United states

The members of our nominating and corporate governance committee are Messrs. Philip Deutch, Stephen Bransfield and Daniel Weiss. Mr. Deutch is the chairman of our nominating and corporate governance committee. Our board of directors has determined that each member of our nominating and corporate governance committee is independent under the applicable rules of The NASDAQ Global Market.

Our board of directors may from time to time establish other committees.

Compensation Committee Interlocks and Insider Participation

Our compensation committee was comprised of Messrs. Paul Giovacchini, Philip Deutch, Daniel Weiss and Michael DeRosa during the years ended December 31, 2015, 2014, 2013 and from January 2016 until the effective date of our IPO in July 2016. Since the effective date of our IPO, our compensation committee has been comprised of Messrs. Paul Giovacchini, Philip Deutch, Michael DeRosa and Jack Henry. None of the members of our compensation committee is an officer or employee of our company. None of our executive officers currently serves, or in the past year has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our board of directors or compensation committee.

In March 2012, we sold an aggregate of 240 shares of our Senior Redeemable preferred stock at a purchase price of $25,000 per share. As part of this offering, we sold an aggregate of 6 shares of our Senior Redeemable preferred stock for an aggregate purchase price of $0.15 million to an entity affiliated with Energy Technology Partners, L.L.C., of which Mr. Deutch is the manager. We also sold an aggregate of 60 shares of our Senior Redeemable preferred stock for an aggregate purchase price of $1.5 million to an entity affiliated with Angeleno Group, of which Mr. Weiss is a co-founder and managing partner. We also sold an aggregate of 174 shares of our Senior Redeemable preferred stock for an aggregate purchase price of $4.35 million to entities affiliated with Element Partners, of which Mr. DeRosa is a managing director.

In May 2014, we sold an aggregate of 120 shares of our Super Senior Redeemable preferred stock at a purchase price of $25,000 per share. As part of this offering, we sold an aggregate of 10 shares of our Super Senior Redeemable preferred stock for an aggregate purchase price of $0.25 million to an entity affiliated with Angeleno Group, of which Mr. Weiss is a co-founder and managing partner. We also sold an aggregate of 110 shares of our Super Senior Redeemable preferred stock for an aggregate purchase price of $2.75 million to entities affiliated with Element Partners, of which Mr. DeRosa is a managing director.

 

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In June 2014, we sold an aggregate of 160 shares of our Super Senior Redeemable preferred stock at a purchase price of $25,000 per share. As part of this offering, we also sold an aggregate of 75 shares of our Super Senior Redeemable preferred stock for an aggregate purchase price of $1.875 million to an entity affiliated with Angeleno Group, of which Mr. Weiss is a co-founder and managing partner. We also sold an aggregate of 75 shares of our Super Senior Redeemable preferred stock for an aggregate purchase price of $1.875 million to entities affiliated with Element Partners, of which Mr. DeRosa is a managing director.

For more information regarding sales of our preferred stock, see “Certain Relationships and Related Party Transactions—Private Placements of Securities.”

Certain of our existing stockholders, consisting of entities associated with Element Partners, Angeleno Group and Landmark Partners, each of which is an affiliate of a member of our board of directors, as well as certain of our executive officers, purchased shares of common stock in our IPO.

Code of Business Conduct and Ethics

We have adopted a code of business conduct and ethics that is applicable to all of our employees, officers and directors including our chief executive officer and senior financial officers, which will be available on our website upon the closing of this offering.

Director Compensation

Prior to our IPO, we adopted a non-employee director compensation policy, based on the recommendations of our compensation committee, to provide compensation that enables us to attract and retain high caliber directors who are not our employees or officers and who are not affiliated with holders of our preferred stock. Under the non-employee director compensation policy, unaffiliated non-employee directors were entitled to cash compensation which consisted of a quarterly retainer of $13,750 as well as reimbursement for all reasonable out-of-pocket expenses incurred in attending meetings of the Board or any committees thereof.

In connection with our IPO, based on the recommendation of our compensation committee, we adopted a new non-employee director compensation policy. Under the new non-employee director compensation policy, each of our non-employee directors is entitled to an annual cash fee of $50,000. The Chairperson of the Board will receive an additional annual fee of $25,000 and the lead director, if we were to have a lead director who was not the Chairperson of the Board, will receive an additional annual fee of $15,000. In addition, members of our committees of the Board are entitled to receive additional compensation as follows: (i) each member of the audit committee (other than the chairperson thereof) is entitled to receive an annual fee of $10,000 and the chairperson of the audit committee is entitled to receive an additional annual fee $15,000, (ii) each member of the compensation committee (other than the chairperson thereof) is entitled to receive an annual fee of $7,500 and the chairperson of the compensation committee is entitled to receive an additional annual fee of $12,500 and (iii) each member of the nominating and corporate governance committee (other than the chairperson thereof) is entitled to receive an annual fee of $5,000 and the chairperson of the nominating and corporate governance committee is entitled to receive an additional annual fee of $10,000.

 

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Board of Directors		Annual Retainer
All non-employee members		$	50,000
		Additional Annual Retainers
Chairperson of the board of directors		$	25,000
Lead director		$	15,000
Audit committee chairperson		$	15,000
Audit committee member		$	10,000
Compensation committee chairperson		$	12,500
Compensation committee member		$	7,500
Nominating and corporate governance committee chairperson		$	10,000
Nominating and corporate governance committee member		$	5,000

In addition, upon initial appointment to the Board, each non-employee director will receive an option award with a grant date fair value of approximately $200,000, which will vest over four years (25% on the first anniversary of the grant date and 6.25% each quarter thereafter), subject to the director continuing to be a service provider to us through each applicable vesting date. Each non-employee director will also be entitled to receive an annual restricted stock unit award with a grant date fair value of approximately $60,000, which award will vest in full on the first anniversary of the grant date, subject to the director continuing to be a service provider to us through the vesting date; however, we did not grant any restricted stock unit awards to directors during the year ended December 31, 2016.

In the event of a “Sale Event” (as defined in the 2015 Plan), the then-outstanding and unvested equity awards held by the non-employee directors that were granted pursuant to this non-employee director compensation policy will become 100% vested.

We will reimburse all reasonable out-of-pocket expenses incurred by non-employee directors in attending meetings of the Board or any committee thereof.

Director Compensation Table

The following table presents the total compensation for each person who served as a member of our Board during the fiscal year ended December 31, 2016. Steven C. Lockard, who is our Chief Executive Officer, and Wayne G. Monie, who is our Chief Manufacturing Technology Officer, were employees during the fiscal year ended December 31, 2016 and received no additional compensation for their service as members of our Board. The compensation received by Messrs. Lockard and Monie, as Named Executive Officers of the Company, are presented below in “Executive Compensation—Summary Compensation Table.”

 

Name (1)		Fees Earned or Paid in Cash ($)				Stock Awards ($) (2)				Option Awards ($) (2)				Total ($)
Stephen Bransfield			60,000				—				—				60,000
Michael DeRosa			28,750				—				—				28,750
Philip Deutch			36,250				—				—				36,250
Paul Giovacchini			47,500				—				—				47,500
Jack Henry			68,750				—				—				68,750
James Hughes			57,500				—				—				57,500
Scott Humber (3)			—				—				—				—
Daniel Weiss			27,500				—				—				27,500

 

(1)

As of December 31, 2016, Messrs. Bransfield and Henry each had options to purchase 38,731 shares of our common stock outstanding and Messrs. DeRosa, Deutch, Giovacchini, Hughes and Weiss each had options to purchase 18,000 shares of our common stock outstanding. In addition, as of December 31, 2016,

 

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Messrs. Bransfield and Henry each had 18,000 restricted stock units outstanding and Messrs. DeRosa, Deutch, Giovacchini, Hughes and Weiss each had 2,880 restricted stock units outstanding.

 

(2)	We did not grant any stock option or restricted stock unit awards to our directors during the fiscal year ended December 31, 2016.

 

(3)	Mr. Humber resigned from the Board in July 2016 prior to the consummation of our IPO.

 

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EXECUTIVE COMPENSATION

Overview

Our compensation programs are designed to:

 

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attract, motivate and retain employees at the executive level who contribute to our long-term success;

 

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provide compensation packages to our executives that are competitive, reward the achievement of our business objectives and effectively align their interests with those of our stockholders; and

 

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increase the incentive to achieve key strategic performance measures by linking incentive award opportunities to the achievement of performance objectives and by providing a portion of total compensation for executive officers in the form of ownership in the company.

Our compensation committee is primarily responsible for developing and implementing our compensation policies and establishing and approving the compensation for all of our executive officers. The compensation committee oversees our compensation and benefit plans and policies, administers our equity incentive plans and reviews and approves annually all compensation decisions relating to our Chief Executive Officer. The compensation committee considers recommendations from our Chief Executive Officer regarding the compensation of our Chief Financial Officer, Chief Operating Officer and other executive officers (other than himself). Our compensation committee has the authority under its charter to delegate to a subcommittee the authority to approve grants of equity awards to certain individuals, subject to certain limitations including the amount of awards that can be granted pursuant to such delegated authority. To date, our compensation committee has only delegated such authority to a subcommittee consisting of two non-employee directors who are independent and qualify as “non-employee directors” under Section 16b-3(b)(3) of the Securities Exchange Act of 1934, as amended, as well as “outside directors” for purposes of Section 162(m) of the Code. Our compensation committee also has the authority under its charter to engage the services of a consulting firm or other outside advisor to assist it in designing our compensation programs and in making compensation decisions. In 2016, the compensation committee retained Pearl Meyer & Partners, LLC as its independent compensation consultant. We do not believe the retention of, and the work performed by, Pearl Meyer & Partners, LLC creates any conflict of interest.