10-K/A: Organogenesis Holdings Files Amendment to 10-K, Discloses Executive Compensation and Governance Details

Organogenesis Holdings Inc. files an amendment to its 2024 annual report on Form 10-K to include Part III information regarding directors, executive officers, corporate governance, and executive compensation.

Summary

• Organogenesis Holdings Inc. filed Amendment No. 1 to its Form 10-K for the fiscal year ended December 31, 2024, to include information required by Part III of the form.
• The amendment provides details on the company's directors, executive officers, corporate governance practices, executive compensation, security ownership, related party transactions, and principal accounting fees and services.
• The document lists the names, ages, and positions of the company's directors as of April 11, 2025, along with brief biographical descriptions.
• It also includes similar information for the company's executive officers who are not directors.
• The filing details the composition and responsibilities of the board's Audit, Compensation, and Nominating Committees.
• Executive compensation information includes a compensation discussion and analysis, summary compensation table, grants of plan-based awards, outstanding equity awards, and potential payments upon termination or change in control.
• The document discloses related party transactions, including lease agreements with entities controlled by significant stockholders and repurchase agreements with existing stockholders.
• It also covers the company's policies and procedures for related party transactions and director independence.
• The filing includes information on the company's equity compensation plans and principal accounting fees and services.
• The report includes certifications from the CEO and CFO regarding the accuracy of the information and the effectiveness of internal controls.

Sentiment

Score: 6

Explanation: The document is primarily factual and descriptive, presenting information about the company's governance, executive compensation, and related party transactions. The sentiment is neutral, with no strong positive or negative indicators.

Positives

• The company has a compensation committee consisting of independent directors.
• The company has adopted a clawback policy covering executive officers.
• The company has remediated its material weakness in internal control over financial reporting as of December 31, 2024.
• The company has established change in control retention agreements for each of its NEOs.

Negatives

• The company engages in related party transactions, including leasing properties from entities controlled by board members and significant stockholders.
• The company repurchased shares from board members and significant stockholders at a price based on the 10-day trailing volume weighted average price of the Common Stock as of market close on November 11, 2024.

Risks

• Related party transactions, such as lease agreements with entities controlled by significant stockholders, could present potential conflicts of interest.
• The company's success depends on attracting, retaining, and rewarding high-quality executive talent.
• The company's financial performance is tied to achieving corporate performance objectives, including net revenue, gross margin, and Adjusted EBITDA.
• The company's compensation recovery policy is triggered by accounting restatements due to material noncompliance with financial reporting requirements.

Future Outlook

For 2025, the board of directors has again determined that the payment of any cash bonuses will be based on the achievement of pre-agreed corporate performance objectives which include the Company's net revenue (45%), gross margin percentage (10%) and Adjusted EBITDA (45%), with minimum, target and maximum goals set for each performance objective.

Industry Context

The document provides insight into the compensation practices and corporate governance structure of a company in the biotechnology, medical device, life sciences, and biopharmaceutical industries.

Comparison to Industry Standards

• The compensation committee uses peer group data from companies like Alphatec Holdings, LeMaitre Vascular, and MiMedx Group to benchmark executive compensation.
• The company's executive compensation program aims to align with business objectives, individual performance, and stockholder interests, similar to practices in comparable companies.
• The company's use of an independent compensation consultant, Pearl Meyer, is a common practice among publicly traded companies to ensure fair and competitive compensation.

Corporate Governance

Related Party Transactions

• The buildings we occupy in Canton, Massachusetts are owned (or in the case of 275 Dan Road, was owned until August 11, 2021) by entities that are controlled by Alan Ades, Albert Erani, Dennis Erani and Glenn Nussdorf.
• On January 1, 2013, we entered into a capital lease with 65 Dan Road SPE, LLC related to the facility at 65 Dan Road, Canton, Massachusetts.
• On January 1, 2013, we entered into a capital lease with 85 Dan Road Associates related to the facility at 85 Dan Road, Canton, Massachusetts.
• On January 1, 2013, we entered into a capital lease with Dan Road Equity I, LLC related to the facility at 150 Dan Road, Canton, Massachusetts.
• On November 12, 2024, we entered into Stock Repurchase Agreements with certain existing stockholders, pursuant to which we repurchased shares of Common Stock from such existing stockholders for a purchase price of $3.1597 per share, which represented the 10-day trailing volume weighted average price of the Common Stock as of market close on November 11, 2024.
• On November 27, 2024, we entered into a Stock Repurchase Agreement with the GN 2016 Family Trust u/a/d August 12, 2016 (GN 2016 Family Trust), pursuant to which we repurchased 500,000 shares of Common Stock from GN 2016 Family Trust for $2,028,500, at a purchase price of $4.057 per share, which represented the 10-day trailing volume weighted average price of the Common Stock as of market close on November 26, 2024.
• Gary Gillheeney, Jr., our Vice President, Customer Experience, is a child of Gary S. Gillheeney, Sr., our President and Chief Executive Officer, and he received total compensation of $406,643 in fiscal year 2024.
• James Gillheeney, one of our regional sales managers, is also a child of Gary S. Gillheeney, Sr. and he received total compensation of $268,973 in fiscal year 2024.

Stakeholder Impact

• Shareholders: The document provides information on executive compensation, equity ownership, and related party transactions, which are relevant to shareholders.
• Employees: The document outlines the company's compensation policies and benefit plans, which impact employees.
• Customers: The document does not directly address the impact on customers.
• Suppliers: The document does not directly address the impact on suppliers.
• Creditors: The document does not directly address the impact on creditors.

Next Steps

• The company expects that the holders of our Convertible Preferred Stock will elect Garrett Lustig as a Preferred Director substantially concurrent with our 2025 annual meeting of stockholders (the 2025 Annual Meeting).

Key Dates

Keywords

executive compensation, corporate governance, related party transactions, directors, executive officers, audit committee, compensation committee, stock repurchase, equity compensation, Form 10-K, Organogenesis