Salary | 2022 Target Bonus Opportunity (% Salary) |
2022
Target Bonus Opportunity ($) |
| Norbert Bischofberger, Ph.D. | $580,000 | 50% | $290,000 |
| Yasir Al-Wakeel, BM BCh | $425,000 | 40% | $170,000 |
| Jorge DiMartino, M.D., Ph.D. | $455,000 | 40% | $182,000 |
The corporate goals used in our 2022 annual cash bonus plan were proposed by management and reviewed and approved by our Compensation Committee and our Board. The Board considered and assigned a relative weight to each corporate goal to appropriately focus efforts on achievements that were intended to enhance long-term stockholder value.
Our corporate goals for 2022, and the relative weighting of each corporate goal, were as follows:
| ● | The FDA agreeing that the company’s patient-level MRD data package was adequate to support a meeting to discuss surrogacy of MRD-negative CR as an accelerated approval endpoint (weighted at 5%); |
| ● | Enrolling 110 patients in the company’s planned Phase 3 AGILITY trial (weighted at 25%); |
| ● | The initial safety, PK and PD data for the company’s lanraplenib in combination with gilteritinib Phase 1b/2 trial supports the continued enrollment of the trial (weighted at 10%); |
| ● | The selection of the recommended phase 2 dose for KB-0742 (weighted at 20%); |
| ● | Advance two new discovery projects into Hit-to-Lead stage (weighted at 5% collectively); |
| ● | Advancing one Hit-to-Lead project to the Lead Optimization stage (weighted at 5%); |
| ● | Establishing an effective discovery target deconvolution protocol (weighted at 5%); |
| ● | Closing either (i) a platform/discovery collaboration or (ii) a regional partnering transaction for one or more clinical assets (weighted at 10%); |
| ● | Raising at least $100M or sufficient case to fund the company into 2025 (weighted at 10%); and |
| ● | Maintaining employee retention above 85% and achieving 90% of new hire targets for 2022 (weighted at 5%). |
The Board also established additional, or stretch, corporate goals as follows:
| ● | Exceeding enrollment goals for the AGILITY trial (weighted at 10%); |
| ● | Advancing a third new discovery project into Hit-to-Lead stage (weighted at 5%); and |
| ● | Closing one or more business development transactions that bring in at least $50m in aggregate “non-dilutive” upfront payments (weighted at 10%). |
In January and February 2023, our Compensation Committee and our Board reviewed our progress against these 2022 corporate goals and determined that, on an overall basis, we had attained 75% of our corporate goals. Our Compensation Committee and our Board determined that we had achieved our goals with respect to the patient level MRD data package (5%), the selection of the recommended Phase 2 dose in the KB-0742 trial (20%), the advancement of two projects to Hit-to-Lead and one from Hit-to-Lead to Lead Optimization (5% each, a cumulative 10%), the establishment of an accelerated discovery approach (5%) and
| Kronos Bio | 37 | 2023 Proxy Statement |
maintaining retention above 85% and achieving 90% of new hire targets (5%). With respect to the enrollment of the AGILITY trial, the Board awarded 5% achievement in recognition of the strategic decision to terminate the trial, the associated cost savings, and the achievement by the company to build its clinical development function to support future clinical trials. With respect to the Phase 1b/2 lanraplenib trial, the Compensation Committee awarded full credit for the startup and enrollment of the trial even while it had been deprioritized (10%). With respect to the closing of a platform/discovery collaboration, the Compensation Committee awarded full credit in recognition of the Company’s platform collaboration with Genentech, which closed January 6, 2023 (10%). With respect to the goal to raise $100 million or an amount sufficient to fund the company into 2025, the Compensation Committee awarded 5% credit in recognition that the upfront payment from the Company’s Genentech deal and its restructured operating plan extended projected cash runway into the second half of 2025.
In recognition of their efforts toward our achievement of such corporate goals and milestones, our Compensation Committee approved awarding Dr. Al-Wakeel and Dr. DiMartino 75% of their respective target annual cash bonus opportunity for 2022. Though Dr. Bischofberger also achieved 75% of his bonus opportunity, he elected to forgo his bonus. Additionally, in recognition of the exceptional performance of certain executives, the Compensation Committee also created an additional pool of funds to be awarded at Dr. Bischofberger’s discretion (other than to himself) in recognition of their 2022 contributions. As a result, in 2023, Drs. Al-Wakeel and DiMartino received special bonuses of $42,500 and $27,300, respectively.
The 2022 annual bonus payments are summarized in the tables below.
| Name | 2022 Target Bonus ($) |
2022 Company Achievement Factor |
2022 Annual Cash Bonus ($) | |||
| Norbert Bischofberger, Ph.D. | 290,000 | 75% | – (1) | |||
| Yasir Al-Wakeel, BM BCh. | 170,000 | 75% | 127,500 | |||
| Jorge DiMartino, M.D., Ph.D. | 182,000 | 75% | 136,500 |
| (1) | Dr. Bischofberger elected to forgo this bonus. |
Long-Term Incentive Compensation
We provide long-term incentive compensation to our executive officers through the grant of equity awards. We believe that equity awards incentivize our executive officers to execute our long-term strategic plan with the goal of creating value for our stockholders. We also believe equity awards foster an ownership culture, which is critical for aligning financial interests with that of our stockholders. In addition, the vesting requirements of our equity awards contributes to executive retention by providing an added incentive to our executive officers to remain employed by us during the vesting period.
Generally, equity awards are granted when an executive officer commences employment with us. Thereafter, equity awards may be granted at varying times and in varying amounts in the discretion of our Compensation Committee or, if awards are being granted to the CEO, in the discretion of the Board. Grants are generally made once a year, unless such executive officer is promoted or to recognize outstanding performance. None of our executive officers is currently party to an employment agreement that provides for an automatic grant of stock options or other equity awards.
Before approving equity awards, the Compensation Committee receives preliminary recommendations for equity awards from our CEO for executive officers (other than himself) for annual awards and awards made in connection with an executive’s hire or promotion. The Compensation Committee then reviews our compensation consultant’s market-based recommendations based on our peer group and survey data, and approves equity awards for our executive officers, with the exception of our CEO whose grant is reviewed and approved by the Board once it receives the recommendation of the Compensation Committee.
| Kronos Bio | 38 | 2023 Proxy Statement |
Outstanding Equity Awards at Fiscal Year-End Table
The following table presents information concerning equity awards held by our named executive officers as of December 31, 2022. The market value for the stock awards was calculated by multiplying the number of shares of our common stock subject to each award by $1.62, which was the closing market price of our common stock on December 30, 2022, the last trading day of fiscal year 2022.
| Option Awards(1) | Stock awards | |||||||||
| Executive Name | Grant date | Number of Securities Underlying Unexercised Options Exercisable (#) |
Number of Securities Underlying Unexercised Options Unexercisable (#) |
Option Exercise Price ($)(2) |
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 ($) | |||
| Norbert Bischofberger, Ph.D. | 4/30/2018 | – | – | 0.09 | 4/30/2028 | – | – | |||
| 3/17/2020 | – | – | 2.53 | 3/17/2030 | 99,055 | (4) | 160,469 | |||
| 7/10/2020 | – | – | 4.14 | 7/10/2030 | 79,425 | (5) | 128,669 | |||
| 12/10/2020 | 148,593 | 148,593 | (6) | 30.78 | 12/10/2030 | 66,042 | (10) | 106,988 | ||
| 2/16/2022 | 83,333 | (11) | 316,667 | 7.30 | 2/16/2032 | – | – | |||
| Jorge DiMartino, M.D., Ph.D. |
12/2/2019 | 292,762 | 87,038 | (7) | 2.53 | 12/2/2029 | – | – | ||
| 12/9/2020 | 100,453 | 100,453 | (8) | 30.94 | 12/9/2030 | 44,646 | (3) | 72,327 | ||
| 2/15/2022 | 18,750 | (12) | 71,250 | 7.08 | 2/15/2032 | 60,300 | (13) | 97,686 | ||
| 7/25/2022 | – | – | 5.02 | 7/25/2032 | 60,300 | (14) | 97,686 | |||
| Yasir Al-Wakeel, BM BCh |
8/17/2020 | 442,781 | – | 7.51 | 8/17/2030 | 187,922 | (9) | 304,434 | ||
| 12/9/2020 | 54,316 | 54,317 | (8) | 30.94 | 12/9/2030 | 24,141 | (3) | 39,108 | ||
| 2/15/2022 | 16,666 | (15) | 63,334 | 7.08 | 2/15/2032 | 53,600 | (13) | 86,832 | ||
| 7/25/2022 | – | 40,000 | 5.02 | 7/25/2032 | 53,600 | (14) | 86,832 | |||
| (1) | Option awards with grant dates prior to October 9, 2020 were granted under the 2017 Equity Incentive Plan. Stock and option awards with grants dates on or after October 9, 2020 were granted under the 2020 Equity Incentive Plan (the “2020 Plan”). |
| (2) | These options awards were granted with a per share exercise price equal to the closing fair market value of our common stock on the grant date. |
| (3) | These restricted stock units vest annually over three years, commencing on December 9, 2020, subject to continued service through each such vesting date. |
| (4) | These shares represent three grants with the following vesting schedules: (i) 339,621 shares vest over four years with 1/4 vesting on March 17, 2021 and the remainder vesting in 36 equal monthly installments, subject to continued service through each such vesting date; (ii) 177,808 vest in 24 equal monthly installments following the grant date, subject to continued service through each such vesting date (elected by Dr. Bischofberger as 50% of his salary for 24 months); and (iii) 71,123 shares vest in two equal annual installments commencing on the anniversary of the grant date (elected by Dr. Bischofberger as 50% of his performance bonus for 24 months). |
| (5) | These shares vest over three years commencing on July 10, 2020, with 36 equally monthly installments, subject to continued service through each such vesting date. |
| (6) | These shares vest over four years commencing on December 10, 2020, with 48 equally monthly installments, subject to continued service through each such vesting date. |
| (7) | These shares vest over four years with 1/4 vesting on December 2, 2020 and the remainder vesting in 24 equal monthly installments, subject to continued service through each vesting date. |
| (8) | These shares vest over four years commencing on December 9, 2020, with 48 equally monthly installments, subject to continued service through each vesting date. |
| (9) | These shares vest over four years commencing on August 17, 2020, with 1/4 vesting on the first anniversary of the vesting commencement date, and the remainder vesting in 24 equal monthly installments, subject to continued service through each such vesting date. This option was granted immediately exercisable, subject to a repurchase right in our favor which lapses as the option vests. The number of shares in this column reflects the number of shares subject to the option that were exercisable and unvested as of December 31, 2022. |
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| (10) | These restricted stock units vest annually over three years, commencing on December 10, 2020, subject to continued service through each such vesting date. |
| (11) | These shares vest monthly over four years commencing Feb 16, 2022. First tranche of 27,405 vesting annually and second tranche of 372,595 vesting monthly of commencing date. |
| (12) | These shares vest monthly over four years commencing Feb 15, 2022, subject to continued service through each such vesting date. |
| (13) | These restricted stock units vest annually over three years commencing Feb 15, 2022, subject to continued service through each such vesting date. |
| (14) | Half of these restricted stock units vest on June 30, 2023, and the remaining half on December 31, 2023, subject to continued service through each such vesting date. |
| (15) | These shares vest monthly over four years commencing Feb 15, 2022, subject to continued service through each such vesting date. |
| Kronos Bio | 40 | 2023 Proxy Statement |
Potential
Payments Upon
Termination or Change in Control
Our executive officers, including our named executive officers, are entitled to certain severance and change of control payments and benefits pursuant to our change in control and severance benefit plan (the “Change in Control Plan”). The Change in Control Plan provides for, in the event of an involuntary termination of employment without “cause” or a resignation with “good reason,” and subject to our receipt of an effective waiver and release of claims from the executive, a combination of (1) cash severance for the severance period and (2) the payment or reimbursement of premiums or continued coverage under group health plans for the severance period. The severance period is 24 months in the case of our Chief Executive Officer, and 12 months in the case of our other named executive officers.
In the event that the involuntary termination of employment occurs within the period commencing three months before and ending 12 months after a change in control of the Company, then the participants in the Change in Control Plan are entitled to the same benefits described above, but the severance period is 18 months for our General Counsel and Chief Operating Officer, Chief Medical Officer and Executive Vice President of Research and Development, Chief Financial Officer, and Chief Scientific Officer. In addition, our Chief Executive Officer would be entitled to 200% of his annual target bonus and our other named executive officers would be entitled to 150% of his or her annual target bonus, and each of our named executive officers would be entitled to accelerated vesting of outstanding equity compensation awards.
Under the Change in Control Plan, the term “cause” generally means (i) the employee’s commission of any crime involving fraud, dishonesty or moral turpitude; (ii) the employee’s attempted commission of or participation in a fraud or act of dishonesty against us that results in (or might have reasonably resulted in) material harm to our business; (iii) the employee’s intentional, material violation of any contract or agreement between us and the employee or any statutory duty that the employee owes to us; or (iv) the employee’s conduct that constitutes gross insubordination, incompetence or habitual neglect of duties and that results in (or might have reasonably resulted in) material harm to our business. The term “change in control” generally means (1) the acquisition by any person or company of more than 50% of the combined voting power of our then outstanding stock, (2) a merger, consolidation or similar transaction in which our stockholders immediately before the transaction do not own, directly or indirectly, more than 50% of the combined voting power of the surviving entity (or the parent of the surviving entity) in substantially the same proportions as their ownership immediately prior to such transaction, (3) a sale, lease, exclusive license or other disposition of all or substantially all of our assets other than to an entity more than 50% of the combined voting power of which is owned by our stockholders in substantially the same proportions as their ownership of our outstanding voting securities immediately prior to such transaction, or (4) a complete dissolution or liquidation of the company.
The term “good reason” generally means (i) a material reduction of such employee’s annual base salary, which is a reduction of at least 10% of such employee’s base salary (unless pursuant to a salary reduction program applicable generally to the Company’s similarly situated employees); (ii) a material reduction in such employee’s authority, duties or responsibilities; (iii) a relocation of such employee’s principal place of employment with the Company (or successor to the Company, if applicable) to a place that increases such employee’s one-way commute by more than 50 miles as compared to such employee’s then-current principal place of employment immediately prior to such relocation (excluding regular travel in the ordinary course of business).
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The following table provides an estimate of the potential payments and benefits pursuant to the Change in Control Plan, which could occur upon termination of the employment of our named executive officers, including in connection with a change of control of the Company, assuming a triggering event occurred on December 31, 2022:
| Name | Benefit | Termination without Cause or Resignation for Good Reason Not in Connection with a Change in Control ($) |
Termination
without Cause or Resignation for Good Reason in Connection with a Change in Control ($) |
| Norbert Bischofberger, Ph.D. | Lump Sum Cash Severance Payment | 580,000 | 870,000 |
| Lump Sum Target Bonus Payment | – | 435,000 | |
| Health Insurance Premiums | 10,831 | 16,247 | |
| Vesting Acceleration(1) | 106,988 | 106,988 | |
| Benefit Total | 697,819 | 1,428,235 | |
| Yasir Al-Wakeel, BM BCh | Lump Sum Cash Severance Payment | 318,750 | 425,000 |
| Lump Sum Target Bonus Payment | – | 170,000 | |
| Health Insurance Premiums | 30,080 | 40,106 | |
| Vesting Acceleration(1) | 212,772 | 212,772 | |
| Benefit Total | 561,602 | 847,878 | |
| Jorge DiMartino, M.D., Ph.D. | Lump Sum Cash Severance Payment | 341,250 | 455,000 |
| Lump Sum Target Bonus Payment | – | 182,000 | |
| Health Insurance Premiums | 17,773 | 23,697 | |
| Vesting Acceleration(1) | 267,699 | 267,699 | |
| Benefit Total | 626,721 | 928,396 |
| (1) | The value of the accelerated vesting of the outstanding stock options and restricted stock unit awards is based on the closing market price of $1.620 per share of our common stock on December 31, 2022, less, in the case of the stock options, the exercise price of the unvested stock option shares subject to acceleration. |
Our named executive officers are eligible to participate in our employee benefit plans, including our medical, dental, group term life, disability and accidental death and dismemberment insurance plans, in each case on the same basis as all of our other employees. We also maintain a Section 401(k) plan for our employees, including our named executive officers, as discussed in the section below entitled “— Section 401(k) Plan.”
We maintain a defined contribution employee retirement plan (the “401(k) Plan”), for our employees. Our executive officers are eligible to participate in the 401(k) Plan on the same basis as our other employees. The 401(k) Plan provides that each participant may contribute up to the lesser of 1-80% of the participant’s compensation, or the statutory limit, which was $20,500 for calendar year 2022. Participants 50 years or older could also make “catch-up” contributions of up to $6,500 in 2022. We currently make matching contributions to each participant’s account equal to 100% of eligible contributions up to the first 4% of eligible compensation. Participant contributions are held by the plan’s trustee and invested pursuant to the participant’s instructions.
| Kronos Bio | 42 | 2023 Proxy Statement |
We generally do not provide perquisites or personal benefits to our named executive officers. We do, however, from time to time, relocation benefits to our named executive officers as determined in our board’s discretion.
Our named executive officers are entitled to certain severance and change of control payments and benefits pursuant to our change in control and severance benefit plan (the “Plan”), as described in more detail in the section entitled “—Potential Payments Upon Termination or Change of Control.” The Plan provides for a combination of a lump-sum cash severance payment, continued health benefits and acceleration of vesting on outstanding equity awards under specified circumstances. Acceleration of vesting is subject to a “double trigger” arrangement, meaning that vesting acceleration occurs only in the event of a change in control of the Company in connection with or followed by a termination of employment without cause by us, or with good reason by the named executive officer.
Given the industry in which we operate and the range of strategic initiatives that we may explore, we believe these arrangements are an essential element of our executive compensation package and assist us in recruiting and retaining highly talented individuals. In addition, as we believe it may be difficult for our executive officers to find comparable employment following an involuntary termination of employment in connection with or following a change of control of the Company, these payments and benefits are intended to ease the consequences to an executive officer of an unexpected termination of employment. By establishing these payments and benefits, we believe we can mitigate the distraction and loss of executive officers that may occur in connection with rumored or actual fundamental corporate changes and thereby protect stockholder interests while a transaction is under consideration or pending.
Accounting and Tax Considerations
Under Financial Accounting Standard Board ASC Topic 718, or ASC Topic 718, we are required to estimate and record an expense for each share-based payment award (including stock options) over the vesting period of the award. We record share-based compensation expense on an ongoing basis according to ASC Topic 718. Our Compensation Committee has considered, and may in the future consider, the grant of performance-based or other types of stock awards to our executive officers in lieu of or in addition to stock options in light of the accounting impact of ASC Topic 718 and other considerations.
For federal income tax purposes, publicly-traded companies may be prohibited under Section 162(m) of the Code (“Section 162(m)”) from deducting employee remuneration in excess of $1 million paid to their chief executive officer, chief financial officer, any other executive officer whose total compensation is required to be reported to stockholders under the Exchange Act by reason of such individual being among the three highest compensated executive officers for the tax year, and any executive officer who was subject to the deduction limit in any tax year beginning after December 31, 2016. Even if Section 162(m) may limit the compensation deduction, our Board and our Compensation Committee believe our compensation policies and practices should be designed to help us meet our established goals and objectives. While our Board and our Compensation Committee will consider the impact of the Section 162(m) deduction limitation, they intend to continue to compensate our named executive officers in a manner that is in the best interests of our stockholders and reserve the right to make compensation decisions that may not be deductible under Section 162(m) where they determine the compensation to be appropriate and in the best interests of the Company and our stockholders.
| Kronos Bio | 43 | 2023 Proxy Statement |
Non-Employee Director Compensation Policy
Our Board of Directors adopted the following non-employee director compensation policy in September 2020:
| ● | an annual cash retainer of $35,000; |
| ● | an additional cash retainer of $30,000 for serving as Chair of the Board of Directors; |
| ● | an additional annual cash retainer of $7,500, $5,000 and $4,000 for service as a member (other than as chair) of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, respectively; |
| ● | an additional annual cash retainer of $15,000, $10,000 and $8,000 for service as chair of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, respectively (in lieu of the additional committee member annual cash retainer above); |
| ● | an initial option grant to purchase 41,200 shares of our common stock, vesting in three equal annual installments; and |
| ● | an annual option grant to purchase 20,600 shares of our common stock, vesting on the earlier of (a) the one-year anniversary of the date of grant and (b) the date of the next annual meeting of stockholders. |
| As a result of the periodic review of our non-employee director compensation policy, in February 2022, our Board of Directors and Compensation Committee reviewed and updated the policy for 2022, providing for the following: | |
| ● | an annual cash retainer of $40,000; |
| ● | an additional cash retainer of $30,000 for serving as Chair of the Board of Directors; |
| ● | an additional annual cash retainer of $7,500, $5,000 and $4,000 for service as a member (other than as chair) of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, respectively; |
| ● | an additional annual cash retainer of $15,000, $10,000 and $8,000 for service as chair of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, respectively (in lieu of the additional committee member annual cash retainer above); |
| ● | an initial equity grant with a fair market value of $670,000 on the date of grant, subject to a fixed share cap of 68,000 options equivalents, vesting in three equal annual installments, with the director designating the equity vehicles as either 100% options, 100% RSUs, or 50% options and 50% RSUs; and |
| ● | an annual equity grant with a fair market value of $335,000 on the date of grant, subject to a fixed share cap of 34,000 option equivalents, vesting on the earlier of (a) the one-year anniversary of the date of grant and (b) the date of the next annual meeting of stockholders, with the director designating the equity vehicles as either 100% options, 100% RSUs, or 50% options and 50% RSUs. |
The annual grants will be made on the date of each annual meetings of stockholders. The stock options and restricted stock unit awards will be granted under our 2020 Plan. Each of the equity awards described above will vest and become exercisable subject to the non-employee director’s continuous service with us through each applicable vesting date, provided that each option and restricted stock unit award will vest in full upon a change in control of the Company, as defined under our 2020 Plan.
| Kronos Bio | 44 | 2023 Proxy Statement |
2022 Director Compensation Table
The following table shows for the fiscal year ended December 31, 2022 certain information with respect to the compensation of all non-employee directors of the Company who served during 2022:
| Name | Fees Earned ($) |
Stock
Awards ($)(1) |
Option
Awards ($)(2) |
All Other Compensation ($) |
Total ($) |
| Arie Belldegrun, M.D., FACS | 80,000 | – | 78,452 | – | 158,452 |
| Roshawn Blunt | 45,000 | – | 78,452 | – | 123,452 |
| Marianne De Backer, Ph.D. | 52,500 | 40,005 | 39,226 | – | 131,731 |
| Joshua Kazam | 40,000 | – | 78,452 | – | 118,452 |
| Elena Ridloff, CFA | 55,000 | – | 78,452 | – | 133,452 |
| Otello Stampacchia, Ph.D. | 50,617 | – | 78,452 | – | 129,068 |
| David Tanen | 40,000 | – | 78,452 | – | 118,452 |
| Taiyin Yang, Ph.D. | 48,488 | 40,005 | – | – | 88,493 |
| (1) | The dollar amounts reported in this column reflect the aggregate grant date fair value of restricted stock units granted based on the closing market price of the Company’s common stock on the date of grant. As of December 31, 2022, the aggregate number of shares outstanding under all restricted stock units held by our non-employee directors were: Dr. De Backer: 11,333 and Dr. Yang: 11,333. |
| (2) | The dollar amounts reported in this column represent the aggregate grant date fair value of stock option awards granted in 2022. These amounts have been computed in accordance with FASB ASC 718, using the Black-Scholes option pricing model. For a discussion of valuation assumptions, see Note 9 “Stock-based Compensation” to our financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. As of December 31, 2022, the aggregate number of shares outstanding under all option awards held by our non-employee directors were: Dr. Belldegrun: 54,600, Ms. Blunt: 75,200, Dr. De Backer: 66,783, Mr. Kazam: 54,600, Ms. Ridloff: 102,200, Dr. Stampacchia: 54,600, Mr. Tanen: 160,100 and Dr. Yang: 63,350. |
In addition to serving as our President and Chief Executive Officer, Dr. Bischofberger served on our Board of Directors. He did not receive any additional compensation for his service as a member of our Board. See the section titled “Executive Compensation” for a summary of his compensation.
On April 10, 2023, our Board of Directors granted Katherine Vega Stultz an option to purchase 68,000 shares of our common stock at a per share exercise price equal to $1.29 as compensation for her service on the Board. The options will vest in 3 equal annual amounts on April 10th of each year, commencing on April 10, 2023. These options are subject to Ms. Stultz’s continuous service through the vesting dates. If Ms. Stultz’s continuous service is terminated by us without cause (as defined in our 2020 Plan) the period beginning 90 days prior to and ending 12 months following, a change of control (as defined in our 2020 Plan), then all of the then-unvested shares subject to the option will become fully vested and exercisable.
On April 20, 2023, our Board of Directors granted Roger Dansey an option to purchase 68,000 shares of our common stock at a per share exercise price equal to $1.28 as compensation for his service on the Board. The options will vest in 3 equal annual amounts on April 20th of each year, commencing on April 20, 2023. These options are subject to Dr. Dansey’s continuous service through the vesting dates. If Dr. Dansey’s continuous service is terminated by us without cause (as defined in our 2020 Plan) the period beginning 90 days prior to and ending 12 months following, a change of control (as defined in our 2020 Plan), then all of the then-unvested shares subject to the option will become fully vested and exercisable.
| Kronos Bio | 45 | 2023 Proxy Statement |
Item 402(v) Pay Versus Performance
The disclosure included in this section is prescribed by SEC rules and does not necessarily align with how the Company or our Compensation Committee view the link between the Company’s performance and named executive officer pay. In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and Item 402(v) of Regulation S-K, we provide the following disclosure regarding executive compensation actually paid (“CAP”) to our principal executive officer (“PEO”) and non-PEO named executive officers (“Non-PEO NEOs”) and certain aspects of our financial performance for the fiscal years listed below, intended to comply with the requirements of Item 402(v) of Regulation S-K applicable to “smaller reporting companies.” The Compensation Committee did not consider the Item 402(v) Pay Versus Performance disclosure below in making its compensation decisions for any of the years shown.
| Year | Summary
Compensation Table Total for PEO(1) ($) |
Compensation Actually Paid to PEO(2) ($) |
Average
Summary Compensation Table Total for Non-PEO NEOs(3) ($) |
Average Compensation Actually Paid to Non-PEO NEOs(4) ($) |
Value
of Initial Fixed $100 Investment Based On Total |
Net Income (Loss)(6) ($) |
| Shareholder Return(5) ($) | ||||||
| (a) | (b) | (c) | (d) | (e) | (f) | (g) |
| 2022 | 2,796,660 | (6,542,115) | 1,745,369 | (2,910,093) | 5.42 | (133,204,000) |
| 2021 | 644,975 | (19,895,507) | 658,273 | ($7,786,938) | 45.50 | (151,078,000) |
| (1) | The dollar amounts reported in column (b) are the amounts of total compensation reported for our PEO, Norbert Bischofberger (our Chief Executive Officer), for each corresponding year in the “Total” column of the Summary Compensation Table. Refer to “Executive Compensation—Summary Compensation Table.” |
| (2) | The dollar amounts reported in column (c) represent the amount of “compensation actually paid” to our PEO, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned by or paid to our PEO during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to our PEO’s total compensation for each year to determine the compensation actually paid: |
| Year | Reported | Less Grant Date Fair | Equity | Compensation
Actually Paid to PEO ($) |
| Summary
Compensation Table Total for PEO ($) |
Value
of Equity Awards Reported in the Summary Compensation Table for the Applicable Year for PEO ($) |
Total
Award Adjustments for PEO(a) ($) | ||
| 2022 | 2,796,660 | 1,986,960 | (7,351,815.30) | (6,542,115) |
| 2021 | 644,975 | – | (20,540,481.53) | (19,895,507) |
| (a) | The equity award adjustments for each applicable year include the addition (or subtraction, as applicable) of the following: (i) the year-end fair value of any equity awards granted in the applicable year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the applicable year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; (iii) for awards that are granted and vest in same applicable year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the applicable year, a deduction for the amount equal to the fair value at the end of the prior fiscal year; and (vi) the |
| Kronos Bio | 46 | 2023 Proxy Statement |
| dollar value of any dividends or other earnings paid on stock or option awards in the applicable year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the applicable year. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. The amounts deducted or added in calculating the equity award adjustments are as follows: |
| Year | Plus: Year End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for PEO |
Plus: Year over Year Change in Fair Value of Outstanding and Unvested Equity Awards for PEO |
Plus: Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year for PEO |
Plus: Year over Year Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year for PEO |
Less: Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year for PEO |
Plus: Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation for PEO |
Total Equity Award Adjustments for PEO |
| 2022 | $355,744 | ($3,874,977.35) | $250,478 | ($4,083,060) | $0 | $0 | ($7,351,815) |
| 2021 | $0 | ($14,196,010.37) | $0 | ($6,344,471) | $0 | $0 | ($20,540,482) |
| (3) | The dollar amounts reported in column (d) represent the average of the amounts reported for the non-PEO NEOs in the “Total” column of the Summary Compensation Table in each applicable year. The non-PEO NEOs included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2022, Jorge DiMartino and Yasir Al-Wakeel; and for 2021, Christopher Dinsmore, Barbara Kosacz, Jorge DiMartino and Yasir Al-Wakeel. |
| (4) | The dollar amounts reported in column (e) represent the average amount of “compensation actually paid” to the non-PEO NEOs, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the non-PEO NEOs during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for the non-PEO NEOs for each year to determine the compensation actually paid, using the same methodology described above in Note (2): |
| Year | Average | Less:
Average Grant Date Fair Value of Equity Awards |
Plus:
Total Average Equity |
Average
Compensation Actually Paid to Non-PEO NEOs ($) |
| Reported
Summary Compensation Table Total for Non-PEO NEOs ($) |
Reported
In the Summary Compensation Table for Applicable Year for Non-PEO NEOs ($) |
Award
Adjustments for Non-PEO NEOs(a) ($) | ||
| 2022 | 1,745,369 | 1,166,177.00 | (3,489,285.89) | (2,910,093) |
| 2021 | 658,274 | – | (8,445,211.67) | (7,786,938) |
| (a) | The amounts deducted or added in calculating the total average equity award adjustments are as follows: |
| Year | Plus:
Average Year End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Non-PEO NEOs ($) |
Plus:
Average Year over Year Change in Fair Value of Outstanding and Unvested Equity Awards for Non-PEO NEOs ($) |
Plus:
Average Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year for Non- PEO NEOs ($) |
Plus:
Average Year over Year Change in Fair Value of Equity Awards Granted in Prior Years that Vested in the Year for Non-PEO NEOs ($) |
Less:
Average Fair Value at the End of the Prior Year of Equity Awards that Failed to Meet Vesting Conditions in the Year for Non-PEO NEOs ($) |
Plus:
Average Value of Dividends or other Earnings Paid on Stock or Option Awards not Otherwise Reflected in Fair Value or Total Compensation for Non-PEO NEOs ($) |
Total
Average Equity Award Adjustments for Non-PEO NEOs ($) |
| 2022 | 284,887 | (2,370,668) | 53,444 | (1,456,948) | 0 | 0 | (3,489,286) |
| 2021 | 0 | (6,391,081) | 0 | (2,054,131) | 0 | 0 | (8,445,212) |
| (5) | Total shareholder return (TSR) is calculated as the difference between the Company’s share price at the beginning and the end of the measurement period, divided by the Company’s share price at the beginning of the measurement period. |
| (6) | The dollar amounts reported represent the amount of net loss reflected in the Company’s audited financial statements for the applicable year. Due to the fact that the Company is not a commercial-stage company, the Company did not have any revenue during the periods presented. Consequently, the Company did not use net income (loss) as a performance measure in its executive compensation program. |
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As described in more detail above in “Executive Compensation,” the Company’s executive compensation program reflects a performance-driven compensation philosophy. While the Company utilizes several performance measures to align executive compensation with Company performance, those Company measures are not financial performance measures and are therefore not presented in the Item 402(v) Pay Versus Performance table. Moreover, the Company generally seeks to incentivize long-term performance, and therefore does not specifically align the Company’s performance measures with “compensation actually paid” (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year. In accordance with Item 402(v) of Regulation S-K, we are providing the following descriptions of the relationships between information presented in the Item 402(v) Pay Versus Performance table above.
Compensation Actually Paid and Net Income (Loss)
Because the Company is a pre-commercial stage company, we had no revenue during the periods presented. Consequently, we do not use net income (loss) as a performance measure in our executive compensation program. Moreover, as a pre-commercial stage company with only limited, nonrecurring revenue associated with collaboration agreement(s), we do not believe there is any meaningful relationship between our net loss and compensation actually paid to our PEO and non-PEO NEOs during the periods presented.
The information provided above under the “Item 402(v) Pay Versus Performance” heading will not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent the Company specifically incorporates such information by reference.
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Compensation Actually Paid and Cumulative TSR
The chart below shows the relationship between the compensation actually paid to our PEO and the average compensation actually paid to our non-PEO NEOs, on the one hand, to the Company’s cumulative TSR over the two years presented in the table, on the other.
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Securities Authorized for Issuance Under Equity Compensation Plans
The following table sets forth the aggregate information of our equity compensation plans in effect as of December 31, 2022.
Equity Compensation Plan Information
| Plan Category | Number of securities
to be issued upon exercise of outstanding options, warrants and rights (a) |
Weighted-average exercise price of outstanding options, warrants and rights (b) ($)(1) |
Number of securities remaining available for issuance under equity compensation plans (excluding securities reflected in column (a)) (c) |
| Equity compensation plans approved by security holders: | |||
| 2017 Equity Incentive Plan(2) | 2,631,070 | 4.86 | – |
| 2020 Equity Incentive Plan(3) | 6,762,716 | 16.45 | 4,098,939 |
| 2020 Employee Stock Purchase Plan(4) | – | – | 1,457,645 |
| Equity compensation plans not approved by security holders | – | – | – |
| Total | 9,393,786 | 9.27 | 5,556,584 |
| (1) | The weighted average exercise price is calculated based solely on outstanding stock options. It does not take into account the shares of our common stock underlying restricted stock units, which have no exercise price. |
| (2) | As of December 31, 2022, under our 2017 Equity Incentive Plan (the “Prior Plan”), the number of outstanding awards under column (a) includes 2,631,070 shares which are issuable upon the exercise of outstanding options (including options that are immediately exercisable) at a weighted-average exercise price of $4.86. |
| (3) | In October 2020, we adopted our 2020 Equity Incentive Plan (the “2020 Plan”) which replaced the Prior Plan. Initially, the aggregate number of shares of our common stock that may be issued under the 2020 Plan was 11,938,152. Additionally, in each year, commencing in 2021 and ending in 2030, the number of shares authorized for issuance under the 2020 Plan is automatically increased by a number equal to: (a) 5% of the total number of shares of capital stock outstanding on December 31 of the preceding calendar year; or (b) such lesser number of shares of common stock as is determined by our Board or a designated committee thereof for the applicable year. As of December 31, 2022, under our 2020 Plan the number of outstanding awards under column (a) includes: (1) 4,519,269 shares to be issued upon the exercise of outstanding options (including options that are immediately exercisable) at a weighted-average exercise price of $16.45; and (2) 2,243,447 shares issuable upon the vesting of outstanding restricted stock units. As of March 31, 2023, the number of shares authorized for issuance under the 2020 Plan increased to 20,417,192 shares, of which 4,170,000 shares remained available for issuance under the 2020 Plan. |
| (4) | In October 2020, we adopted our Employee Stock Purchase Plan (the “ESPP”). The ESPP initially authorized the issuance of 688,000 shares of our common stock pursuant to purchase rights granted to our employees or to employees of any of our designated affiliates. Additionally, in each year, commencing in 2021 and ending in 2030, the number of shares authorized for issuance under the 2020 ESPP is automatically increased by a number equal to the lesser of: (a) 1% of the total number of shares of capital stock outstanding on December 31 of the preceding calendar year; (b) 1,376,000 shares; or (c) such lesser number of shares of Common Stock as is determined by our Board for the applicable year. The ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Code. As of March 31, 2023, the number of shares authorized for issuance under the ESPP increased to 2,383,807 shares, of which 2,027,319 remained available for issuance under the ESPP. |
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Transactions with Related Persons
Related-Person Transactions policy and Procedures
We have adopted a written related-person transactions policy that sets forth our policies and procedures regarding the identification, review, consideration and oversight of “related-person transactions.” For purposes of our policy only, a “related-person transaction” is a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which we and any “related person” are participants involving an amount that exceeds $120,000. Transactions involving compensation for services provided to us as an employee, consultant or director are not considered related-person transactions under this policy. A related person is any executive officer, director, nominee to become a director or a holder of more than five percent of our common stock, including any of their immediate family members and affiliates, including entities owned or controlled by such persons.
Under the policy, where a transaction has been identified as a related-person transaction, management must present information regarding the proposed related-person transaction to our Audit Committee (or, where review by our Audit Committee would be inappropriate, to another independent body of our Board of Directors) for review. The presentation must include a description of, among other things, all of the parties thereto, the direct and indirect interests of the related persons, the purpose of the transaction, the material facts, the benefits of the transaction to us and whether any alternative transactions are available, an assessment of whether the terms are comparable to the terms available from unrelated third parties and management’s recommendation. To identify related-person transactions in advance, we rely on information supplied by our executive officers, directors and certain significant stockholders. In considering related-person transactions, our Audit Committee or another independent body of our Board of Directors takes into account the relevant available facts and circumstances including, but not limited to:
| ● | the risks, costs and benefits to us; |
| ● | the impact on a director’s independence in the event the related person is a director, immediate family member of a director or an entity with which a director is affiliated; |
| ● | the terms of the transaction; |
| ● | the availability of other sources for comparable services or products; and |
| ● | the terms available to or from, as the case may be, unrelated third parties. |
In the event a director has an interest in the proposed transaction, the director must recuse himself or herself from the deliberations and approval.
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Certain Relationships and Related-Person Transactions
The following sections summarize transactions since January 1, 2021 to which we have been a party, in which the amount involved in the transaction exceeded $120,000 and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than 5% of our capital stock, including any of their immediate family members and affiliates, including entities owned or controlled by such persons, had or will have a direct or indirect material interest, other than equity and other compensation, termination, change in control and other arrangements, which are described under “Executive Compensation” and “Director Compensation”.
In December 2017, we entered into a consulting agreement with Two River. Joshua Kazam and David Tanen, each a member of our Board of Directors, are partners of Two River. Dr. Belldegrun serves as the Chairman of Two River but does not receive any salary, commission or other fees for serving in such capacity. Pursuant to the consulting agreement, Two River provides strategic, financial, business development and other consulting services and is compensated for such services rendered at a rate $25,000 per month. In June 2019, the consulting agreement was amended to change Two River’s compensation under the agreement to $90,000 per month. Dr. Belldegrun serves as the Chairman of Two River but does not receive any salary, commission or other fees for serving in such capacity. The agreement was amended on December 31, 2021 to limit the scope of the consulting services to accounting support and managerial services at approximately $8,000 per month.
In May 2019 we entered into a consulting agreement with Bellco. Arie Belldegrun, M.D., FACS, the Chairman of our Board of Directors, and Rebecka Belldegrun, M.D., a member of our Board of Directors until January 25, 2021, own and control Bellco. Pursuant to the consulting agreement, Bellco provides certain services for us, which are performed by Drs. Arie Belldegrun and Rebecka Belldegrun, and include without limitation, providing advice and analysis with respect to our business and strategy. In consideration for these services, we pay Bellco $2,100 per month in arrears commencing January 2019. We also reimburse Bellco for out of pocket expenses incurred in performing the services.
We have entered into indemnification agreements with each of our current directors and executive officers.
Householding of Proxy Materials
The SEC has adopted rules that permit companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for Notices of Internet Availability of Proxy Materials or other annual meeting materials with respect to two or more stockholders sharing the same address by delivering a single Notice of Internet Availability of Proxy Materials or other annual meeting materials addressed to those stockholders. This process, which is commonly referred to as “householding,” potentially means extra convenience for stockholders and cost savings for companies.
This year, a number of brokers with account holders who are Company stockholders will be “householding” the Company’s proxy materials. A single Notice of Internet Availability of Proxy Materials will be delivered to multiple stockholders sharing an address unless contrary instructions have been received from the affected stockholders. Once you have received notice from your broker that they will be “householding” communications to your address, “householding” will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in “householding” and would prefer to receive a separate Notice of Internet Availability of Proxy Materials, please notify your broker or the Company. Direct your written request to Kronos Bio, Inc., Secretary, 1300 So. El Camino Real, Suite 400, San Mateo, California 94402, or call us at (650) 781-5200. Stockholders who currently receive multiple copies of the Notices of Internet Availability of Proxy Materials at their addresses and would like to request “householding” of their communications should contact their brokers.
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The Board of Directors knows of no other matters that will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the meeting, it is the intention of the persons named in the accompanying proxy to vote on such matters in accordance with their best judgment.
By Order of the Board of Directors
Barbara Kosacz
Secretary
San Mateo, California
April 27, 2023
A copy of the Company’s Annual Report to the Securities and Exchange Commission on Form 10-K for the fiscal year ended December 31, 2022 is available without charge upon written request to: Secretary, Kronos Bio, Inc., 1300 So. El Camino Real, Suite 400, San Mateo, California 94402.
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