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Proxy Statement (Form DEF 14A)

simu-20241222

______________________________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________________________________
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No.)
___________
Filed by the Registrantx
Filed by a party other than the Registranto
Check the appropriate box:
oPreliminary Proxy Statement
oConfidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
xDefinitive Proxy Statement
oDefinitive Additional Material
oSoliciting Material under §240.14a-12
Simulations Plus, Inc.
(Name of Registrant as Specified In Its Charter)
______________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
xNo fee required.
oFee paid previously with preliminary materials.
oFee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.
______________________________________________________________________
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held February 13, 2025
Notice is hereby given that the Annual Meeting of Shareholders ("Meeting") of Simulations Plus, Inc., a California corporation (the "Company"), will be held on Thursday, February 13, 2025, at 2:00 p.m. Pacific Time. We have adopted a completely virtual format for our Annual Meeting to provide a consistent and convenient experience to all shareholders regardless of location. You may attend the Meeting virtually via the Internet at www.virtualshareholdermeeting.com/SLP2025, where you will also be able to vote electronically and submit questions. You may also attend the Meeting by proxy and may submit questions ahead of the Meeting through the designated website. For further information about the virtual Meeting, please see the Questions and Answers about the Meeting beginning on the first page of the accompanying Proxy Statement. The purpose of the Meeting is as follows:
1.To elect five individuals to serve on the Company's Board of Directors until the next Annual Meeting of Shareholders of the Company or until their successors are duly elected and qualified, subject to prior death, resignation, or removal;
2.To ratify the selection of Rose, Snyder & Jacobs LLP as the independent registered public accounting firm for the Company for the fiscal year ending August 31, 2025;
3.To approve, on an advisory, nonbinding basis, the compensation of our named executive officers, as disclosed in the Proxy Statement; and
4.To consider and transact such other business as may properly come before the Meeting or any adjournments or postponements thereof.
All shareholders are cordially invited to attend the Meeting, although only shareholders of record at the close of business on December 17, 2024, the record date for the Meeting, will be entitled to notice of, and to vote at, the Meeting. A list of shareholders entitled to vote at the Meeting will be open to inspection by shareholders for a period of 10 days prior to the Meeting. If you would like to inspect the shareholder list, email [email protected]. The list of shareholders will also be available during the Meeting itself through the Meeting website for those shareholders who choose to attend.
Our Board of Directors has carefully reviewed and considered the foregoing proposals and has concluded that each proposal is in the best interests of the Company and its shareholders. Therefore, the Board of Directors has approved each proposal and recommends that you vote FOR each of the director nominees included in the accompanying Proxy Statement and FOR each of the other foregoing proposals.
We have elected to provide access to our proxy materials primarily electronically via the Internet, pursuant to the "Notice and Access" method regulations promulgated by the Securities and Exchange Commission. We believe this method expedites our shareholders' receipt of proxy materials, conserves natural resources and significantly reduces the costs of the Meeting. On or about December 23, 2024, we are mailing a one-page Notice of Internet Availability of Proxy Materials to each of our shareholders entitled to notice of and to vote at the Meeting, which contains instructions for accessing the attached Proxy Statement and our Annual Report on Form 10-K for our fiscal year ended August 31, 2024, (the "Annual Report") via the Internet, as well as voting instructions. The Notice of Internet Availability of Proxy Materials also includes instructions on how you can receive a paper copy of your proxy materials.
Shares can be voted at the Meeting only if the holder thereof is present virtually or represented by a proxy. To ensure that your shares are represented at the Meeting, we urge you to vote your shares promptly by proxy over the Internet, by phone, or by mail by following the instructions provided in the Notice of Internet Availability of Proxy Materials you received in the mail, or, if you requested to receive printed proxy materials, you may vote by marking, dating, and signing the enclosed proxy card and returning it in the postage-paid envelope provided. We encourage you to do so even if you plan to attend the Meeting virtually. The prompt voting of your shares, regardless of the number you hold, will aid the Company in reducing the expense of additional proxy solicitation. You may revoke your proxy at any time before it has been voted at the Meeting. Please note that dissenters' rights are not available with respect to the proposals to be voted on at the Meeting.
Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be Held on February 13, 2025.This notice of meeting, the accompanying proxy statement, and our annual report to shareholders, which includes our Annual Report, will be available on or about December 30, 2024, on www.proxyvote.com and on our website, www.simulations-plus.com.
By Order of the Board of Directors
/s/ Will Frederick
Will Frederick
Corporate Secretary
December 23, 2024
TABLE OF CONTENTS
Simulations Plus, Inc.
800 Park Offices Drive, Suite 401
Research Triangle Park, NC 27709
PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 13, 2025
QUESTIONS AND ANSWERS ABOUT THESE PROXY MATERIALS AND VOTING
Why am I receiving these materials?
Simulations Plus, Inc. ("we," "us," "our," "Simulations Plus" or the "Company") is making proxy materials, including this proxy statement (the "Proxy Statement") and the related proxy card, available to our shareholders electronically via the Internet because our Board of Directors (the "Board") is soliciting proxies to vote at the Company's Annual Meeting of Shareholders ("Meeting"). The Notice of Internet Availability of Proxy Materials containing instructions on how to access this Proxy Statement and our Annual Report on Form 10-K for the fiscal year ended August 31, 2024 (the "Annual Report"), and how to vote via the Internet, by phone, or by mail, is first being mailed to our shareholders of record entitled to vote at the Meeting on or about December 23, 2024. The Meeting is scheduled to be held on February 13, 2025, at 2:00 p.m. Pacific Time, via live webcast throughwww.virtualshareholdermeeting.com/SLP2025. You will need the 16-digit control number provided on the Notice of Internet Availability of Proxy Materials you received or your proxy card (if applicable) to vote your shares. This solicitation is for proxies for use at the Meeting or at any reconvened meeting after an adjournment or postponement of the Meeting, if applicable.
What am I voting on?
There are three matters scheduled for a vote at the Meeting:
Proposal No. 1 -To elect five individuals to serve on the Board until the next Annual Meeting of Shareholders of the Company or until their successors are duly elected and qualified, subject to prior death, resignation, or removal;
Proposal No. 2 -To ratify the selection of Rose, Snyder & Jacobs LLP ("RSJ") as our independent registered public accounting firm for the fiscal year ending August 31, 2025; and
Proposal No. 3 -To approve on, an advisory, nonbinding basis, the compensation of our named executive officers, as disclosed in this Proxy Statement.
Who can vote at the Meeting?
Only shareholders of record as of the close of business on December 17, 2024, the record date for the Meeting, will be entitled to notice of, and to vote at, the Meeting. The Company's common stock is its only class of voting securities issued and outstanding. As of the record date, December 17, 2024, there were 20,085,492 shares of the Company's common stock issued and outstanding.
Am I a shareholder of record for purpose of the Meeting?
If, as of the close of business on December 17, 2024, your shares were registered directly in your name with our transfer agent, Broadridge Corporate Issuer Solutions, Inc., then you are the shareholder of record for purposes of the Meeting.
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What if my shares are held in an account at a brokerage firm, bank, or dealer?
If, as of the close of business on December 17, 2024, your shares were held in an account at a brokerage firm, bank, dealer or other intermediary (commonly referred to as being held in "street name"), and these proxy materials are being forwarded to you by the organization holding your account, the organization holding your account is considered the shareholder of record with respect to your shares for purposes of the Meeting, and you are considered the beneficial owner of such shares. As a beneficial owner, you have the right to direct that organization on how to vote the shares in your account.
How do I vote?
With respect to the election of directors, you may vote "for" all of the nominees proposed by the Board, withhold your vote for all of such nominees, or vote for all of such nominees except those that you specify you would like to withhold your vote for. With respect to each of the (i) ratification of RSJ as our independent registered public accounting firm for the fiscal year ended August 31, 2024, and (ii) approval on an advisory, non-binding basis, of named executive officer compensation, you may vote "for" or "against" or abstain from voting altogether.
To be timely, your voting instructions must be received no later than 11:59 p.m., EasteTime, on February 12, 2025. Please note that you may still attend the Meeting and vote virtually during the Meeting, even if you have already voted by phone or by proxy via either the Internet or mail.
Shareholders of Record: Shares Registered in Your Name
If you are a shareholder of record, you may vote your shares by proxy over the Internet, or by phone or mail by following the instructions provided in the Notice of Internet Availability of Proxy Materials you received, or, if you requested to receive printed proxy materials, you may vote by marking, dating, and signing the enclosed proxy card and returning it in the postage-paid envelope provided. Additionally, you may vote your shares virtually at the Meeting by visitingwww.virtualshareholdermeeting.com/SLP2025and using the 16-digit control number provided on the Notice of Internet Availability of Proxy Materials you received or your proxy card (if applicable).
Beneficial Owner: Shares Held in "Street Name"
If you are a beneficial owner of shares held in "street name," you should have received instructions from the organization holding your shares that you must follow for your shares to be voted. The availability of telephonic or Internet voting will depend on the voting process of such organization. Alternatively, you may vote virtually at the Meeting by visitingwww.virtualshareholdermeeting.com/SLP2025and using the 16-digit control number provided on the Notice of Internet Availability of Proxy Materials you received or your proxy card (if applicable). However, in order to do so, you must obtain a "legal" proxy from the organization holding your shares and present it and proof of identification to the inspector of elections at the Meeting. Please contact the organization that holds your shares if you wish to obtain a "legal" proxy.
Regardless of how your shares are held, and whether or not you plan to attend the Meeting, we encourage you to vote your shares via the Internet or phone or by returning a completed proxy card to ensure that your vote is counted.
If my shares are held in "street name" by a broker or other intermediary, will my broker or intermediary vote my shares for me?
If your shares are held in "street name" and you do not instruct your broker or other intermediary on how to vote your shares, your broker or other intermediary may exercise its discretion to vote your shares only on "routine" matters.
The election of directors is considered a nonroutine matter. Consequently, without your voting instructions, your broker or other intermediary cannot vote your shares on this proposal.
The proposal to ratify the selection of RSJ as our independent registered public accounting firm is considered a routine matter. Therefore, your broker or other intermediary will be able to vote on this proposal, even if it does not receive voting instructions from you.
The proposal to approve on an advisory, nonbinding basis, the compensation of our named executive officers considered a nonroutine matter. Consequently, without your voting instructions, your broker or other intermediary cannot vote your shares on this proposal.
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How are votes counted?
Votes will be counted by the Company's corporate secretary, who will separately count "for" and "against" votes (other than with respect to the election of directors, as to which there is no "against" vote, and there is a "withheld" vote instead), abstentions, and "broker non-votes."
If you provide specific instructions with respect to a proposal item, your shares will be voted as you instruct on such proposal. If you sign your proxy card without giving specific instructions, your shares will be voted in accordance with the recommendations of the Board ("for" each of the director nominees identified herein, "for" each other proposal, and in the discretion of the proxy holder on any other matters that properly come before the Meeting).
What is a "broker non-vote"?
A "broker non-vote" occurs when a beneficial owner of shares held in street name does not give instructions to the broker or other intermediary holding the shares as to how to vote on matters deemed "nonroutine." Generally, if shares are held in street name, the beneficial owner of the shares is entitled to give voting instructions to the broker or other intermediary holding the shares. If the beneficial owner does not provide voting instructions, the broker or other intermediary can still vote the shares with respect to matters that are considered to be "routine," but not with respect to "nonroutine" matters. Under the rules and interpretations of the New York Stock Exchange, "nonroutine" matters are generally those involving a contest or a matter that may substantially affect the rights or privileges of shareholders, such as mergers, dissolutions, or shareholder proposals.
How many "for" votes are needed to approve each proposal?
Proposal No. 1: The election of directors will be decided by a plurality of votes cast. Accordingly, the five nominees receiving the highest number of "for" votes will be elected. Withheld votes and broker non-votes will have no effect on the outcome of this proposal.
Proposal No. 2:The ratification of the selection of RSJ as our independent registered public accounting firm must receive a "for" vote from the holders of a majority of the shares of our common stock represented and voting at the Meeting. In addition, the shares voting affirmatively must equal at least a majority of the quorum that is required to conduct business at each meeting; this means that the shares voting affirmatively must be greater than 25 percent of the outstanding shares entitled to vote. Abstentions and broker non-votes, if any, will have no effect. Brokers and other intermediaries generally will have discretionary authority to vote on this proposal because it is considered a routine matter, and, therefore, we do not expect broker non-votes with respect to this proposal.
Proposal No. 3:To be approved on an advisory basis, the compensation of our named executive officers requires the affirmative vote of a majority of the shares of our common stock represented and voting at the Meeting. In addition, the shares voting affirmatively must equal at least a majority of the quorum that is required to conduct business at each meeting; this means that the shares voting affirmatively must be greater than 25 percent of the outstanding shares entitled to vote. Abstentions and broker non-votes will have no effect.
How many votes do I have?
Each shareholder of record as of December 17, 2024, is entitled to cast one vote for each share of our common stock held as of the record date on each matter to come before the Meeting, except that shareholders may have cumulative voting rights with respect to the election of directors.
Cumulative voting allows a shareholder to cast a number of votes equal to the number of directors to be elected, which is five, multiplied by the number of shares such shareholder is entitled to vote. This total number of votes may be cast for one nominee or may be distributed among as many nominees as the shareholder desires. Under California law, no shareholder can cumulate votes unless, prior to voting at the Meeting, such shareholder or any other shareholder entitled to vote has given notice of his or her intention to cumulate his or her votes at the Meeting. If any shareholder properly gives such notice, then all shareholders may cumulate their votes for the election of directors. Our Board does not, at this time, intend to give such notice or to cumulate the votes it may hold pursuant to the proxies solicited herein unless the required notice by a shareholder is given, in which event shares represented by proxies solicited by this Proxy Statement may be cumulated at the discretion of the proxy holders, in accordance with the recommendation of our Board.
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What is the quorum requirement?
A quorum of shareholders is necessary to conduct the business of the Meeting. A quorum will be present if at least a majority of the outstanding shares of our common stock as of the record date are present either virtually or by proxy at the Meeting. On the record date, December 17, 2024, there were 20,085,492 shares outstanding and entitled to vote. Accordingly, 10,042,746 shares must be present either virtually or by proxy at the Meeting to establish a quorum at the Meeting.
If you submit a valid proxy (by Internet, phone, or mail), regardless of whether you abstain from voting on one or more matters, your shares will be counted as present at the Meeting for purposes of determining a quorum. Broker non-votes will also be counted as present at the Meeting for purposes of determining a quorum. If there is no quorum, a majority of the shares present either virtually or by proxy at the Meeting may adjouthe Meeting to another date.
What does it mean if I receive more than one Notice of Internet Availability of Proxy Materials?
If you receive more than one Notice of Internet Availability of Proxy Materials, then your shares are registered in more than one name or are registered in different accounts. Please follow the instructions on each Notice of Internet Availability of Proxy Materials you receive to ensure that all of your shares are voted at the Meeting.
What if I vote online or retua proxy card but do not make specific choices?
If you vote online, or retua signed and dated proxy card, without marking any voting selections, all of your shares will be voted "for" the election of each of the nominees for director described herein, "for" the ratification of RSJ as our independent registered public accounting firm for the fiscal year ending August 31, 2025, and "for" the compensation of our named executive officers. If any other matter is properly presented at the Meeting, your proxy (one of the individuals named on your Notice of Internet Availability of Proxy Materials or on your proxy card) will vote your shares using his or her best judgment.
Can I change my vote after submitting my proxy?
You can change your vote with respect to any proposal by revoking your proxy at any time prior to the close of voting with respect to that proposal at the Meeting. You may revoke your proxy in one of three ways:
•By delivering to our corporate secretary (c/o Will Frederick, Simulations Plus, Inc. P.O. Box 12317, Research Triangle Park, NC 27709) a duly executed proxy bearing a date later than the date of the proxy you wish to revoke. Such later-dated proxy must be delivered before voting begins at the Meeting.
•By delivering to our corporate secretary (c/o Will Frederick, Simulations Plus, Inc. P.O. Box 12317, Research Triangle Park, NC 27709) a written notice of revocation dated later than the date of the proxy you wish to revoke. Such written notice of revocation must be delivered before voting begins at the Meeting.
•By attending the Meeting and voting virtually at the Meeting. Bear in mind that simply attending the Meeting will not, by itself, revoke your proxy. In addition, please recall that if you are a beneficial owner of shares held in "street name" and wish to vote virtually at the Meeting, you must obtain a "legal" proxy from the organization holding your shares and present it to the inspector of elections, along with proof of identification, at the Meeting.
Following the close of voting with respect to a proposal, you may not revoke your proxy or otherwise change your vote with respect to such proposal.
Are dissenters' rights available with respect to any proposal?
Dissenters' rights are not available with respect to any proposal to be voted on at the Meeting.
How can I find out the results of the voting at the Meeting?
Preliminary voting results are expected to be announced at the Meeting. We will report final voting results in a Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the "SEC") within four business days after the Meeting.
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Who is paying for this proxy solicitation?
We are soliciting proxies from our shareholders on behalf of our Board and will pay for all costs incurred in connection with such solicitation. In addition to soliciting proxies by this Proxy Statement, our directors and employees may also solicit proxies virtually at the Meeting, 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.
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PROPOSAL NO. 1: ELECTION OF DIRECTORS
Nomination of Directors
The Nominating & Corporate Governance Committee of the Board is charged with making recommendations to the Board regarding qualified candidates to serve as members of the Board. The Nominating & Corporate Governance Committee's goal is to assemble a board of directors with the skills and characteristics that, taken as a whole, will assure a strong board of directors with experience and expertise in matters relevant to the Company and all aspects of corporate governance. Accordingly, the Nominating & Corporate Governance Committee believes that candidates for director should have certain minimum qualifications, including personal integrity, strength of character, an inquiring and independent mind, practical wisdom, and mature judgment. In evaluating director nominees, the Nominating & Corporate Governance Committee considers the following factors:
(1)The appropriate size of the Board;
(2)The Company's needs with respect to particular talents and experience of its directors;
(3)The knowledge, skills, and experience of nominees in technology, business, risk management, finance, administration, and the healthcare information technology and data analytics software and services industry; and
(4)Relevant Nasdaq, SEC, California, and investor recommendations and requirements.
Other than the foregoing, there are no stated minimum criteria for director nominees, although the Nominating & Corporate Governance Committee may also consider such other factors as it deems to be in the Company's and its shareholders' best interests. The Nominating & Corporate Governance Committee states in its charter that it is committed to consideration of qualified directors of diverse gender, race, age, color, religion, national origin, sexual orientation, genetic information, marital status, disability, or covered veterans' status, and seeks nominees from a broad variety of sources. Furthermore, the Nominating & Corporate Governance Committee is committed to complying with the Nasdaq board diversity rules, and, to the extent applicable, any state or other diversity related requirements. The Nominating & Corporate Governance Committee believes it is appropriate for at least one member of the Board to meet the criteria for an "audit committee financial expert," as defined by SEC rules, and for a majority of the members of the Board to meet the definition of an "independent director" under Nasdaq listing standards.
The Nominating & Corporate Governance Committee identifies nominees by first evaluating the current members of the Board willing to continue in service. Current members of the Board with skills and experience that are relevant to our business and who are willing to continue in service are considered for renomination, but the Nominating & Corporate Governance Committee at all times seeks to balance the value of continuity of service by existing members of the Board with that of obtaining a new perspective. If any member of the Board does not wish to continue in service, the Nominating & Corporate Governance Committee's policy is to not renominate that member for reelection. The Nominating & Corporate Governance Committee identifies the desired skills and experience of a new nominee, and then uses its network of contacts to compile a list of candidates.
We do not have a formal policy concerning shareholder recommendations of nominees for director to the Nominating & Corporate Governance Committee and, to date, we have not received any recommendations from shareholders requesting the Nominating & Corporate Governance Committee to consider a candidate for inclusion among the Nominating & Corporate Governance Committee's slate of nominees in our proxy statement. Shareholders wishing to recommend a candidate may do so by sending a written notice to the Nominating & Corporate Governance Committee, Attn: Chair, Simulations Plus, Inc., P.O. Box 12317, Research Triangle Park, NC 27709, naming the recommended candidate and providing detailed biographical and contact information for such recommended candidate. At the sole discretion of the Nominating & Corporate Governance Committee, a third-party consultant may be engaged at an appropriate fee, to help evaluate such candidate for membership to the Board. If the Nominating & Corporate Governance Committee recommends that such candidate be nominated for appointment to the Board, and the Board approves the nomination, the recommended candidate's name will be included in the Company's proxy statement for election by the Company's shareholders at the appropriate time; however, shareholder approval will not be required to appoint a new director to fill a vacancy on the Board other than in connection with an annual meeting of the Company's shareholders.
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There are no arrangements or understandings between any of our directors, nominees for directors or officers, or any other person, pursuant to which any director, nominee for director, or officer was or is to be selected as a director, nominee, or officer, as applicable. To our knowledge, there currently are no legal proceedings, and during the past ten years there have been no legal proceedings, that are required to be disclosed pursuant to Item 4.01(f) of Regulation S-K. There are no material proceedings to which any director, officer, affiliate, or owner of record or beneficial owner of more than 5% of any class of voting securities of the Company, or any associates of any such persons, is a party averse to the Company or any of our subsidiaries (either current or previous), and to our knowledge, none of such persons has a material interest averse to the Company or any of its subsidiaries (either current or previous). To our knowledge, other than as disclosed below, during the last 5 years, none of our directors held any other directorships in any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940. There are no familial relationships between any officers and directors of the Company.
The Nominating & Corporate Governance Committee has recommended, and the Board has nominated, Dr. Daniel Weiner, Dr. Walter S. Woltosz, Dr. John K. Paglia, Dr. Lisa LaVange and Sharlene Evans as nominees for election as members of our Board at the Meeting. At the Meeting, five directors will be elected to the Board.
Information Concerning Directors
NAME AGE POSITION WITH THE COMPANY ELECTED DIRECTOR SINCE
Dr. Daniel Weiner 74 Board Chair 2017
Dr. Walter S. Woltosz 79 Director 1996
Dr. John K. Paglia 57 Director 2014
Dr. Lisa LaVange 71 Director 2019
Sharlene Evans 60 Director 2021
DR. DANIEL WEINER has been a director of the Company since May 1, 2017, served as Lead Independent Director of the Board from October 20, 2022 to December 17, 2024, and was appointed as Chairman of the Board on December 17, 2024. Dr. Weiner is also an independent director of Simmunone, Inc. Dr. Weiner graduated from the University of Kentucky with a doctoral degree in Mathematical Statistics, with an emphasis on compartmental modeling. Dr. Weiner has served as an expert consultant to the U.S. Food and Drug Administration ("FDA") on pharmacokinetic modeling and bioequivalence assessment and is the 2022 American Society for Clinical Pharmacology & Therapeutics ("ASCPT") recipient of the Sheiner-Beal Award in Pharmacometrics. Dr. Weiner is a Fellow of the American Statistical Association ("ASA"). Dr. Weiner has held senior management positions at companies such as Merrell Dow Pharmaceuticals; Statistical Consultants, Inc. (founder); Syntex Development Research; Certara Inc.; Pharsight Corp.; Quintiles, Inc. (now IQVIA); and IVAX Research, where he had operational responsibilities as well as assisting with M&A activities. Dr. Weiner is an Adjunct Professor with the Division of Pharmacotherapy and Experimental Therapeutics in the School of Pharmacy, University of North Carolina. He is the original designer/author of the WinNonlin family of PK/PD Modeling Software and is the co-author of Pharmacokinetic and Pharmacodynamic Data Analysis: Concepts and Applications. Dr. Weiner previously served as a Board member of DILIsym Services, Inc. ("DILIsym"), which was merged into the Company in September 2021. We believe that Dr. Weiner's extensive industry knowledge, expertise, and experience make him a qualified candidate for the Board.
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DR. (HON) WALTER S. WOLTOSZ is a cofounder of the Company, served as its Chief Executive Officer until June 26, 2018, and has served as a director of the Company since June 1996, including as Chairman of the Board from July 17, 1996 to December 17, 2024. As author/coauthor of over 70 technical publications, conference papers, and two book chapters over 25 years, his expertise in pharmacokinetics and machine-learning methodology for pharmaceutical research is well-recognized. He is also a significant investor in, and independent director of, the Vulcan Line Tools Corporation in Birmingham, Alabama. He was confirmed as as Trustee for the AubuUniversity by the Alabama Senate on March 21, 2024, for a seven-year term that will expire on March 20, 2031. Prior to cofounding the Company, Dr. Woltosz served in the United States Air Force as a missile systems analyst; as an electronics engineer with the Federal Aviation Administration; with Northrop Services developing simulation/optimization software for the space shuttle ascent trajectory; and with the Thiokol corporation, Air Force Rocket Propulsion Laboratory, and United Technologies Corporation Chemical Systems Division as a rocket motor engineer. In 1981, he established Words+, Inc., a company that designs, manufactures, and sells computer-based communication systems, including the system formerly used by Professor Stephen Hawking. Dr. Woltosz holds the Distinguished AubuEngineer Award, AubuAlumni Association Lifetime Achievement Award, and is a member of the State of Alabama Engineering Hall of Fame. He is a member of the AubuAlumni Engineering Council, the Engineering Keystone Society, the Engineering Eagles Society, and the Engineering Ginn Society, as well as the 1856 Society and the Pat Dye Society. Dr. Woltosz holds Bachelor's and Master's degrees in aerospace engineering, and an honorary Doctor of Science (D.Sc.) from AubuUniversity, as well as a Master's degree in administrative science from the University of Alabama, Huntsville. We believe that Dr. Woltosz's knowledge of the industry, his 28 years with the Company, and his 31 years of experience running Words+ make him a qualified candidate for the Board.
DR. JOHN K. PAGLIA, a recipient of several prestigious honors for his work in the financing and capital markets space, has been a director of the Company and Chair of the Audit Committee since December 3, 2014. Additionally, he is an independent director and audit committee chair for Aeluma, Inc. (OTCQB:ALMU) and Splash Beverage, Inc. (NYSE-A: SBEV), is an independent director for Impossible Kicks Inc., is Chief Investment Officer (Interim) at UNest, Inc., and is an advisor to venture capital funds and startup companies. At Pepperdine University's Graziadio Business School, he is a tenured Professor of Finance where his specialty areas are venture capital, private equity, corporate finance, business valuations, and mergers and acquisitions ("M&A"). In addition, he held a number of leadership positions at Pepperdine University since joining in 2000, including as Senior Associate Dean where he had oversight for nearly 200 business school faculty members and key strategic projects. Dr. Paglia holds a Ph.D. in finance from the University of Kentucky, an MBA from Gannon University, and a B.S. in finance from Gannon University. He is a Certified Public Accountant, a Chartered Financial Analyst® Charterholder, and is NACD Directorship Certified™. We believe his knowledge of technical accounting issues and business experience qualify him as an expert in financial matters and as a qualified candidate for the Board.
DR. LISA LAVANGE has been a director of the Company since May 1, 2019. Dr. LaVange graduated from the University of North Carolina ("UNC") with a doctoral degree in Biostatistics. Dr. LaVange is currently Professor Emerita and former Chair of Biostatistics, retiring from UNC in October 2023. From 2011 to 2017, Dr. LaVange served as Director of the Office of Biostatistics in the Center for Drug Evaluation and Research ("CDER") at the FDA, where she oversaw more than 200 statisticians involved in the review of new drugs, therapeutic biologics, and generics. She also established the FDA's complex innovative design initiative and continues to contribute to research in innovative clinical trials design and analysis. Previously, she worked in the pharmaceutical industry at the level of Vice President. Dr. LaVange is a fellow of the American Statistical Association ("ASA"), was the 2018 ASA President, and served on the ASA Board of Directors from 2017 to 2019 (and as Chair in 2018). She is also a former Board member of the International Biometric Society and served as regional president. Dr. LaVange is the recipient of numerous awards in clinical, statistical, and regulatory science, including the 2020 award for Outstanding Contribution to Health in the Americas Region from the Drug Information Association and the 2023 ICH Award for Outstanding Contribution to Harmonization for Better Health, nominated by the US FDA. We believe that Dr. LaVange's extensive experience, knowledge, and industry expertise make her a qualified candidate for the Board.
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SHARLENE EVANS was appointed as a director of the Company as of December 1, 2021. Ms. Evans received a Bachelor's degree in Industrial Engineering from AubuUniversity, and graduated from Purdue University with a Master's degree in Industrial Engineering. Ms. Evans has a proven track record in executing large-scale improvement projects across complex, multisite organizations for Fortune 500 clients. She currently serves as a Partner/People Leader for the Americas for EFESO Management Consultants. She was previously a Principal Director at Accenture, where she led deployment of capabilities in organization design, change management, and leadership development as part of client transformation projects. Prior to Accenture's acquisition of Myrtle Consulting Group, a change management and operations consulting firm, Ms. Evans served as the Chief People Officer at Myrtle Consulting Group, where she was responsible for the internal people processes to support Myrtle employees. Ms. Evans also led the team responsible for the development and delivery of the people and organization capabilities and service offerings provided to Myrtle clients. Prior to joining Myrtle, Ms. Evans was the Vice President of People and Organization at SSA & Company from January 2016 to June 2019. Her prior consulting experience also includes Hitachi Consulting, Celerant Consulting, and Ernst & Young Consulting. She also held industry roles at Eli Lilly and Company and Dell. We believe that Ms. Evans' executive record, with over 27 years of experience in operations, human resources, and personnel development, makes her a qualified candidate for the Board.
Vote Required
Each of the five nominees for director must be elected by a plurality of votes cast by holders of our common stock at the Meeting. If a quorum is present and voting at the Meeting, the five nominees receiving the highest number of "for" votes will be elected.
Votes withheld for any nominee and broker non-votes will be counted only for purposes of determining a quorum and will have no effect on this proposal.
Board Recommendation
The Board recommends that you vote all of your shares "FOR" the election to the Board of each of the nominees described in this Proposal No. 1.
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PROPOSAL NO. 2: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Background
The Audit Committee of the Board has selected Rose, Snyder & Jacobs, LLP as our independent registered public accounting firm for the fiscal year ending August 31, 2025, and has further directed us to submit the selection of RSJ as our independent registered public accounting firm for ratification by our shareholders at the Meeting. Representatives of RSJ are expected to be electronically present via phone call at the Meeting. The representatives of RSJ will have an opportunity to make a statement at the Meeting, if they so desire, and will be available to respond to appropriate questions.
Neither our governing documents nor any applicable laws require shareholder ratification of the selection of RSJ as our independent registered public accounting firm. However, the Audit Committee is submitting the selection of RSJ to our shareholders for ratification as a matter of good corporate practice. If our shareholders do not ratify the selection, the Audit Committee will reconsider its selection of RSJ and will either continue to retain the firm or appoint a new independent registered public accounting firm, in its discretion. Even if the selection is ratified, however, the Audit Committee, in its discretion, may appoint a different independent registered public accounting firm at any time during the year if it determines that such a change would be in our best interests and those of our shareholders.
Independent Registered Public Accounting Firm Fee Information
The following table sets forth the aggregate fees billed by RSJ for the services indicated for each of the last two fiscal years:
Fiscal Year Ended August 31, 2024 Fiscal Year Ended August 31, 2023
Audit Fees(1)
 $ 460,500 $ 424,500
Audit-Related Fees(2)
 $ 15,500 $ 8,510
Tax Fees(3)
 $ 3,500 $ 24,650
All Other Fees $ - $ -
Total Fees $ 479,500 $ 457,660
__________________
(1)Includes fees for (i) the audit of our annual financial statements for the fiscal years ended August 31, 2024, and 2023 included in our Annual Reports on Form 10-K, (ii) the review of our interim period financial statements for fiscal years 2024 and 2023 included in our Quarterly Reports on Form 10-Q, and (iii) related services that are normally provided in connection with regulatory filings or engagements.
(2)Includes fees related to the audit of our 401K profit share plan and other assurance services.
(3)Represents the aggregate fees billed for tax compliance related to Form 1099 and Form 3921 filings for fiscal year 2024. For the 2023 fiscal year, represents the aggregate fees billed for tax compliance prior to the Company transitioning these services to Holthouse Carlin & Van Trigt LLP.
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Audit Committee Policy Regarding Preapproval of Audit and Permissible Non-audit Services of Our Independent Registered Public Accounting Firm
The Audit Committee has adopted policies and procedures for the preapproval of all audit and non-audit services to be rendered by our independent registered public accounting firm. Under the policies and procedures, the Audit Committee generally preapproves specified services in defined categories based on estimated amounts. Preapproval may also be given as part of the Audit Committee's approval of the scope of the engagement of the independent registered public accounting firm or on a case-by-case basis for specific tasks before engagement. The Audit Committee has delegated the preapproval of services to the chair of the Audit Committee, who is required to report each preapproval to the full Audit Committee no later than its next meeting. All of the Audit Fees and Audit-Related Fees set forth in the table above were approved by the Audit Committee.
Vote Required
Approval of this Proposal No. 2 requires the affirmative "for" vote from holders of a majority of the shares of our common stock represented and voting at the Meeting. In addition, the shares voting affirmatively must equal at least a majority of the quorum that is required to conduct business at each meeting; this means that the shares voting affirmatively must be greater than 25 percent of the outstanding shares entitled to vote.
Abstentions and broker non-votes, if any, will have no effect. Brokers and other intermediaries generally will have discretionary authority to vote on this proposal because it is considered a routine matter, and, therefore, we do not expect broker non-votes with respect to this proposal.
Board Recommendation
The Board recommends a vote "FOR" the ratification of the selection by the Audit Committee of RSJ as our independent registered public accounting firm for the fiscal year ending August 31, 2025.
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PROPOSAL NO. 3: ADVISORY VOTE TO APPROVE, ON A NONBINDING BASIS, NAMED EXECUTIVE OFFICER COMPENSATION
Background
In accordance with the requirements of Section 14A of the Securities Act of 1933, as amended (which was added by the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") and the related rules of the SEC), we are providing our shareholders with the opportunity to cast a non-binding, advisory vote on the compensation of our named executive officers. This proposal, commonly known as a "say-on-pay" proposal, gives our shareholders the opportunity to express their views on the compensation of our named executive officers.
Our named executive officer compensation program is designed to attract, reward and retain the caliber of officers needed to ensure the Company's continued growth and profitability. This vote is not intended to address any specific item of compensation or any specific named executive officer, but rather the overall compensation of all of our named executive officers described in this Proxy Statement. The compensation of our named executive officers is disclosed in the section of this Proxy Statement entitled "Executive Compensation," the compensation tables, and the related narrative disclosure contained therein. We believe that our named executive officer compensation program is competitive within our industry and strongly aligned with the long-term interests of our shareholders. Our Compensation Committee regularly reviews our named executive officer compensation program to ensure that it achieves the desired goals of aligning our named executive officer compensation structure with our shareholders' interests and current market practices.
For these reasons, the Board recommends a vote in favor of the following resolution:
"RESOLVED, that the compensation paid to the Company's Named Executed Officers, as disclosed pursuant to Item 402 of Regulation S-K, including the compensation tables and narrative discussion is hereby APPROVED."
This vote is nonbinding. The Board intends to consider the outcome of the vote when making future executive compensation decisions and, in particular, to consider any significant negative voting results to the extent they can determine the cause or causes for such votes. The Board currently holds advisory votes on executive compensation on a bi-annual basis as a part of good governance practice.
We believe our executive compensation program is structured in the manner that best serves the interests of the Company and its shareholders. We encourage shareholders to read the accompanying compensation tables and the related narrative disclosures for more information about the Company's executive compensation program.
Vote Required
To be approved, on an advisory, nonbinding basis, the resolution included in this Proposal No. 3 must receive an affirmative "for" vote from holders of a majority of the shares of common stock represented and voting at the Meeting. In addition, the shares voting affirmatively must equal at least a majority of the quorum that is required to conduct business at each meeting; this means that the shares voting affirmatively must be greater than 25 percent of the outstanding shares entitled to vote.
Abstentions and broker non-votes will have no effect.
Board Recommendation
The Board recommends a vote "FOR" the approval of the compensation of our named executive officers, as disclosed in the accompanying compensation tables and the related narrative disclosure included in this Proxy Statement.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as ofDecember 17, 2024, regarding the beneficial ownership of our common stock by (a) each person known to the Company to own beneficially more than 5% of our common stock, (b) each of our directors and director nominees, (c) each of our Named Executive Officers (as defined below), and (d) all of our current directors and executive officers as a group. Information with respect to beneficial ownership is based solely on a review of our capital stock transfer records and on publicly available filings made with SEC by or on behalf of the shareholders listed below.
The percent of class is calculated based on 20,085,492 shares of our common stock outstanding as of December 17, 2024.Beneficial ownership is determined in accordance with the rules of the SEC, which generally attribute beneficial ownership of securities to persons who possess sole or shared voting or investment power with respect to those securities and for such persons includes shares of our common stock issuable to such persons pursuant to the exercise of stock options, warrants, or other securities that are exercisable or convertible into shares of our common stock within 60 days of December 17, 2024.
Beneficial owner (1) (2) Amount and Nature of Beneficial Ownership Percent of Class
Directors and Named Executive Officers
Dr. Walter S. Woltosz (3) 3,447,584 17.2 %
John DiBella (4) 150,935 *
Shawn O'Connor (5) 150,000 *
Jill Fiedler-Kelly (6) 123,517 *
Will Frederick (7) 41,875 *
Dr. John Paglia (8) 16,278 *
Dr. Lisa LaVange (9) 16,150 *
Dr. Daniel Weiner (10) 14,986 *
Sharlene Evans (11) 7,862 *
Daniel Szot (12) - *
Steven Chang (13) - *
Brett Howell (14) - *
All directors and executive officers as a group (11 persons) (15) 3,969,187 19.4 %
5% or Greater Shareholders
BlackRock, Inc. (16) 2,542,709 12.7 %
Conestoga Capital Advisors LLC (17) 2,412,465 12.0 %
The Vanguard Group (18) 1,122,469 5.6 %
*Less than 1%
(1)Unless otherwise indicated in the footnotes to the table, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown as beneficially owned by them, subject to community property laws, where applicable.
(2)The address of each director and executive officer is 800 Park Offices Drive, Research Triangle Park, NC 27709.
(3)Consists of 3,442,584 shares of common stock and 5,000 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024. The common shares are held jointly with Ms. Virginia Woltosz, Dr. Woltosz's spouse and cofounder of the Company.
(4)Consists of 79,840 shares of common stock and 71,095 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
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(5)Consists of 0 shares of common stock and 150,000 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
(6)Consists of 68,867 shares of common stock and 54,650 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
(7)Consists of 2,100 shares of common stock and 39,775 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
(8)Consists of 5,278shares of common stock and 11,000 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
(9)Consists of 7,150 shares of common stock and 9,000 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
(10)Consists of 7,986 shares of common stock and 7,000 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
(11)Consists of 7,862 shares of common stock and 0 shares of common stock underlying stock options exercisable within 60 days of December 17, 2024.
(12)Mr. Szot does not beneficially own any shares of common stock as of December 17, 2024.
(13)Mr. Chang does not beneficially own any shares of common stock as of December 17, 2024.
(14)Consists of 0 shares of common stock and 0shares of common stock underlying stock options exercisable within 60 days of December 17, 2024. Dr. Howell previously served as Business Unit President, Quantitative Systems Pharmacology. He departed from the Company on August 30, 2024.
(15)Consists of the shares described in Notes (3) through (13) above, less the 0 shares of common stock held by Dr. Howell, whose employment with us terminated on August 30, 2024.
(16)Consists of 2,542,709shares of common stock, based upon information contained in a Schedule 13G/A filed by BlackRock, Inc. on January 23, 2024. The address of BlackRock, Inc. is 55 East 52ndStreet, New York, New York 10055.
(17)Consists of 2,412,465 shares of common stock, based upon information contained in a Schedule 13G/A filed by Conestoga Capital Advisors LLC and its affiliate on January 5, 2024. The address of Conestoga Capital Advisors LLC is 550 E. Swedesford Rd. Ste 120 Wayne, PA 19087.
(18)Consists of 1,122,469shares of common stock, based solely upon information contained in a Schedule 13G/A filed by The Vanguard Group on February 13, 2024. The address of The Vanguard Group is 100 Vanguard Blvd. Malvern, PA 19355.
The Company has adopted certain policies with respect to the ownership of stock by the Board of Directors, including an Insider Trading Policy. As of August 31, 2024, to management's knowledge, all members of our Board were in compliance with these policies.
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Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires certain of our executive officers and directors, and persons who beneficially own more than 10% of a registered class of our equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of our common shares and other equity securities, on Forms 3, 4 and 5 respectively. Such executive officers, directors and greater than 10% shareholders are required by the SEC regulations to furnish us with copies of all Section 16(a) reports they file. Based on our review of the copies of such forms received by us, and to the best of our knowledge, all such executive officers, directors, and persons holding greater than 10% of our issued and outstanding stock filed all of the required reports in a timely manner during fiscal year 2024, other than (i) Mr. Frederick, who filed one late Form 4, and (ii) Mr. Chang, who filed one late Form 4.
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BOARD MATTERS AND CORPORATE GOVERNANCE
Information Regarding the Board and its Committees
The Board met nine timesduring the fiscal year ended August 31, 2024. Each member of the Board attended100%of the aggregate number of meetings of the Board and of the committees of the Board on which he or she served that were held during the period for which he or she was a director or committee member, respectively.
The Board has three committees: Audit Committee, Compensation Committee, and Nominating & Corporate Governance Committee. The following table provides information for the current membership for each of the committees of the Board:
Name Audit Committee Compensation Committee Nominating & Corporate Governance Committee
Dr. Daniel Weiner X X
Dr. Walter Woltosz X
Dr. John K. Paglia Chair X X
Dr. Lisa LaVange X X Chair
Sharlene Evans X Chair X
Below is a description of each committee of the Board. The Board has determined that each member of each committee, and each member of the Board, is "independent" within the meaning of the applicable listing standards of the Nasdaq Stock Market, as well as applicable SEC rules and regulations, and that each member is free of any relationship that would interfere with his or her individual exercise of independent judgment with regard to the Company.
Audit Committee
The Audit Committee has been established in accordance with Section 3(a)(58)(A) of the Exchange Act and bears direct responsibility for the appointment and termination, compensation, and oversight of the work of our independent registered public accounting firm, who reports directly to the Audit Committee. The Audit Committee operates pursuant to a charter that is available in the "Investors" section of our corporate website at www.simulations-plus.com, under "Investors - Shareholder Information." The Audit Committee has received written disclosures and the letter from our independent registered public accounting firm pursuant to the applicable requirements of the Public Company Accounting Oversight Board ("PCAOB") regarding the independent auditor's communications with the Audit Committee concerning independence, and the Audit Committee has discussed with the independent accountant the independent accountant's independence. The Audit Committee oversees cybersecurity measures, ensuring robust protection of our digital assets and information infrastructure. The Audit Committee also reviews and discusses with our management and independent registered public accounting firm the financial statements and disclosures in our quarterly financial press releases and SEC filings. Audit Committee members periodically meet separately with our management and independent registered public accounting firm to discuss issues and concerns, and the Audit Committee has established procedures for the receipt, retention, and treatment of complaints received by us regarding accounting, internal accounting controls, or audit matters, in a confidential manner.
The Board has determined that Dr. Paglia qualifies as an "audit committee financial expert" in accordance with applicable SEC rules and as "independent" under the applicable Nasdaq listing standards. For a description of Dr. Paglia's relevant experience, please refer to Dr. Paglia's biography set forth above in the section above entitled "Proposal No. 1: Election of Directors."
The Audit Committee met four times during the fiscal year ended August 31, 2024.
Audit Committee members during fiscal year 2024:
Dr. John K. Paglia (Chair)
Dr. Lisa LaVange
Sharlene Evans
Dr. Daniel Weiner
Audit Committee Report
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The Audit Committee oversees the Company's financial reporting process on behalf of our Board. Management has the primary responsibility for the financial statements and the reporting process, including the systems of internal controls. In fulfilling its oversight responsibilities, the Audit Committee reviewed the audited financial statements in the Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2024, with management, including a discussion of any significant changes in the selection or application of accounting principles, the reasonableness of significant judgments, the clarity of disclosures in the financial statements, and the effect of any new accounting pronouncements.
The Audit Committee reviewed with RSJ, which is responsible for expressing an opinion on the conformity of the Company's audited financial statements with generally accepted accounting principles, its judgments as to the quality, not just the acceptability, of the Company's accounting principles and such other matters as are required to be discussed with the Audit Committee under generally accepted auditing standards and the matters listed in PCAOB Auditing Standard No. 1301, Communications with Audit Committees. In addition, the Audit Committee has discussed with RSJ its independence from management and the Company, has received from RSJ the written disclosures and the letter required by applicable requirements of the PCAOB regarding RSJ's communications with the Audit Committee concerning independence, and has considered the compatibility of non-audit services with the auditors' independence.
The Audit Committee met with RSJ to discuss the overall scope of its services, the results of its audit and reviews, and the overall quality of the Company's financial reporting. RSJ, as the Company's independent registered public accounting firm, also periodically updates the Audit Committee about new accounting developments and their potential impact on the Company's reporting. The Audit Committee's meetings with RSJ were held with and without management present. The Audit Committee is not employed by the Company, nor does it provide any expert assurance or professional certification regarding the Company's financial statements. The Audit Committee relies, without independent verification, on the accuracy and integrity of the information provided, and representations made, by management and the Company's independent registered public accounting firm.
In reliance on the reviews and discussions referred to above, the Audit Committee has recommended to the Board that the audited financial statements of the Company be included in its Annual Report on Form 10-K for the year ended August 31, 2024 (the "Annual Report"). The Audit Committee and the Board also have recommended, subject to shareholder approval, the ratification of the appointment of RSJ as the Company's independent registered public accounting firm for the fiscal year ending August 31, 2025.
This report of the Audit Committee is not "soliciting material," shall not be deemed "filed" with the SEC and shall not be incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, except to the extent that we specifically incorporate this information by reference, and shall not otherwise be deemed filed under such acts.
The foregoing report has been furnished by the Audit Committee.
Respectfully submitted,
The Audit Committee of the Board of Directors:
Dr. John K. Paglia (Chair)
Dr. Lisa LaVange
Dr. Daniel Weiner
Sharlene Evans
Nominating & Corporate Governance Committee
The Nominating & Corporate Governance Committee makes recommendations to the Board regarding candidates for election to the Board, as well as the composition and size of the Board and its committees and qualifications for membership. In connection with performing their duties, the members of the Nominating & Corporate Governance Committee are fully empowered to engage one or more search firms to identify potential director candidates. The Nominating & Corporate Governance Committee is also charged with recommending the appointment of new directors to our Board, committee structure and membership, director compensation, and Named Executive Officer, including Chief Executive Officer, succession planning.
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The Nominating & Corporate Governance Committee provides instructions in each annual proxy statement regarding how shareholders can make director nominations. The Nominating & Corporate Governance Committee does not have a formal policy for consideration of any director candidates recommended by shareholders, including the minimum qualifications for director candidates, as, to date, the Nominating & Corporate Governance Committee has not received a recommendation from a shareholder; however, any such nomination, if received, would be considered on an equal basis with candidates identified by the Nominating & Corporate Governance Committee. The Nominating & Corporate Governance Committee has not typically used any third party to identify, evaluate, or assist in identifying and/or evaluating potential nominees and to date has not paid any fee to any third party for such services. However, at the sole discretion of the Nominating & Corporate Governance Committee, a third-party consultant may be engaged at an appropriate fee, to help evaluate such candidates for membership to the Board. The Nominating & Corporate Governance Committee operates pursuant to a charter that is available in the "Investors" section of our corporate website at www.simulations-plus.com, under "Investors - Shareholder Information."
The Nominating & Corporate Governance Committee oversees Environmental, Social, and Governance ("ESG") practices, fostering a commitment to sustainability and ethical standards within our organization. On March 28, 2024, the Nominating & Corporate Governance Committee updated the Simulations Plus, Inc. Guiding Principles of Corporate Governance (the "principles of corporate governance"), that applies to our Board of Directors, Audit Committee, Compensation Committee, and Nominating & Corporate Governance Committee. The principles of corporate governance are publicly available at https://www.simulations-plus.com/wp-content/uploads/Guiding-Principles-of-Corp-Goverance-Updated-03_28_24.pdf.
The Nominating & Corporate Governance Committee met five times during the fiscal year ended August 31, 2024.
Nominating & Corporate Governance Committee members during fiscal year 2024:
Dr. Lisa LaVange (Chair)
Dr. Daniel Weiner
Dr. John K. Paglia
Sharlene Evans
Compensation Committee
The Compensation Committee administers our executive compensation program and is responsible for establishing, implementing, and monitoring adherence to our philosophy with respect to executive compensation. The Compensation Committee is responsible for reviewing and making recommendations regarding the compensation of our Chief Executive Officer, as well as reviewing the compensation of other executive officers. The Compensation Committee serves as the administrative committee of the Company's equity incentive plans and advises the Board on other incentive compensation plans and equity-based plans. The Compensation Committee has the sole authority to retain and terminate compensation consultants, independent legal counsel, and other advisers, and has sole authority to approve any such consultant's and/or advisor's fees associated with their duties. The Compensation Committee operates pursuant to a charter that is available in the "Investors" section of our corporate website at www.simulations-plus.com, under "Investors - Shareholder Information."
The Compensation Committee met five times during the fiscal year ended August 31, 2024.
Compensation Committee members during fiscal year 2024:
Dr. Daniel Weiner (Chair)
Dr. Lisa LaVange
Sharlene Evans
Dr. John K. Paglia
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Compensation Committee Report
The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis disclosures contained in this Proxy Statement. Based on this review and discussion, the Compensation Committee has recommended to the Board, and the Board has agreed, that the section entitled "Compensation Discussion and Analysis," as it appears below be included in this Proxy Statement and incorporated by reference into Simulation Plus, Inc.'s Annual Report on Form 10-K for the fiscal year ended August 31, 2024.
The foregoing report has been furnished by the Compensation Committee.
Respectfully submitted,
The Compensation Committee of the Board of Directors:
Dr. Daniel Weiner (Chair)
Dr. Lisa LaVange
Sharlene Evans
Dr. John K. Paglia
Compensation Committee Interlocks and Insider Participation
None of the members of our Compensation Committee during fiscal 2024, or as of the date of this Proxy Statement, is or has been an officer or employee of the Company, has had any relationship with the Company required to be disclosed as a related person transaction, and none of our executive officers served on the compensation committee (or other committee serving an equivalent function) or board of any company that employed any member of our Compensation Committee or our Board during fiscal year 2024.
Board Diversity Matrix
The following diversity matrix provides information regarding the members of our Board, including certain types of knowledge, skills, experiences, and attributes possessed by one or more of our directors which our Board believes are relevant to our business and industry. The matrix does not encompass all of the knowledge, skills, experiences, or attributes of our directors, and the fact that a particular knowledge, skill, experience or attribute is not listed does not mean that a director does not possess it. In addition, the absence of a particular knowledge, skill, experience, or attribute with respect to any of our directors does not mean the director in question is unable to contribute to the decision-making process in that area. The type and degree of knowledge, skill, and experience listed below may vary among the members of the Board.
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Dr. Daniel Weiner Dr. Walter Woltosz Dr. John K. Paglia Dr. Lisa LaVange Sharlene Evans
Executive Leadership
CEO Experience X X
CTO/R&D Experience X X
Other C-Level Experience X X X X
Industry Background
Academia X X X X
Pharmaceutical/Biotech X X X
Pharma Services/Technology X X X
Technology (IT/Software/Cybersecurity) X
Knowledge, Skills and Experience
Accounting and Financial Audit X X X X X
Corporate Governance/Ethics X X X X X
Cybersecurity X X X X
Finance/Financial Literacy X X X X X
Human Capital Management X X X X X
Investor Relations X X X X X
Marketing X X X X X
Mergers & Acquisitions X X X X X
Operations X X X X X
Public Company Board X X X X X
Sales X X X X X
Scientific Consulting X X X X X
Strategy and Strategic Planning X X X X X
Demographics
Race/Ethnicity
African American X
Asian/Pacific Islander
White/Caucasian X X X X
Hispanic/Latino
Native American
Gender
Male X X X
Female X X
Board Tenure
Years 7 28 10 5 3
Key Metrics regarding directors are as follows:
•Average age is 68.
•40% have been on the Board for less than six years.
•40% are women.
•20% are racially/ethnically diverse.
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Board, Committee, and Director Evaluations
During fiscal year 2024, the Nominating & Corporate Governance Committee engaged Nasdaq as a third-party service provider to carry out a board evaluation process. The evaluation process was designed to facilitate ongoing, systematic examination of the Board's effectiveness and accountability, and to identify opportunities for improving its operations and procedures. The 2024 board evaluation process included the following:
•Board assessment: Each director completed a questionnaire assessing the performance of the Board in overseeing strategy and relationship management; succession planning and human capital management; ethics, risk, financial monitoring and crisis control; and performance and compensation, as well as the effectiveness of Board processes.
•Committee assessments: Each of the three Board Committees was also evaluated. Each member of each committee completed a questionnaire assessing the committee's effectiveness, composition, culture, and administration.
•Board Member and Executive Team Interviews: Board members and selected executive team members were interviewed by the Nasdaq to further discuss the effectiveness of the Board and the working relationship amongst Board and executive team members.
•Director skills self-assessment: Additionally, each director independently completed a skills self-assessment.
The Board views this evaluation process as a means of increasing shareholder value by enhancing the Board's contributions to the Company.
Board Leadership Structure
The Company's former Board Chair, Dr. Walter Woltosz, served as Chief Executive Officer until June 26, 2018. However, effective December 17, 2024, Dr. Daniel Weiner transitioned from our Lead Independent Director to Board Chair, and at his request, Dr. Walter Woltosz transitioned from Board Chair to Director, resulting in an elimination of the Lead Independent Director role. Our current Chief Executive Officer and Board Chair roles are separate.
The Company's Corporate Governance Guidelines provide the Board with flexibility to determine the appropriate Board leadership structure at any time. The Nominating & Corporate Governance Committee (consisting entirely of independent directors) regularly reviews the leadership structure, and considers many factors, including the specific needs of the Company, corporate governance best practices, shareholder feedback, and succession planning, as we believe that different structures may be appropriate in different circumstances. Effective October 17, 2024, Dr. Daniel Weiner transitioned from Lead Independent Director, a role he has held since October 20, 2022, to Board Chair. Dr. Walter Woltosz transitioned from Board Chair to Director, resulting in an elimination of the Lead Independent Director role. We believe our leadership structure is appropriate for the size and scope of operations of a company of our size.
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Board's Role in Risk Management
The Board is responsible for oversight of risks facing the Company, while our management is responsible for day-to-day management of risk. The Board satisfies this responsibility through reporting by each committee regarding the committee's considerations and actions, as well as through regular reports directly from officers responsible for oversight of particular risks within our company. The Board as a whole directly oversees our strategic and business risk, including, but not limited to, risks related to the following:
•accounting and financial reporting, internal controls and financial statement audits, compliance with legal and regulatory requirements
•compensation practices and management succession planning
•board composition
•product developments
•diversity, equity, and inclusion ("DEI")
•information technology and cybersecurity
•corporate social responsibility ("CSR")
•ESG, including climate risks and human rights
The Board as a whole is responsible for risk oversight. Our Chief Executive Officer and executive team are responsible for assessing and managing risks facing the Company day-to-day, with members of the Board providing oversight of such risk management.
The Board is committed to understanding, monitoring, and managing ESG factors to support the Company's sustainable growth. The Board, through its Nominating & Corporate Governance Committee, reviews the overall adequacy of, and provides oversight with respect to, the Company's DEI, CSR, and ESG strategies, initiatives, and policies, including communications with employees, investors, and other stakeholders of the Company with respect to such matters. The Nominating & Corporate Governance Committee periodically provides reports to the Board on DEI, CSR, and ESG matters. Additionally, the Company has formed an ESG Steering Committee, which is chaired by the Chief Financial Officer and comprised of representatives from multiple departments. The ESG Steering Committee is designed to identify and implement desired changes in the Company's ESG practices and to monitor global developments in each ESG pillar.
Environmental, Social, Governance
We are committed to providing consistent and excellent retuto our shareholders, all while maintaining a strong sense of good corporate citizenship that places a high value on the welfare of our employees, the communities in which we operate, and the world as a whole. We believe that effectively prioritizing and managing our Environmental, Social, and Governance ("ESG") factors will help create long-term value for our investors. We also believe that transparently disclosing the goals and relevant metrics related to our ESG programs will allow our stakeholders to be informed about our progress.
The topics covered in this section are identified through third-party ESG reporting frameworks, standards and metrics, such as the Sustainability Accounting Standards Board ("SASB"), and United Nations Sustainable Development Goals ("SDGs"). More information regarding our key ESG programs, goals and commitments, and key metrics can be found on our website and within our 2023 ESG Update available at https://www.simulations-plus.com/investorscorporate-profile/2023-esg-at-a-glance/, 2022 ESG Update available at https://www.simulations-plus.com/investorscorporate-profile/esg-overview/, and 2020 ESG Report available at https://www.simulations-plus.com/wp-content/uploads/SLP_2020-ESG-Report-2.pdf.
Our ESG highlights include the following:
Environmental Matters
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We participate in recycling programs through local waste management facilities to divert all recyclable materials away from landfills, including but not limited to bottles, cans, plastics, paper, and cardboard. Our electronic waste is sent to approved local e-waste recycling centers. We have a policy of using IT hardware vendors that embrace environmental sustainability. We continue in our commitment to remote work; with most employees working from home, which reduces emissions from commuting to workplaces. As part of our ongoing commitment to environmentally sustainable business operations, we recently consolidated the servers in our U.S. offices into our existing colocation facility to reduce energy usage and our carbon footprint. As a result, our energy usage was reduced by 75% compared to the prior year.
Greenhouse Gas Emission:
Scope:
Scope 1: Scope 1 covers direct greenhouse gas ("GHG") emissions that occur from sources that are controlled or owned by an organization (e.g., emissions associated with fuel combustion in boilers, furnaces, and vehicles).
Scope 1 is not applicable to our organization as it does not own or control any sources that produce direct GHG emissions.
Scope 2: Guidance standardizes how corporations measure emissions from purchased or acquired electricity, steam, heat, and cooling (called "scope 2 emissions").
We have identified electricity as our source that produces GHG scope 2 emissions.
Scope 3: Scope 3 encompasses emissions that are not produced by the company itself and are not the result of activities from assets owned or controlled by them, but by those entities with which it engages up and down its value chain. An example of this is when we buy, use, and dispose of products from suppliers. Scope 3 emissions include all sources not within the scope 1 and 2 boundaries.
We believe that we do not produce GHG emissions that fall within Scope 3.
We believe we are in compliance in all material respects with all applicable environmental laws. Presently, we do not anticipate that such compliance will have a material effect on capital expenditures, earnings, or competitive position with respect to any of our operations.
Social Impact and Supporting our Communities
Our People
•Our commitment to our people lies in our continued efforts to support and value our most important asset - our employees.
•We conduct an annual employee engagement survey to ensure cultural alignment and success of internal programs and to further support our employees' needs.
•We have a paid parental leave program to support working parents and a recognition system to encourage peer- to-peer and leader-to-employee recognition.
•We also ensure that all our employees have the opportunity to attend in-person employee events to collaborate face-to-face with their colleagues around the globe.
•We continue to provide supplemental benefits to our health benefit offerings, and have increased our focus on physical and mental wellness with all our teams through an online wellness challenge hosted by the Company.
•We continue to engage with our employees and listen to their feedback in order to work toward building a culture of trust, collaboration, and transparency.
•We conducted a compensation benchmarking study with an external compensation consultant, and have made efforts to better align our compensation practices with market salary ranges.
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Customer Privacy & Data Security
•We value customer privacy, and we endeavor to collect data only to the extent needed to deliver company information, software products, and consulting services. Our website includes a copy of our comprehensive Privacy Notice, which details what and how data are collected, how data are used and stored, and the options for controlling personal data, including opting out, accessing, updating, or deleting it.
•In recognition of the critical importance of data security to our operations, including cybersecurity, data protection, and customer privacy, our leadership team conducts a thorough examination of all elements of data security. Our objective is to ensure the security, confidentiality, and privacy of our systems and information assets, and to follow and be compliant with all applicable laws, regulations, and guidelines, including, but not limited to:
◦U.S. and State data privacy laws
◦The EU's General Data Protection Regulation (the "EU GDPR")
◦The UK Data Protection Act 2018 (the "UK GDPR")
◦Pharmaceutical Good Practice Quality Guidelines, including FDA 21 CFR Part 11
◦The Sarbanes-Oxley Act
◦The Personal Information Protection Law of the People's Republic of China ("PIPL")
•Our corporate-level IT department provides consistency, efficiency, and functional IT support across all business units. Our IT department is responsible for centralizing business-unit-driven data processing, storage, and backup capabilities at each of our geographical locations. Our Quality and Compliance department is also responsible for ensuring that corporate IT policies are aligned and compliant with all applicable regulatory provisions and current best practices.
•We have engaged a third-party consulting firm, VeraSafe, as our Data Protection Officer ("DPO"). The DPO is responsible for ensuring that we have a Personal Data Protection program in place that is compliant with data privacy laws such as the EU GDPR, UK GDPR, China's PIPL, and data privacy laws enacted at the state level, as applicable to us. Our corporate Personal Data Protection program includes policies, practices, and training directed to protecting personal data.
Business Ethics
•From the Company's inception, we have placed a strong emphasis on conducting our business with honesty and integrity. High ethical standards are expected of management and employees alike, and we continuously strive to create a corporate culture of honesty, integrity, and trust. Throughout our operations and in our dealings with our stakeholders, we endeavor to engender the confidence that the Company's conduct is beyond reproach.
•The policies we have developed are intended to:
◦Define and disseminate our core values and the legal requirements applicable to good business conduct and ethical behavior.
◦Offer guidance in understanding Company policies, interpreting laws, and handling Company-related issues and situations.
◦Foster clear, ethical behaviors and conduct to create an atmosphere of respect, trust, cooperation, and collaboration throughout the Company and its activities.
◦Provide clear and well-defined procedures by which employees can easily obtain information, ask questions, and, if necessary, report any suspected violations of any of our Business Ethics policies.
•In addition to abiding by all applicable laws, all management and employees are required to comply fully with our Code of Conduct, which sets forth the Company's values, business culture, and practices. The Code of Conduct also governs conduct between our employees and our customers and vendors with whom we do business. Because many of our customers are companies in the pharmaceutical and biotech industries, we have incorporated in our Code of Conduct the principles of the Pharmaceutical Supply Chain Initiative, including Leadership, Partnering, Presence, Consistency & Quality, Learning, and Innovation & Discovery.
Human Rights
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•The Company was founded on the belief that our software technologies could lead to important advances in healthcare, thereby improving patient outcomes, advancing and improving global health, and bettering the lives of humankind. This objective cannot be accomplished without a commitment to human rights, and we are committed to ensuring that, in our day-to-day business practices, in our business relationships, and in matters of employment, we will uphold our own principles as delineated in our Code of Conduct. Furthermore, we support the principles set forth in the United Nations International Bill of Human Rights, specifically the Universal Declaration of Human Rights, and the ILO Declaration on Fundamental Principles and Rights at Work and have a written Human Rights Policy to uphold these commitments. As we evolve this policy, we will look to the UN Guiding Principles on Business and Human Rights ("UNGPs") for guidance.
Governance
•We are committed to ensuring strong corporate governance practices on behalf of our shareholders and other stakeholders. We believe strong corporate governance provides the foundation for financial integrity and shareholder confidence. Our Board is responsible for the oversight of risks facing the Company, while our management is responsible for the day-to-day management of risk. The Board has three committees: Audit Committee, Compensation Committee, and Nominating & Corporate Governance Committee. The Board, as a whole, directly oversees our strategic and business risk, including risks related to financial reporting, compensation practices, cybersecurity, ESG, and product developments. In addition, all our employees, contractors, and vendors are required to follow our Code of Conduct as a part of our good governance practice. Our Board is gender and racially diverse. Our ESG steering committee oversees and executes matters related to ESG.
Human Capital Resources
We are committed to our people, and embrace a culture of engagement, empowerment, and equity. Over 98% of our global employees are employed full-time, and more than 68% work within our life sciences software or consulting business units. Given the specialized nature of our business, candidates for our open positions are strategically selected for their unique education and skills. The majority of our employees have advanced degrees, with over 65% of our technical and scientific staff holding doctoral degrees in mathematics, chemistry, biomedical engineering, and/or the pharmaceutical sciences.
As of August 31, 2024, we employed a total of 247 persons, including 243 full-time employees and 4 part-time employees.
We believe that our continued success depends on our ability to continue to attract, hire, and retain qualified personnel. To support the endeavor, we have continued to focus heavily on our total rewards program, which includes components of compensation, health and wellness benefits, training, time off, recognition, and support for business travel. Over the past year, the Company was recognized by Comparably as Best Company for Diversity, Best Company for Women, Best Company Culture, and a Best Company Compensation awards winner, as determined based on direct feedback from our employees. We had a voluntary turnover rate of less than 4% during fiscal year 2024, further exemplifying our good relations with employees.
Diversity, Equity, and Inclusion
We embrace diversity with the knowledge that it can lead to greater innovation, and in our workplace, we foster inclusion, so all employees feel they are a part of our team with equal access to all opportunities. One of our goals is to always continue expanding our focus on diversity, equity, and inclusion. In terms of gender equity, women currently comprise 48% of our workforce and 47% of our scientific staff. Our ADP Workforce Now platform allows us to access and better understand trends in our staff and hiring relative to diversity. We regularly track our metrics to ensure we are aligning our recruitment efforts and continue to refine our policies and benefits to be inclusive of all employees. We continue to pay parental leave to all employees for birth or adoption, and have a flexible time off and remote-first work culture that supports the ability to work globally and allows us to hire the best fit for the role regardless of location.
Compensation, Training, and Awareness Programs
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We continue to refine career paths for the different functions within our organization. We use these career paths as a basis for promoting employee career development and growth within the organization, as well as in recruiting and hiring new talent. We have implemented a new performance platform within our ADP Workforce Now system that allows for better performance management processes. We plan to use the features to continue to focus on performance, goal tracking, and succession planning as part of our future personnel growth strategies.
This past year, we implemented a training program that allowed all employees access to company-paid technical, leadership or skills training opportunities in an area that they selected with management support. In the coming year, we intend to focus even more training efforts on leadership development. In addition to these recently implemented employee training and development initiatives, we continue to offer an ongoing program of cross-specialty training consisting of presentations by expert modelers from each business unit. These monthly sessions serve to familiarize all business units with the applications and techniques unique to each business unit and, in so doing, create opportunities to find synergies, and cross-selling opportunities, to expand the knowledge base across all business units, to identify cross-selling opportunities, and to build a shared sense of purpose.
Health & Safety
We place a high value on maintaining a clean, safe, and healthy environment for our employees. Our Human Rights Policy confirms our commitment to basic human rights worldwide and our Code of Conduct requires our employees and vendors to work within our established principals of ethics.
The well-being of our employees, whether they are working in our offices or remotely from home offices, is one of our highest priorities. We believe that we are substantially in compliance with all applicable laws, regulations, and standards, and we make every reasonable effort to be attentive and responsive to our employees' needs. We continue to provide very competitive health and wellness benefits, and each year we host a wellness challenge for all employees with monetary incentives to encourage a healthy and less sedentary lifestyle. We also host regular "coffee breaks" to encourage, even in a remote environment, interacting with colleagues outside of work meetings or topics.
We also consider open and transparent channels of communication to be a critical component of our employee health and wellness program. Toward this end, on a quarterly basis, we hold a company-wide virtual meeting to keep our employees engaged, informed, and apprised of activities occurring at the Company and within each business unit, including quarterly financial results, future goals, and notable milestones.
Shareholder Communications with the Board
We have not adopted a formal process for shareholder communications with the Board. However, any shareholder comments and communications received by the Company are forwarded to the Board or the Nominating and Corporate Governance Committee Chair, as applicable, and appropriate responses are provided to shareholders in a timely manner. We believe that these informal communication efforts have proven effective and obviate the need for any formal process. Although we do not have a formal policy, members of the Board are encouraged to attend annual meetings of our shareholders. All of our directors except Sharlene Evans attended the annual meeting of shareholders held in February 2024.
Code of Conduct
The Company has adopted a Code of Conduct that applies to our directors, officers, and employees that is available in the "Investors" section of our corporate website at www.simulations-plus.com under "Investors - Shareholder Information."
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions with Related Persons.
We have not entered into any transactions with any of our directors, nominees for director, officers, or principal shareholders, nor any associate or affiliate of the foregoing, and we are not currently considering any proposed transactions with such related persons in which we are, or plan to be, a participant and the amount involved exceeds $120,000 at the end of fiscal year 2024, and in which any such related person had or will have a direct or indirect material interest.
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Review, Approval, or Ratification of Transactions with Related Persons.
We have not adopted any formal procedures for the review, ratification, or standards for approval, of related-party transactions, but instead review such transactions on a case-by-case basis.
Interest of Certain Persons in Matters to be Acted Upon
Other than with respect to the election of directors, none of our directors, nominees for director, executive officers, any person who has served as a director or executive officer since the beginning of the last fiscal year, or their associates have any interest, direct or indirect, by security holdings or otherwise, in any of the matters to be acted upon at the Meeting as described in this Proxy Statement.
DIRECTOR COMPENSATION
Non-Employee Director Compensation Policy
Our Board has adopted a non-employee director compensation policy that is designed to provide a total compensation package that enables us to attract and retain, on a long-term basis, high caliber non-employee directors.
We also reimburse our directors for reasonable out-of-pocket expenses in connection with the attendance at the Board and committee meetings. Mileage expense to attend meetings is reimbursed at the Internal Revenue Service defined rate for business use.
During fiscal year 2024, the Company's non-executive directors were entitled to receive the following compensation for services rendered to the Company:
Each non-executive director was entitled to $165,000 in compensation annually, of which $120,000 was in the form of stock grants and $45,000 was in the form of a cash stipend. Members of the Board's committees were also entitled to receive an additional cash stipend of $7,500 for each committee they were a member of, which was paid on a quarterly basis.
The Company also paid an additional annual cash stipend to each of the chairs of the Board's committees, as follows:
•Board Chair, $35,000
•Audit Committee Chair, $20,000
•Compensation Committee Chair, $15,000
•Nominating & Corporate Governance Committee Chair, $10,000
On October 17, 2024, the Compensation Committee conducted an annual review of director compensation. Following such review and at the Compensation Committee's recommendation, the overall compensation of the Company's non-executive directors was temporarily reduced by 10% to align with other annual company expense reduction initiatives and the $15,000 Lead Independent Director cash stipend was removed for fiscal year 2025 (concurrent with the elimination of the Lead Independent Director position).
To further align the interests of our directors with the interests of our shareholders, in October 2022 the Board adopted equity ownership guidelines applicable to our directors. These guidelines require directors to own three times the annual cash retainer within five years of appointment to the Board. The Board has the full power to administer and interpret the equity ownership guidelines.
In calculating equity ownership level, the following shares and equity rights shall be included: outstanding shares of common stock that are not pledged, vested in-the-money stock options, and any other vested equity grants or account balances under the Company's equity incentive plans.
The ownership requirement will be measured for each director as of August 31st of each year. Our current directors are required to achieve the applicable ownership requirement by August 31, 2027. Following the conclusion of a phase-in period applicable to a director, in the event that such individual does not satisfy the ownership requirement as of any measurement date, the Board may implement such conditions, restrictions, or limitations on such individual as the Board determines to be necessary or appropriate in order to achieve the purpose of the guidelines.
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Director Compensation Table
The table below shows all compensation awarded to, earned by or paid to our non-employee directors during the fiscal year 2024:
Name of Director Fiscal Year Fees earned or paid in cash ($) Option Awards ($) Stock Awards ($) All other compensation ($) Total ($)
(a) (b) (c) (d)
Dr. Daniel Weiner 2024 90,000 - 120,071 - 210,071
Dr. Walter Woltosz 2024 80,000 - 120,071 - 200,071
Dr. John K. Paglia 2024 80,000 - 120,071 - 200,071
Dr. Lisa LaVange 2024 70,000 - 120,071 - 190,071
Sharlene Evans 2024 67,500 - 120,071 - 187,571
__________________
(a)Represents annual stipend and per meeting fees described above.
(b)No options were awarded to our non-employee directors during fiscal year 2024.
(c)As of August 31, 2024, the aggregate number of shares subject to outstanding stock options and stock awards held by each of our non-employee directors was as follows:
Director Number of Shares Subject to Option Awards Number of Shares Subject to Stock Awards
Dr. Daniel Weiner 7,000 -
Dr. Walter Woltosz 5,000 -
Dr. John K. Paglia 11,000 -
Dr. Lisa LaVange 9,000 -
Sharlene Evans - -
(d)Represents stock grants issued to our independent directors as compensation, as described above.
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EXECUTIVE COMPENSATION AND OTHER INFORMATION
At the beginning of fiscal year 2024, the Company reorganized its internal structure to create a more integrated and cohesive operating platform based on key product and services offerings rather than separate divisions based on its prior acquisitions. This business unit restructuring is engendering greater scientific collaboration and knowledge sharing within the Company that we expect will lead to identifying new opportunities that both advance the Company's business objectives and deepen client relationships. Continuing with our strategic plan of aligning our business units around products and services, the Pro-ficiency acquisition resulted in two new business units, Adaptive Learning & Insights and Medical Communications, giving the Company six business units that include:
•Cheminformatics ("CHEM");
•Physiologically Based Pharmacokinetics ("PBPK");
•Clinical Pharmacology and Pharmacometrics ("CPP");
•Quantitative Systems Pharmacology ("QSP");
•Adaptive Learning & Insights ("ALI"); and
•Medical Communications ("MC").
Executive Officers
The following table sets forth the names, ages, and positions of our executive officers as of December 23, 2024. There are no arrangements, agreements, or understandings between nonmanagement security holders and management under which nonmanagement security holders may directly or indirectly participate in or influence the management of our affairs. There are no arrangements or understandings between any executive officer and any other person pursuant to which any executive officer was or is to be selected as an executive officer, as applicable. To our knowledge, there currently are no legal proceedings, and during the past ten years there have been no legal proceedings, that are material to the evaluation of the ability or integrity of any of our executive officers.
NAME AGE POSITIONS WITH THE COMPANY OFFICER SINCE
Shawn O'Connor 65 Chief Executive Officer 2018
Will Frederick 61 Chief Financial Officer & Chief Operating Officer 2020
Daniel Szot 55 Chief Revenue Officer 2024
John A. DiBella 45 President, PBPK / Cheminformatics Solutions 2012
Jonathan Chauvin 42 Co-President, Clinical Pharmacology & Pharmacometric Services 2020
Jill Fiedler-Kelly 56 Co-President, Clinical Pharmacology & Pharmacometric Services 2021
Steven Chang 56 President, Quantitative Systems Pharmacology Solutions 2024
Jenna Rouse 49 President, Adaptive Learning & Insights 2024
Murry Alper 54 President, Medical Communications 2024
Set forth below is biographical information regarding each of our current executive officers.
SHAWN O'CONNOR joined the Company in June 2018 as our Chief Executive Officer. Mr. O'Connor has more than 31 years of experience in high technology executive management. From 2011 to 2018, Mr. O'Connor was Chief Executive Officer, President, and a director of Entelos Holding Corp., a provider of unique quantitative systems pharmacology software and services to the pharmaceutical drug development market. From 2002 to 2009, Mr. O'Connor served as Chief Executive Officer, President, and Chairman of Pharsight Corporation, a developer and marketer of software products and services that help pharmaceutical and biotechnology companies improve their decision-making in drug development and commercialization. From 1995 to 2000, Mr. O'Connor was with QRS Corporation in various positions including Chief Financial Officer and President and Chief Operating Officer. From 1988 to 1994, Mr. O'Connor was with Diasonics, Inc., serving in various positions including Chief Financial Officer. Mr. O'Connor earned a Bachelor of Science in business administration from the University of California at Berkeley and completed the Executive Education Program at Stanford University Graduate School of Business.
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WILL FREDERICK serves as our Chief Financial Officer, Chief Operating Officer, and Secretary, and joined the Company in December 2020. Mr. Frederick brings more than 26 years of financial leadership experience to the Company. He has a proven track record of developing and implementing strategies to drive revenue growth, increase profitability, managing merger and acquisition activities, and achieving corporate objectives. He has global experience with both publicly traded and privately held companies including Entelos Holding Corp., Avaya, Pharsight Corporation, The Walt Disney Company, and Ford Motor Company, amongst others. Prior to joining the Company, from 2015 to 2020, Mr. Frederick served as President and Managing Director of RightPlace Enterprises, providing C-Suite level strategic and financial consulting services to multiple companies. He served as Interim Chief Financial Officer at Sysorex Global Holdings Corp. from October 2014 to January 2015. He served as Chief Financial Officer at Neural ID LLC from April 2014 to September 2014. He served as Chief Financial Officer of Entelos Holding Corp. from January 2012 to January 2014, at which time it was acquired by Rosa & Co. Mr. Frederick holds an M.B.A degree from California State University at Long Beach and a B.A. degree in Finance from California State University at Fullerton.
DANIEL SZOT serves as our Chief Revenue Officer, and joined the company in January 2024. Mr. Szot brings more than 25 years of strategic sales and GTM leadership of scientific software platforms broadly spanning from research, discovery, and laboratory informatics into clinical research and manufacturing. Prior to joining the Company, he served as the Global Head of Sales and Operations at BIOVIA, a Dassault Systèmes brand. He also held previous senior leadership roles with MEDIDATA, PerkinElmer, and Cambridge Semantics. Throughout his career, Mr. Szot has led and unified cross-functional teams to deliver value-based transformational solutions and drive accelerated growth with clients across the life sciences and regulated industries. Mr. Szot holds an Bachelors of Science in Biology from William Paterson University of New Jersey.
JOHN DIBELLA joined the Company in June 2003 as a Modeling & Simulations Scientist, initially spending time working on the development of the GastroPlus® and DDDPlus™ software platforms, as well as serving as a technical lead on consulting projects for sponsor companies. In 2005, Mr. DiBella moved to the Marketing and Sales Department, and worked as a Field Scientist, where he eventually took over the Marketing and Sales Department and worked as Director until February 2012. Mr. DiBella was appointed Vice President of Marketing and Sales of the Company in March 2012. In September 2017, Mr. DiBella was appointed President of the Simulations Plus Division, and in connection with the Company's internal reorganization, his title was changed to Business Unit President of PBPK and Cheminformatics Solutions. Mr. DiBella leads our strategic efforts, hosts workshops, and presents at conferences globally. Mr. DiBella holds B.S. and Master's degrees in biomedical engineering from Case WesteReserve University.
DR. JONATHAN CHAUVIN joined the Company in April 2020 as the President of Lixoft, a modeling and simulation company acquired by Simulations Plus. Prior to this role, Jonathan Chauvin held positions as a research engineer, project manager, and product manager at IFP Energies nouvelles. The applications and products were in the field of mobility (thermal, hybrid, and electric vehicles ) and energy (as part of onshore wind and marine systems). During this period, he filed more than thirty patents and directed twenty publications in refereed committees' newspaper articles, and fifty conference papers in these areas. In connection with the Company's internal reorganization, Dr. Chauvin was appointed Business Unit President of CPP Software. Jonathan Chauvin graduated as a civil engineer at MINES ParisTech in 2003 and obtained his Ph.D. in Mathematics at Applied MINES ParisTech in 2006. He received the award for "Best thesis ParisTech" in 2007. Dr. Jonathan Chauvin is an applied mathematician.
JILL FIEDLER-KELLY joined the Company in September 2014 with the acquisition of Cognigen Corporation ("Cognigen"), where she had served as the Vice President of Pharmacometric Services and Chief Scientific Officer for over 20 years, since cofounding the company in 1992. In this role, she was primarily responsible for leading the scientific consulting group, ensuring the quality of deliverables and representing the Company to new clients. Ms. Fiedler-Kelly is an Adjunct Professor in the Department of Pharmaceutical Sciences at the University at Buffalo and was named a Fellow of the International Society of Pharmacometrics in 2016. In October 2019, she was appointed President of Cognigen, which was merged into the Company in September 2021 and became a division of Simulations Plus. In connection with the Company's internal reorganization, Ms. Fiedler-Kelly was appointed Business Unit President of CPP Services. Ms. Fiedler-Kelly brings approximately 31 years of experience in the implementation of population PK/PD modeling and simulation in drug development. She has also published numerous scientific papers in peer-reviewed journals, has presented at national and international symposia, and has held leadership positions in organizations such as the East Coast Population Analysis Group, the Population PK/PD Focus Group of the American Association of Pharmaceutical Scientists, and the ASCPT Board of Directors. She holds a B.A. degree in Statistics from the University at Buffalo and an M.S. in Applied and Mathematical Statistics from the Rochester Institute of Technology.
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STEVEN CHANG joined the Company in June 2023 as the President of Immunetrics, a modeling and simulation company acquired by Simulations Plus, and in August 2024, he was appointed as Business Unit President of Quantitative Systems Pharmacology Solutions. He is a successful technology entrepreneur with more than three decades of experience in identifying emerging market needs and combining state of the art technologies and resources to meet those needs. Mr. Chang served as President and Chief Executive Officer of Immunetrics from 2002 until the Company's acquisition of Immunetrics in June 2023. Prior to that, from 1998 to 2001, he served as Chief Executive Officer of Futuristic Labs, Inc. His experience includes work in diverse markets such as power generation, transportation logistics, critical care medicine, pharmaceutical drug development, quantitative systems pharmacology, and mobile applications. He is the recipient of two Westinghouse Signature Awards of Excellence. Mr. Chang received a BS and an MS in Electrical Engineering from the Rensselaer Polytechnic Institute in New York.
JENNA ROUSE joined the Company in June 2024 as the Chief Markets Officer of a Clinical division of Pro-ficiency, and in August 2024, she was appointed as a Business Unit President of Adaptive Learning & Insights, expert content creation team which delivers programming that is focused on the development of engaging, adaptive learning solutions independent of individualized analytics. Jenna started her career at EY and PwC in recruiting and business development until she craved the mission-based approach of nonprofit work. She joined the Association of Clinical Research Professionals (ACRP) and spent 16 years serving in various roles, including Business Development leader, and she successfully helped hundreds of organizations infuse competency-based education, hosted by Pro-ficiency, into their workforce initiatives. Through this work, Ms. Rouse began to notice her clients' appreciation and praise for the incredible Pro-ficiency platform, simulations, and customer service. Currently, Ms. Rouse helps clients (including ACRP) realize the full potential of their partnership with Pro-ficiency. Jenna holds a Bachelor's degree in art from the University of Colorado, Boulder.
MURRY ALPER joined the Company in June 2024 as the Chief Medical and Commercial Markets Officer of a Medical Communications division of Pro-ficiency, and in August 2024, he was appointed as a Business Unit President of Medical Communications, experienced medical communications consultants who provide strategy, positioning, messaging and tactical support for our clients in support of their market intelligence and commercial endeavors. Mr. Alper brings almost 30 years of experience in the Life Sciences industry, with experience at both major manufacturers, as well as on the agency side. Mr. Alper founded Caravel Group in 2006 after a decade in marketing and sales roles at Bristol-Myers Squibb and Genentech. Mr. Alper has cofounded multiple medical communications agencies and was Managing Partner of Compass Group Partners upon its purchase by QHP Capital in June of 2023.
Compensation Discussion and Analysis
The purpose of our compensation program is to attract and retain talented and dedicated professionals to manage and execute our strategic plans and tactical operations.
The goal of our Named Executive Officer compensation program is the same as our goal for operating our business - to create long-term value for our shareholders. Toward this goal, we have designed and implemented our compensation programs for our Named Executive Officers to reward them for sustained financial and operating performance and leadership excellence, to align their interests with those of our shareholders, and to encourage them to remain with the Company for long and productive careers. Most of our compensation elements simultaneously fulfill one or more of our performance, alignment, and retention objectives. These elements consist of salary and annual bonus, equity incentive compensation, and 401(k) matching retirement benefits. In determining the type and amount of compensation for each Named Executive Officer, we focus on both current pay and the opportunity for future compensation. We combine the compensation elements for each Named Executive Officer in a manner we believe optimizes the Named Executive Officer's contribution to the Company.
The Company employs performance metrics that compare our cumulative shareholder retuon our common stock, assuming reinvestment of dividends to the extent there are any distributed during the period, relative to the S&P Small Cap 600 and the S&P 600 Health Care Technology Industry Index. See our Annual Report on Form 10-K filed with the SEC on October 30, 2024, for details.
Determining Compensation
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We rely on the judgement of our Compensation Committee and our Board in making compensation decisions, after reviewing the performance of the Company and carefully evaluating an executive's performance during the year against established goals, leadership qualities, operational performance, business responsibilities, career with the Company, current compensation arrangements, and long-term potential to enhance shareholder value.
There is currently no equity ownership requirement in place for our Named Executive Officers.
The compensation of our Chief Executive Officer ("CEO") is determined by the Compensation Committee. The salaries of all other officers are determined by the CEO and the Compensation Committee together. Option grants for all officers other than our CEO are recommended by the CEO and approved by the Compensation Committee and our Board. In fiscal year 2022, the Company engaged an external compensation consultant, Arthur J. Gallagher & Co. ("Gallagher"), to benchmark the Company's executive compensation against a comparable peer group. The results of this compensation study provided a useful reference point in the Compensation Committee's efforts to appropriately align target executive compensation to that of our peers, which affords our Named Executive Officers the opportunity to eaabove-target levels of compensation for exceptional performance that could be expected to increase value for shareholders, while providing that they would ealess than targeted compensation if the Company's performance failed to meet expectations.
After consideration of Gallagher's recommendations related to executive compensation in fiscal 2022 and consistent with fiscal year 2023, amongst other things, the Compensation Committee determined that for fiscal 2024, 80%, or $308,880, of the CEO's target bonus was tied to Company performance and 20%, or $77,220, of the CEO's target bonus was tied to individual performance. The breakdown of the applicable performance metrics for fiscal 2024 are as follows:
Company Performance Metrics
For each annual fiscal period, the Compensation Committee reviews and approves, among other financial metrics, the budgeted amount for revenue and net income. The Company considers these to be its most important metrics to evaluate the Company's performance toward increasing shareholder value. Accordingly, the portion of the CEO's bonus tied to Company performance was based on revenue and net income for fiscal 2024. Each performance metric had equal weight of 50%. No performance bonus was to be paid to the CEO with respect to a particular performance metric if the actual results of that performance metric were below 80% of the budgeted amount for that performance metric (the "Minimum Payout Targets"). No additional performance bonus was to be paid to the CEO with respect to a particular performance metric to the extent that actual results of that performance metric exceeded 120% of the budgeted amount for that performance metric (the "Maximum Payout Targets"). The actual payout to the CEO when the Company achieves performance between the Minimum and Maximum Payout Targets is based on linear interpolation. The effect of any acquisitions during the fiscal year was removed from the actual results of each performance metric for purposes of determining the CEO's performance bonus.
Individual Performance Metrics
Of the 20% of the CEO's target bonus tied to individual performance in fiscal 2024, 10% was to be paid for the achievement of the identification of a suitable acquisition target and obtaining a signed indication of interest or legal agreement, and 10% was to be paid for the achievement of three management team development objectives, with equal weight (or 3.33% of the total bonus target) attributable to each of the three objectives. The first objective was to provide a memo to the Nominating & Corporate Governance Committee with recommendations for the Company's succession plan, which was to include existing personnel staff replacements for each executive position, recommended training and development for such existing personnel staff replacements, and any additional hiring needed. The second objective was to further the Company's progress towards strengthening its commitment to human rights, health and safety, and sustainability to achieve meaningful progress across critical ESG pillars. The third objective related to a leadership assessment of the CEO performed by the CEO's direct reports, the Board, and any other individuals at the discretion of the Board. CEO was paid a $75,000 bonus for the acquisition of Pro-ficiency.
The Compensation Committee determined that for fiscal 2025, 80%, or $315,960, of the CEO's target bonus will be tied to Company performance, as measured by revenue and net income, and 20%, or $78,990, of the CEO's target bonus will be tied to individual performance, as measured by four equally weighted criteria specified by the Compensation Committee.
Clawback Policy
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In October 2023, we adopted a compensation recovery policy (the "Clawback Policy") that is designed to comply with, and will be interpreted in a manner consistent with, Section 10D and Rule 10D-1 of the Exchange Act and the applicable rules of the Nasdaq Stock Market, including any interpretive guidance provided by Nasdaq. Under our Clawback Policy, in the event of an accounting restatement due to the Company's material noncompliance with any financial reporting requirement under the securities laws, including any required accounting restatement to correct a material error in previously issued financial statements, or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period, the Company must recover erroneously awarded incentive-based compensation previously paid to the Company's executive officers in accordance with the terms of such Clawback Policy. Furthermore, under the Clawback Policy, the Company is prohibited from indemnifying any executive officer or former executive officer against the loss of erroneously awarded incentive-based compensation and from paying or reimbursing an executive officer for purchasing insurance to cover any such loss.
Risk Assessment
The Compensation Committee has determined that our compensation programs are designed and administered with the appropriate balance of risk and reward in relation to our overall business strategy and such programs do not encourage our executives to take unnecessary or excessive risks that are reasonably likely to have a material adverse effect on the Company.
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Summary Compensation Table
The following Summary Compensation Table ("SCT") sets forth certain information concerning compensation paid or accrued for the fiscal years ended August 31, 2024, 2023, and 2022 by the Company to or for the benefit of (i) all individuals serving as our principal executive officer in fiscal year 2024, (ii) all individuals serving as our principal financial officer in fiscal year 2024, (iii) our three most highly compensated executive officers, other than our principal executive and principal financial officers, who were serving as executive officers as of August 31, 2024, and (iv) a former executive officer for whom disclosure would have been provided pursuant to the foregoing but for the fact that he was not serving as an executive officer of the Company as of August 31, 2024. We refer to these executive officers as our "Named Executive Officers" or our "NEOs."
Summary Compensation Table
Name and Principal Position Fiscal Year Salary ($) Bonus ($) Option Awards ($) All other compensation ($) Total ($)
(a) (b) (c)
Shawn O'Connor Chief Executive Officer 2024 511,608 152,200 990,000 3,812 1,657,620
2023 487,479 357,800 1,094,440 2,285 1,942,005
2022 450,000 259,300 600,228 33,324 1,342,852
Will Frederick Chief Financial Officer & Chief Operating Officer 2024 335,404 161,100 495,000 15,776 1,007,280
2023 319,570 108,800 437,776 14,751 880,897
2022 290,822 87,100 114,743 11,608 504,273
Daniel Szot Chief Revenue Officer 2024 215,779 34,000 572,400 72,887 895,066
2023 - - - - -
2022 - - - - -
John DiBella Business Unit President, PBPK and CHEM Solutions 2024 335,404 16,900 297,000 12,320 661,624
2023 319,570 71,400 328,332 8,833 728,135
2022 289,986 58,800 131,572 56,406 536,764
Steven Chang Business Unit President, QSP Solutions 2024 330,000 16,500 297,000 12,914 656,414
2023 68,712 91,141 74,232 4,500 238,585
2022 - - - - -
Dr. Brett Howell Former Business Unit President, QSP Solutions 2024 272,891 - 297,000 286,940 856,831
2023 259,989 51,400 328,332 10,278 649,999
2022 237,493 50,100 76,496 44,045 408,134
(a)Amount represents bonus earned during the applicable fiscal year and paid in the following fiscal year including mergers and acquisitions transaction bonuses paid to Shawn O'Connor, Will Frederick, and Daniel Szot during the 2024 fiscal year.
(b)The amounts reported in the "Option Awards" column reflect the aggregate grant-date fair value of stock options awarded during the year computed in accordance with the provisions of Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 718. See Note 8 to our consolidated financial statements included in our Annual Report, which was filed with the SEC on October 30, 2024, regarding assumptions underlying the valuation of equity awards. These amounts reflect the accounting cost for these stock options and do not reflect the actual economic value that may be realized by the named executive officer upon the vesting of the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options. See the "Grants of Plan-Based Awards" table, below, for additional information.
(c)Includes 401(k) matching, vacation payout, life insurance premiums, health savings matching, commission paid to Daniel Szot during the 2024 fiscal year, and severance paid to Dr. Howell during the 2024 fiscal year pursuant to his employment agreement.
(d)Dr. Howell previously served as President, Quantitative Systems Pharmacology. He departed from the Company on August 30, 2024.
Employment and Other Compensation Agreements
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Mr. O'Connor's Employment Agreement
On September 3, 2020, Shawn O'Connor, entered into a three-year employment agreement (effective as of September 1, 2020) as the Chief Executive Officer of the Company. Pursuant to the agreement, Mr. O'Connor received a one-time sign-on bonus of $100,000 in September 2020; received an annual base salary of $450,000 in fiscal 2021 and 2022, which was increased to $495,000 in fiscal 2023; and was eligible to receive an annual performance bonus consisting of the following: (i) a cash bonus of up to 50% of Mr. O'Connor's salary, as determined by the Compensation Committee, (ii) a grant of 30,000 stock options, and (iii) an additional discretionary bonus of up to $75,000 and a grant of 7,500 stock options, as determined by the Board (in its sole discretion), based on Mr. O'Connor's and the Company's performance in the relevant year. The agreement also provided that we may terminate the agreement without cause upon thirty days written notice, and that upon any such termination our only obligation to Mr. O'Connor would be for a payment equal to 12 months of salary and benefits for the same period. Further, the agreement provided that we may terminate the agreement for "cause" (as defined in the agreement) and that our only obligation to Mr. O'Connor upon any such termination would be limited to the payment of Mr. O'Connor's base salary and benefits through and until the effective date of any such termination.
On November 19, 2021, Mr. O'Connor entered into a First Amendment to Employment Agreement, which amended Mr. O'Connor's employment agreement to provide that Mr. O'Connor shall be eligible, on an annual basis, to receive a target cash performance bonus based on individual and corporate metrics, of 50% of Mr. O'Connor's base salary; provided, however, that the actual amount of such bonus, if any, may be less than or exceed the target amount and shall be determined by the Board, in its sole discretion, based upon recommendation by the Compensation Committee of the Board. The amendment did not alter any other terms of his employment agreement.
On November 1, 2023, the Company and Mr. O'Connor entered into an amended and restated employment agreement. The new agreement has materially the same terms as his prior employment agreement, as amended, except as follows: (i) the initial term of his new agreement ends December 1, 2024, after which it will automatically renew for successive one year terms until terminated in accordance with the agreement; (ii) effective on October 30, 2023, his base salary was increased to $514,800; (iii) his target cash performance bonus was increased to 75% of his base salary, provided that the actual amount paid (if any) shall be determined by the Board, in its discretion, and may be less than or exceed the target amount; (iv) he is eligible to receive a target stock option grant of 50,000 stock options, at the discretion of the Board, and (iv) incentive-based clawback provisions were added to align with the Company's new Clawback Policy. All compensation, including base salary and bonus targets and metrics, is subject to annual review and modification by the Board, upon recommendation of the Compensation Committee. Effective on October 28, 2024, his base salary was increased to $526,600; his target cash bonus percentage and stock option grant remained unchanged.
Mr. Frederick's Employment Agreement
On December 1, 2020, Will Frederick entered into a two-year employment agreement as the Chief Financial Officer of the Company, which agreement shall continue from year to year unless either party gives notice to the other party of its desire to change, amend, or terminate the agreement at least 60 days prior to the end of the then-existing term of the agreement. Pursuant to the agreement, Mr. Frederick received a one-time sign-on grant of 20,000 stock options; received an annual base salary of $270,000 in fiscal 2021, which was increased to $295,000 in fiscal 2022 and further increased to $324,500 in fiscal 2023; and was eligible to receive an annual performance bonus consisting of (i) a cash bonus in an amount between 25% to 35% of his base salary, with a target of 30% in fiscal 2021 (increased to 35% in fiscal 2022), as determined by the Compensation Committee, and (ii) a grant of between 5,000 and 15,000 stock options in fiscal 2021 (increased to 20,000 stock options in fiscal 2022). The agreement also provided that we may terminate the agreement without cause upon thirty days written notice, and that upon any such termination, our only obligation to Mr. Frederick would be for a payment equal to 12 months of salary and benefits for the same period. Further, the agreement provided that we may terminate the agreement for "cause" (as defined in the agreement) and that our only obligation to Mr. Frederick upon any such termination would be limited to the payment of Mr. Frederick's salary and benefits through and until the effective date of any such termination.
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On November 1, 2023, the Company and Mr. Frederick entered into an amended and restated employment agreement. The new agreement has materially the same terms as his prior employment agreement, as amended, except as follows: (i) effective on October 30, 2023, his base salary was increased to $337,500; (ii) he is eligible to receive a target cash performance bonus equal to 35% of his base salary, provided that the actual amount paid (if any) shall be determined by the Board, in its discretion, and may be less than or exceed the target amount; (iii) he is eligible to receive a target stock option grant of 20,000 stock options, at the discretion of the Board, and (iv) incentive-based clawback provisions were added to align with the Company's new Clawback Policy. On January 3, 2024, Will Frederick was appointed to the additional role of Chief Operating Officer, in addition to his roles as Chief Financial Officer and Secretary of the Company. There was no change in Mr. Frederick's compensation as a result of his assumption of the additional role of Chief Operating Officer. All compensation, including base salary and bonus targets and metrics, is subject to annual review and modification by the Board, upon recommendation of the Compensation Committee. Effective on October 28, 2024, his base salary was increased to $345,300; his target cash bonus percentage and stock option grant remained unchanged.
Mr. Szot's Employment Agreement
On November 21, 2023, Dan Szot accepted an offer of employment as the Chief Revenue Officer of the Company beginning January 2, 2024. Pursuant to the offer, Mr. Szot received an annual base salary of $325,000 in fiscal year 2024; received a one-time sign-on grant of 30,000 stock options; remains eligible for an annual option grant of 15,000 per year; was eligible to receive an annual performance bonus equal to 15% of his base salary; and was eligible to receive on-target commissions of $130,000 under his fiscal year 2024 sales commission plan. He is currently under an at-will employment arrangement and has not entered into a formal employment agreement with the Company.
Mr. DiBella's Employment Agreement
On January 1, 2022, John DiBella, entered into a two-year employment agreement as the President of the Simulations Plus Division of Simulations Plus, Inc. Pursuant to the agreement, Mr. DiBella received an annual base salary of $295,000 in fiscal 2022, which was increased to $324,500 in fiscal 2023; was eligible to receive Company stock options of between 5,000 and 15,000 per year (increased to a target of 15,000 in fiscal 2023); and was eligible to receive an annual performance bonus in an amount between 15% to 25% of salary (increased to a target of 25% in fiscal 2023), to be determined by the Compensation Committee of the Board. The agreement also provided that we may terminate the agreement without cause upon thirty days written notice, and upon any such termination, our only obligation to Mr. DiBella would be for a payment equal to the greater of (i) 12 months of salary or (ii) the amount of salary for the remainder of the term of the agreement from the date of notice of termination. Further, the agreement provided that we may terminate the agreement for "cause" (as defined in the agreement) and that our only obligation to Mr. DiBella upon any such termination would be limited to the payment of Mr. DiBella's salary and benefits through and until the effective date of any such termination.
On November 1, 2023, the Company and Mr. DiBella entered into an amended and restated employment agreement. The new agreement has materially the same terms as his prior employment agreement, as amended, except as follows: (i) Mr. DiBella's title was changed to President, PBPK/Cheminformatics Solutions/Regulatory Services; (ii) effective on October 30, 2023, his base salary was increased to $337,500; (iii) he is eligible to receive a target cash performance bonus equal to 25% of his base salary, provided that the actual amount paid (if any) shall be determined by the Board, in its discretion, and may be less than or exceed the target amount; (iv) he is eligible to receive a target stock option grant of 15,000 stock options, at the discretion of the Board, and (v) incentive-based clawback provisions were added to align with the Company's new Clawback Policy. All compensation, including base salary and bonus targets and metrics, is subject to annual review and modification by the Board, upon recommendation of the Compensation Committee. Effective on October 28, 2024, his base salary was increased to $345,300; his target cash bonus percentage and stock option grant remained unchanged.
Mr. Chang's Employment Agreement
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On June 16, 2023, Steven Chang entered into a two-year employment agreement as the President of the Immunetrics division of the Company. Pursuant to the agreement, Mr. Chang received an annual base salary of $330,000 in fiscal year 2024; is eligible to receive Company stock options of between 5,000 and 15,000 per year; and is eligible to receive an annual performance bonus in an amount of up to 10% of salary, to be determined by the Compensation Committee of the Board. The agreement also provides that we may terminate the agreement without cause upon thirty days written notice, and upon any such termination, our only obligation to Mr. Chang would be for a payment equal to the greater of (i) 12 months of salary or (ii) the amount of salary for the remainder of the term of the agreement from the date of notice of termination. Further, the agreement provides that we may terminate the agreement for "cause" (as defined in the agreement) and that our only obligation to Mr. Chang upon any such termination would be limited to the payment of Mr. Chang's salary and benefits through and until the effective date of any such termination.
Dr. Brett Howell's Employment Agreement
On January 1, 2022, Dr. Brett Howell, entered into a two-year employment agreement as the President of the DILIsym Division of Simulations Plus, Inc. Pursuant to the agreement, Dr. Howell received an annual base salary of $240,000 in fiscal 2022, which was increased to $264,000 in fiscal 2023; was eligible to receive Company stock options of between 5,000 and 15,000 per year (increased to a target of 15,000 in fiscal 2023); and was eligible to receive an annual performance bonus in an amount between 15% to 25% of his base salary (increased to a target of 25% in fiscal 2023), to be determined by the Compensation Committee of the Board. The agreement also provided that we may terminate the agreement without cause upon thirty days written notice, and upon any such termination, our only obligation to Dr. Howell would be for a payment equal to the greater of (i) 12 months of salary or (ii) the amount of salary for the remainder of the term of the agreement from the date of notice of termination. Further, the agreement provided that we may terminate the agreement for "cause" (as defined in the agreement) and that our only obligation to Mr. Howell upon any such termination would be limited to the payment of Dr. Howell's salary and benefits through and until the effective date of any such termination.
In November 2023, the Company and Dr. Howell entered into an amended and restated employment agreement. The new agreement had materially the same terms as his prior employment agreement, as amended, except as follows: (i) Dr. Howell's title was changed to President, Quantitative Systems Pharmacology Solutions; (ii) effective on October 30, 2023, his base salary was increased to $274,600; (iii) he was eligible to receive a target cash performance bonus equal to 25% of his base salary, provided that the actual amount paid (if any) was to be determined by the Board, in its discretion, and could be less than or exceed the target amount; (iv) he was eligible to receive a target stock option grant of 15,000 stock options, at the discretion of the Board, and (v) incentive-based clawback provisions were added to align with the Company's new Clawback Policy. All compensation, including base salary and bonus targets and metrics, was subject to annual review and modification by the Board, upon recommendation of the Compensation Committee.
Dr. Howell departed from the Company on August 30, 2024. In connection with Dr. Howell's transition, he entered into a separation agreement consistent with his written employment agreement, as amended and restated, which, among other things, provided for the payment of twelve months' severance and related separation benefits.
Other Executive Officers and Company Employees
Bonuses for other executive officers and our employees are determined equitably based on a target bonus assigned to their position within the Company. The percent of target achieved is based on a calculation of Company performance, business unit/department performance and individual performance as determined by yearly goal achievement. All calculated bonuses are then approved by executive leadership and the Board.
The Company provides 401(k) matching up to 4% of US employees' salaries or wages up to the U.S. Internal Revenue Service maximum allowable, regardless of their position within the Company.
The Company offers a competitive total-rewards program which includes competitive health and dental insurance plan options (with employee premiums paid by the Company), Company-paid disability and life insurance plans, flexible time off, and parental leave. All employees are eligible for our training and development program, which includes reimbursement for approved training, memberships and subscriptions, and conference attendance.
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Grants of Plan-Based Awards
The following table discloses information about option grants to the Named Executive Officers during the fiscal year ended August 31, 2024:
Name Grant Date All Other Option Awards: Number of Securities Underlying Options Exercise or Base price of Option Awards Grant Date Fair Value of Stock and Option Awards (a)
Shawn O'Connor 10/19/2023 50,000 $ 39.98 $ 990,000
Will Frederick 10/19/2023 25,000 $ 39.98 495,000
Daniel Szot 3/28/2024 30,000 $ 41.15 572,400
John DiBella 10/19/2023 15,000 $ 39.98 297,000
Steven Chang 10/19/2023 15,000 $ 39.98 297,000
Dr. Brett Howell 10/19/2023 15,000 $ 39.98 297,000
Total 150,000 $ 2,948,400
(a)The amounts reported in the "Grant Date Fair Value of Stock and Option Awards" column reflect the aggregate grant date fair value of stock options awarded during the year computed in accordance with the provisions of Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 718. See Note 6 to our consolidated financial statements in our Annual Report on Form 10-K, which was filed with the SEC on October 30, 2024, regarding assumptions underlying the valuation of equity awards. These amounts reflect the accounting cost for these stock options and do not reflect the actual economic value that may be realized by the named executive officer upon the vesting of the stock options, the exercise of the stock options or the sale of the common stock underlying such stock options.
Pay versus Performance
Compensation Actually Paid
Year(a) SCT Total for CEO Compensation Actually Paid to CEO (a) Avg. Summary Compensation Table Total for Non-CEO NEOs Avg. Compensation Actually Paid to Non-CEO NEOs (b) Value of Initial Fixed $100 Investment Based On: Net Income Revenue
Company TSR (c) Peer Group TSR (SP600-351030) (d)
2024 1,657,620 1,386,522 815,443 689,116 62 53 9,954,000 70,013,000
2023 1,942,005 1,477,766 745,283 488,551 76 110 9,961,000 59,577,000
2022 1,342,852 2,225,216 464,456 826,568 102 117 12,483,000 53,906,000
2021 1,072,271 693,668 554,394 394,518 75 155 9,782,000 46,466,000
(a)The Company's CEO, and only principal executive officer, for each of fiscal 2024, 2023, 2022, and 2021 was Shawn O'Connor.
(b)The Company's non-CEO NEOs for fiscal 2024 were Will Frederick, Daniel Szot, John DiBella, Steven Chang, and Dr. Brett Howell. The Company's non-CEO NEOs for each of fiscal 2023, 2022, and 2021 were Will Frederick, John DiBella, Jill Fiedler-Kelly, and Dr. Brett Howell.
(c)Company is providing this disclosure pursuant to 17 CFR 229.402(v) for the last four fiscal years, instead of five years, and will provide disclosure for an additional year in the next subsequent annual filing in which this disclosure is required.
(d)Company total shareholder retu("TSR") reflects TSR for Simulations Plus, Inc. (ticker: SLP). Peer Group TSR is calculated based on the S&P 600 Health Care Technology Industry Index ("SP600-351030"), which is used for purposes of Item 201(e)(1)(ii) of Regulation S-K under the Exchange Act.
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To calculate Compensation Actually Paid ("CAP"), the following amounts were deducted from and added to the total compensation included in the SCT, above, as required by 17 CFR 229.402(v)(3).
The following footnotes (a) and (b) related to each of the following tables for each of the 2024, 2023, 2022, and 2021 fiscal years, respectively:
(a)Represents the grant-date fair value of option awards granted each year.
(b)Reflects the value of equity calculated in accordance with the SEC methodology for determining Compensation Actually Paid for each year shown. For all option awards, our methodology for calculating the value of options remained consistent between the grant-date fair-value measurement reflected in row one of the above table and the point-in-time fair-value measurements reflected in the adjustment rows that follow. In all cases, we use the closing price of our common stock on the Nasdaq Global Select Market on the applicable date as a basis for fair value.
2024
CEO ($) Average for Non-CEO Named Executive Officers ($)
SCT Total 1,657,620 815,443
Adjustments
Deduction for Amounts Reported Under the "Option Awards" Column in the SCT (a) (990,000) (391,680)
Increase for Fair Value of Awards Granted during year that Remain Unvested as of Year End (b) 1,031,895 412,960
Increase for Fair Value of Awards Granted during year that Vest during year (b) - -
Increase/deduction for Change in Fair Value from Prior Year-end to Current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end (b) (228,235) (116,472)
Increase/deduction for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year (b) (84,758) (31,135)
Compensation Actually Paid 1,386,522 689,116
2023
CEO ($) Average for Non-CEO Named Executive Officers ($)
SCT Total 1,942,005 745,283
Adjustments
Deduction for Amounts Reported Under the "Option Awards" Column in the SCT (a) (1,094,440) (355,693)
Increase for Fair Value of Awards Granted during year that Remain Unvested as of Year End (b) 1,218,665 396,066
Increase for Fair Value of Awards Granted during year that Vest during year (b) - -
Increase/deduction for Change in Fair Value from Prior Year-end to Current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end (b) (354,302) (181,484)
Increase/deduction for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year (b) (234,161) (115,621)
Compensation Actually Paid 1,477,766 488,551
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2022
CEO ($) Average for Non-CEO Named Executive Officers ($)
SCT Total 1,342,852 464,456
Adjustments
Deduction for Amounts Reported Under the "Option Awards" Column in the SCT (a) (600,228) (99,827)
Increase for Fair Value of Awards Granted during year that Remain Unvested as of Year End (b) 1,143,613 248,736
Increase for Fair Value of Awards Granted during year that Vest during year (b) - -
Increase/deduction for Change in Fair Value from Prior Year-end to Current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end (b) 303,112 105,661
Increase/deduction for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year (b) 35,867 107,541
Compensation Actually Paid 2,225,216 826,568
2021
CEO ($) Average for Non-CEO Named Executive Officers ($)
SCT Total 1,072,271 554,394
Adjustments
Deduction for Amounts Reported Under the "Option Awards" Column in the SCT (a) (528,040) (274,445)
Increase for Fair Value of Awards Granted during year that Remain Unvested as of Year End (b) 418,298 211,842
Increase for Fair Value of Awards Granted during year that Vest during year (b) - -
Increase/deduction for Change in Fair Value from Prior Year-end to Current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end (b) (292,933) (142,679)
Increase/deduction for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year (b) 24,072 45,406
Compensation Actually Paid 693,668 394,518
Relationship Between Compensation Actually Paid and TSR:
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CEO and Non-CEO NEOs CAP in millions; Company TSR and Peer TSR in US dollars per share on retuon $100 investment.
Relationship Between Compensation Actually Paid and Net Income:
CEO and non-CEO NEOs CAP in millions; Net Income in millions.
Relationship Between Compensation Actually Paid and Revenue:
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CEO and non-CEO NEOs CAP in millions; Revenue in millions.
Outstanding Equity Awards
The following table sets forth information regarding outstanding equity awards held by our Named Executive Officers as of August 31, 2024:
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Name(a) Number of Securities Underlying Unexercised Options (Exercisable) Number of Securities Underlying Unexercised Options (Unexercisable) Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options Option Exercise Price Option Expiration Date
Shawn O'Connor - 50,000 (a) - $ 39.98 10/19/2033
20,000 (a) 30,000 (a) - $ 43.91 10/20/2032
21,000 (a) 9,000 (a) - $ 46.09 10/26/2031
25,000 (a) - - $ 59.97 09/04/2030
20,000 (a) - - $ 36.11 09/01/2029
20,000 (a) - - $ 23.75 06/26/2028
Total 106,000 89,000 -
Will Frederick - 25,000 (c) - $ 39.98 10/19/2033
5,000 (c) 15,000 (c) - $ 43.91 10/20/2032
1,650 (c) 3,750 (c) - $ 37.89 10/20/2031
15,000 (c) 5,000 (c) - $ 56.40 12/01/2030
Total 21,650 48,750 -
Daniel Szot - 30,000 (c) - $ 41.15 03/28/2034
Total - 30,000 -
John DiBella - 15,000 (c) - $ 39.98 10/19/2033
3,750 (c) 11,250 (c) - $ 43.91 10/20/2032
4,300 (c) 4,300 (c) - $ 37.89 10/20/2031
6,975 (c) 2,325 (c) - $ 57.67 12/07/2030
4,000 (b) 1,000 (b) - $ 32.57 12/06/2029
2,589 (b) - - $ 19.81 12/11/2028
26,206 (b) - - $ 10.05 02/23/2027
10,300 (b) - - $ 9.71 02/25/2026
Total 58,120 33,875 -
Steven Chang - 15,000 (c) - $ 39.98 10/19/2033
Total - 15,000 -
Dr. Brett Howell 3,750 (d) - - $ 43.91 10/29/2024
2,500 (d) - - $ 37.89 10/29/2024
7,425 (d) - - $ 57.67 10/29/2024
3,000 (d) - - $ 32.57 10/29/2024
12,000 (d) - - $ 19.81 10/29/2024
200 (d) - - $ 14.35 10/29/2024
Total 28,875 - -
__________________
(a)Options vest on each of the first three anniversaries of the grant date at a rate of 40%, 30%, and 30% of the shares subject to the option, respectively, and have a 10-year term.
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(b)Options vest as to 20% of the shares subject to the option on each of the first five anniversaries of the grant date and have a 10-year term.
(c)Options vest as to 25% of the shares subject to the option on each of the first four anniversaries of the grant date and have a 10-year term.
(d)All unvested options outstanding were forfeited upon Dr. Howell's termination. All of his remaining vested options outstanding got forfeited on October 29, 2024 as per the grant agreements.
Equity Compensation Plan Information
The following table provides information as of August 31, 2024, regarding our equity compensation plans:
Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans
Equity compensation plans approved by security holders 1,905,881 $ 37.64 1,233,853
Equity compensation plans not approved by security holders - - -
Total 1,905,881 $ 37.64 1,233,853
Option Exercises and Stock Vested
The following table sets forth information regarding stock option exercises for the Company's NEOs during the fiscal year ended August 31, 2024:
Option Awards
Name Number of Shares Acquired on Exercise (#) Value Realized on Exercise ($) (1)
Shawn O'Connor - -
Will Frederick 225 434
Daniel Szot - -
John DiBella 5,411 137,169
Steven Chang - -
Brett Howell - -
(1)If the shares were sold immediately upon exercise, the value realized on exercise of the option is the difference between the actual sales price and the exercise price of the option. Otherwise, the value realized is the difference between the closing price of the Company's common stock on the Nasdaq Global Select Market on the date of exercise and the exercise price of the option.
No restricted stock awards or restricted stock units have been issued to our NEOs.
44
Pay Ratio Disclosure
The following is a reasonable estimate, prepared under applicable SEC rules, of the ratio of the annual total compensation of our CEO to the median of the annual total compensation of our other employees. We determined our median employee based on base salary (annualized in the case of full- and part-time employees who joined the Company during fiscal year 2024) of each of our employees (excluding the CEO), as of August 31, 2024. The annual total compensation of our median employee (other than the CEO) for 2024 was $160,901. As disclosed in the Summary Compensation Table appearing on page 34 of this Proxy Statement, our CEO's annual total compensation for fiscal year 2024 was $1,657,620. Based on the foregoing, our estimate of the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all other employees was 10 to 1. Given the different methodologies that various public companies will use to determine an estimate of their pay ratio, the estimated ratio reported above should not be used as a basis for comparison between companies.
HOUSEHOLDING OF MATERIALS
The SEC has adopted rules that permit companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy statements and annual reports with respect to two or more shareholders sharing the same address by delivering a single proxy statement addressed to those shareholders. This process, which is commonly referred to as "householding," potentially means extra convenience for shareholders and cost savings for companies.
We have adopted householding for our shareholders who share an address. If you reside at the same address as another shareholder of the Company and wish to receive a separate copy of the applicable materials, you may do so by making a written or oral request to: Will Frederick, Simulations Plus, Inc., P.O. Box 12317, Research Triangle Park, NC 27709, or call (661) 723-7723. Upon your request, we will promptly deliver a separate copy to you.
Some brokers household proxy materials, delivering a single proxy statement or notice to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once you have received notice from your broker that they will be householding materials 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 proxy statement or notice, please notify your broker directly.
Any shareholders who share the same address and currently receive multiple copies of our proxy statements and annual reports, as applicable, and who wish to receive only one copy in the future may contact their bank, broker, or other holder of record, or the Company at the contact information listed above, to request information about householding.
SHAREHOLDER COMMUNICATIONS
Shareholders are encouraged to contact the Company with any requests for information or to communicate with the Board via telephone, mail, or through our website investor information request form at: http://www.simulations-plus.com/InvestorForm.aspx or through the general information request page: http://www.simulations-plus.com/contact.aspx.
45
SHAREHOLDER PROPOSALS
Shareholders may submit proposals on matters appropriate for shareholder action at our subsequent annual meetings consistent with Rule 14a-8 promulgated under the Exchange Act. For such proposals to be considered timely, they must be received in writing by our Secretary no later than 120 days before the one year anniversary of the date on which the Company first sent its proxy materials to shareholders for the prior year's annual meeting of shareholders. For such proposals to be considered for inclusion in this Proxy Statement and the proxy relating to this Annual Meeting, they must have been received by us no later than August 24, 2024. For such proposals to be considered for inclusion in the proxy statement and proxy relating to our next annual meeting of shareholders, they must be received by us no later than August 25, 2025. Notwithstanding the foregoing, if our next annual meeting of shareholders is held more than 30 days before or after the anniversary of this Annual Meeting, then the deadline for such proposals to be considered for inclusion in the proxy statement and proxy relating to our next annual meeting of shareholders will be a reasonable time before we begin to print and send our proxy materials.
Shareholders who wish to nominate individuals for election as directors at our subsequent annual meetings must follow the process and satisfy the requirements set forth in Rule 14a-19 promulgated under the Exchange Act. For notice of such nominations to be considered timely, the notice must be submitted to our Secretary in writing and must be postmarked or electronically submitted no later than 60 days before the one-year anniversary of the annual meeting of shareholders of the Company for the prior year. Notwithstanding the foregoing, if we did not hold an annual meeting the prior year or our annual meeting of shareholders is held more than 30 days before or after the anniversary of the prior year's annual meeting, then notice must be provided by the later of 60 days prior to the date of the current year's annual meeting or the 10th calendar day following the day on which public announcement of the date of the annual meeting is first made by us. For nominees to be considered for inclusion in this Proxy Statement and the proxy relating to this Annual Meeting, notice thereof must have been postmarked or electronically submitted no later than December 10, 2024. For nominees to be considered for inclusion in the proxy statement and proxy relating to our next annual meeting of shareholders, notice thereof must be postmarked or electronically submitted no later than December 15, 2025.
Notice of shareholder proposals and director nominees for inclusion at our next annual meeting of shareholders should be directed to the attention of the Corporate Secretary of the Company, Will Frederick, P.O. Box 12317, Research Triangle Park, NC 27709. Any proposal will be included in next year's proxy materials only if such proposal complies with the rules and regulations promulgated by the SEC, including the provisions of Rule 14a-8 and Rule 14a-19 promulgated under the Exchange Act. Nothing in this section shall be deemed to require us to include in our proxy statement or our proxy relating to any meeting any shareholder proposal or nomination that does not meet all of the requirements for inclusion established by the SEC.
OTHER MATTERS
The Board knows of no other matters to be presented at the Meeting other than those described above. However, if any other matters properly come before the Meeting, it is intended that any shares voted by proxy will be voted in the discretion of the Board.
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PROXY

Disclaimer

Simulations Plus Inc. published this content on December 23, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on December 23, 2024 at 21:30:31.180.

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