2020-07-24T11:21:55-05:00 2020-03-31 910189318 MOSS ADAMS LLP 10960 WILSHIRE BLVD SUITE 1100 LOS ANGELES CA 90024 990 2019-04-01 954002032 THE ALFRED E MANN FOUNDATION FOR SCIENTIFIC RESEARCH ALFR 6617026700 25134 RYE CANYON LOOP SANTA CLARITA CA 91355 JOHN PETROVICH CEO 6617026700 2020-07-21 1 WENDY CAMPOS P00448102 3104770450 2020-07-21 23.242.64.125 2020-07-21 12:16:31 PD P DA39A3EE5E6B4B0D3255BFEF95601890AFD80709 7D0D6C7A6A5655B0595BBDB8C4257A6B648F0CEB 2019 2020-11-19 02:30:22Z JOHN PETROVICH 25134 RYE CANYON LOOP SANTA CLARITA CA 91355 9491255 0 X WWW.AEMF.ORG X 1985 CA CONDUCT MEDICAL AND SCIENTIFIC RESEARCH X 6 5 37 0 24238 5946 680 936 280372 887240 -95738 -104857 149392 1529155 334706 2312474 5000 5000 0 0 5452908 9341164 0 0 0 2583231 4512944 8041139 13859108 -7706433 -11546634 93529351 59071014 7095338 11490776 86434013 47580238 X THE ALFRED E. MANN FOUNDATION FOR SCIENTIFIC RESEARCH IS A MEDICAL RESEARCH ORGANIZATION DEDICATED TO DEVELOPING AND COMMERCIALIZING INNOVATIVE SOLUTIONS FOR SIGNIFICANT UNMET MEDICAL CONDITIONS. 0 0 1754859 5000 306131 IMPLANTABLE MYOELECTRIC SENSOR II (INFINITY) + OSSURTHE INITIAL IMES COLLABORATION WAS RE-VITALIZED TO COMMENCE RESEARCH AND DEVELOPMENT WORK ON A SECOND GENERATION OF IMES, WHICH WILL CONTAIN ADVANCED FEATURES BASED ON PATIENT FEEDBACK RECEIVED FORM THE IMES I CLINICAL TRIAL. THESE FEATURES ARE INTENDED TO IMPROVE MEDICAL OUTCOMES AT NO ADDITIONAL COST TO THE PATIENT OR HEALTHCARE SYSTEM. THE TECHNOLOGY HAS BEEN LICENSED TO OSSUR AND IS IN DESIGN TRANSFER.STATUS: ADDITIONAL ANALYSIS AND DEVELOPMENT WORK WAS DONE TO PREDICT FEASIBILITY OF THE USE OF THE DEVICE ON LOWER LIMBS; THE PRODUCT WAS TRANSFERRED TO A COMMERCIAL PARTNER (OSSUR) INCLUDING DOCUMENTATION OF ALL ELEMENTS OF THE UPPER LIMB PRODUCT; BUILD OF INITIAL CLINICAL IMES INFINITY UNITS WAS STARTED AT THE FOUNDATION; EVALUATION WAS DONE ON POTENTIAL APPROACHES TO REGULATORY APPROVAL WITHIN THE US AND POTENTIALLY IN EUROPE. 1504687 0 0 SLEEP APNEA AMF IS INVESTIGATING THE NEED FOR NEWER METHODS TO TREAT OSA (OBSTRUCTIVE SLEEP APNEA). OSA IS AN UNDER-DIAGNOSED AND UNDER-TREATED MEDICAL CONDITION THAT HAS BEEN LINKED TO SEVERAL SERIOUS CO-MORBIDITIES, INCLUDING HEART DISEASE. CURRENT TREATMENT OPTIONS ARE POORLY TOLERATED AND WHEN ADOPTED, HAVE LOW COMPLIANCE RATES. THE AIM OF THE AMF PROGRAM IS TO DEVELOP A NEUROSTIMULATION SYSTEM THAT WILL IMPROVE MEDICAL OUTCOMES AT A LOWER COST THAN CURRENTLY AVAILABLE TREATMENT OPTIONS, WHILE SOLVING THE PATIENT COMPLIANCE ISSUE. SUCH A PRODUCT SYSTEM WILL CONSIST OF A FULLY IMPLANTABLE NEURAL STIMULATOR SENSOR, CLOSED LOOP SYSTEM WITH SEAMLESS OPERATION REQUIRING MINIMAL INTERACTION FROM A PATIENT, THEREBY OFFERING A HIGHER LEVEL OF PATIENT SATISFACTION AND ADOPTION.STATUS:A NEW MECHANICAL DESIGN WAS DEVELOPED AND BUILT INTO DEMO UNITS; PROTOTYPE ELECTRONICS CIRCUITY FOR DEMONSTRATION PURPOSES HAS BEEN DEVELOPED AND BUILT INTO FORM FACTOR UNITS; DEMONSTRATION SOFTWARE WAS DEVELOPED TO DISPLAY RESPIRATION DATA ON A TABLET COMPUTER; ADDITIONAL DISCUSSIONS HELD WITH POTENTIAL COMMERCIAL PARTNERS IN AN EFFORT TO OBTAIN FUNDING 7404150 0 1855266 NEW PROJECT DEVELOPMENT AND PROTECTIONTHIS PROGRAM COVERS (A) THE MONITORING AND EVALUATION OF SEVERAL EARLY STAGE ADVANCED RESEARCH AND DEVELOPMENT EFFORTS UNDERWAY THAT ARE DIRECTED AT DEVELOPING ADVANCED TECHNOLOGIES, PROJECT IDEAS AND CONCEPTS BEFORE THEY ARE ELEVATED TO THE STATUS OF FULL-FLEDGED DEVELOPMENT PROGRAMS, AND (B) ONGOING EFFORTS RELATED TO THE ADVANCEMENT OF COMMERCIAL DEVELOPMENT AND PROTECTION OF INTELLECTUAL PROPERTY OF THESE PROJECTS FROM THE TIME THEY ARE ELEVATED TO DEVELOPMENT PROGRAMS AND CONTINUING SOMETIMES UNTIL LONG AFTER THESE PROJECTS HAVE BEEN LAUNCHED INTO SPINOUT COMPANIES OR LICENSED TO COMMERCIAL ENTITIES. THE TEAM COMPRISES THE FULL RANGE OF EXPERTISE AVAILABLE AT AMF, INCLUDING SENIOR EXECUTIVE MANAGEMENT, RESEARCH SCIENTISTS AND ENGINEERS, LEGAL AND INTELLECTUAL PROPERTY EXPERTS, BUSINESS STRATEGISTS AND ANALYSTS. EXPENSES MAY INCLUDE ONGOING PARTICIPATION IN THE DEVELOPMENT EFFORT INCLUDING RESEARCH AND DEVELOPMENT SUPPORT, COLLABORATION MANAGEMENT, SERVICE IN MANAGEMENT OR ON THE BOARD OF DIRECTORS OF SPINOUT ENTITIES, PATENT PROSECUTION AND THE PROSECUTION OF INFRINGEMENT ACTIONS TO PROTECT THE VALUE OF THE INTELLECTUAL PROPERTY WE CREATE. IN ADDITION TO PAYROLL EXPENSES AND DIRECT EXPENSES PAID TO OUTSIDE VENDORS FOR GOODS AND SERVICES RELATED TO PROJECTS, EXPENSES IN THIS PROGRAM MAY INCLUDE PATENT PROSECUTION EXPENSES AND FEES, LEGAL FEES (FOR INTERNAL AND OUTSIDE LEGAL COUNSEL) FOR LITIGATION EXPENSES TO CREATE, PRESERVE AND PROTECT INTELLECTUAL PROPERTY FROM INFRINGEMENT AND REMEDY PAST INFRINGEMENT, AND INCENTIVE AND OTHER COMPENSATION PAYMENTS TO EMPLOYEES AND OTHERS RELATED TO THESE PROGRAMS AND ACTIONS. DEPENDING ON FACTS AND CIRCUMSTANCES, IN SOME CASES CERTAIN OF THESE EXPENDITURES MIGHT BE INCURRED LONG AFTER THE PROJECTS HAVE BEEN LAUNCHED INTO SPINOUT COMPANIES OR LICENSED TO THIRD PARTIES.REVENUES ASSOCIATED WITH THESE PROJECTS (SOME OF WHICH MAY ACCRUE LONG AFTER THE PROJECT AND ANY RELATED PROGRAM HAVE BEEN OUT-LICENSED OR LAUNCHED INTO A SPINOUT COMPANY) MAY INCLUDE RECOVERIES OF JUDGMENTS OR SETTLEMENTS FROM PATENT INFRINGEMENT LITIGATION, ROYALTIES ON NET SALES OF LICENSED PRODUCTS, MILESTONE PAYMENTS, ONGOING CONTRACT R&D FROM PARTNERS, LICENSEES AND SPINOUT COMPANIES, INTEREST, AND PROCEEDS OF LIQUIDITY EVENTS (E.G., INITIAL PUBLIC OFFERINGS, ACQUISITIONS) INVOLVING RETAINED EQUITY INTERESTS IN PROJECTS THAT HAVE BEEN SPUN OUT INTO STARTUP COMPANIES. STATUS:MAJOR EFFORTS WERE MADE IN THIS AREA RESULTING IN A NUMBER OF NEW POTENTIAL PROJECTS; OVER 40 POTENTIAL INDICATIONS WERE REVIEWED TO FOCUS IN ON A SMALL NUMBER OF KEY AREAS WITH DEVELOPMENT POTENTIAL; FURTHER ANALYSIS WAS PERFORMED ON THIS SUBSET AND PRIORITIES WERE SET FOR EACH OF THE FINALISTS; INCENTIVE COMPENSATION PAYMENTS WERE ISSUED TO PARTICIPANTS IN A LONG-TERM INCENTIVE PLAN RELATED TO A LIQUIDITY EVENT ASSOCIATED WITH A PROJECT LAUNCHED IN 2013; LEGAL EXPENSES CONTINUED TO BE ACCRUED IN CONNECTION WITH ONGOING PATENT INFRINGEMENT LITIGATION RELATING TO COCHLEAR IMPLANT INTELLECTUAL PROPERTY OWNED BY AMF 367364 0 254998 ORION TMTHE FOUNDATION IS SUPPORTING THE DEVELOPMENT OF A NEW GROUNDBREAKING VISUAL CORTICAL PROSTHESIS THAT WILL ENABLE THE PARTIAL RESTORATION OF VISION TO HUNDREDS OF THOUSANDS OF PATIENTS IN THE US SUFFERING FROM DISORDERS SUCH AS DIABETIC RETINOPATHY, GLAUCOMA, OR TRAUMA TO THE EYES OR OPTIC NERVE. IT IS A FULLY-IMPLANTABLE, NEURAL-INTERFACE SYSTEM CAPABLE OF ELECTRICALLY STIMULATING THE HUMAN VISUAL CORTEX AND RESTORING VISUAL PERCEPTION TO PROFOUNDLY BLIND PATIENTS WHO TODAY HAVE NO OTHER TREATMENT OPTIONS. THIS HIGH-DENSITY CORTICAL STIMULATION PROSTHESIS, CALLED THE ORION TM, HAS AN ARRAY SPECIFICALLY DESIGNED FOR THE VISUAL CORTEX. THE GOAL OF THIS PROJECT IS TO FINALIZE THE DESIGN OF THE CORTICAL PROSTHESIS THROUGH AN IDE EARLY FEASIBILITY HUMAN CLINICAL TRIAL. STATUS:INITIAL CLINICAL TRIAL RESULTS IN THE FIRST PATIENTS ARE VERY POSITIVE; THE FOUNDATION HAS BEEN KEY IN THE PROGRAM MANAGEMENT BY PROVIDING ONE OF THE PRINCIPLE INVESTIGATORS; IN ADDITION, THE FOUNDATION HAS BEEN SUPPORTING VARIOUS MECHANICAL AND ELECTRICAL ENGINEERING ACTIVITIES; FOUNDATION MAY INCREASE SUPPORT LEVEL FOR THE PROGRAM 151988 0 0 IMPLANTABLE DRUG PUMPTHE IMPLANTABLE DRUG PUMP (IDP) PROGRAM WAS ONCE AN INTERNAL AMF PROGRAM THAT WAS SPUN OUT INTO A FOR-PROFIT SUBSIDIARY, MEDALLION THERAPEUTICS, INC. THAT FOR PROFIT EFFORT WAS NOT SUCCESSFUL, LEADING AMF TO CEASE OPERATIONS OF THIS SUBSIDIARY, WIND DOWN THE BUSINESS, AND BRING BACK INTO AMF ALL INTELLECTUAL PROPERTY AND OTHER ASSETS RELATING TO THE IDP, ALL OF WHICH OCCURRED IN LATE 2019. SINCE THAT TIME, AMF HAS CONTINUED TO SEARCH FOR SUITABLE PARTNERS TO DEVELOP THE IDP FURTHER IN CERTAIN FIELDS OF USE REQUIRING DRUG DELIVERY FOR CHRONIC CONDITIONS. THE IDP IS A SOPHISTICATED, HIGHLY PROGRAMMABLE DRUG INFUSION DEVICE THAT IS IMPLANTED IN THE ABDOMEN AND REFILLED VIA A HYPODERMIC NEEDLE THROUGH THE SKIN. INFUSION RATES AND SCHEDULES MAY BE PROGRAMMED, AND VIA VARIOUS FORMS OF CATHETERS, DRUGS CAN BE DELIVERED INTRATHECALLY TO THE SPINAL COLUMN, INTO THE ABDOMEN, INTO THE BRAIN, OR INTRAVENOUSLY. STATUS: SEVERAL DISCUSSIONS HAVE BEEN INITIATED DIRECTED TOWARDS LICENSING AND COMMERCIALIZING THE IDP IN SEVERAL FIELDS OF USE; AMF HAS EXPLORED AND APPLIED FOR MULTIPLE GRANTS TO FURTHER THE DEVELOPMENT OF THE IDP IN THE FIELD OF PAIN; DESIGN UPDATES AND UPGRADES HAVE BEEN CONSIDERED 519352 0 254998 11183048 1 0 0 0 0 0 0 0 0 0 1 0 0 0 0 1 0 1 0 0 1 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 1 1 1 0 0 1 24 0 1 37 1 1 1 0 0 0 0 0 0 0 0 0 0 0 X 6 5 0 0 1 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 1 1 1 CA X FARAH BOROOMAND 6617026731 25134 RYE CANYON LOOP SANTA CLARITA CA 91355 MARK CHAMBERLAIN CHIEF OPERATING OFFICER 42.00 X 891918 0 42519 JOHN PETROVICH PRESIDENT AND CEO 45.00 X 881173 0 38917 FARAH BOROOMAND CHIEF FINANCIAL OFFICER 44.00 X 812256 0 42301 DAVID HANKIN THRU 73117 FORMER CHIEF EXECUTIVE OFFICER 0.00 X 627628 0 0 ROBERT GREENBERG CHAIRMAN OF THE BOARD/ EXECUTIVE CHAIRMAN 40.00 X X 417921 0 37238 MICHAEL PERRIN VP QUAL. ASSUR., REGULATORY, OPERATIONS 39.00 X 419457 0 25922 BRIAN DEARDEN DIRECTOR, ELECTRICAL ENGINEERING 40.00 X 378746 0 38293 JOSEPH CALDERON DIRECTOR, MECHANICAL ENGINEERING 40.00 X 359843 0 37022 GLEN GRIFFITH THRU 12717 FORMER TECHNICAL DIRECTOR 0.00 X 392967 0 0 SIEGMAR SCHMIDT THRU 12717 FORMER EMERGING TECH. GRP. MGR. 0.00 X 392268 0 0 VALMA KLEIN DIRECTOR, CLINICAL RESEARCH 43.00 X 179182 0 23591 PHILIP LEE ASSISTANT GENERAL COUNSEL 41.00 X 161841 0 29253 SAM BOWMAN PRINCIPAL ENGINEER ELECTRICAL 40.00 X 156404 0 19502 KAREN MORRIS SR. DIRECTOR, HR & FACILITIES MGMT. 40.00 X 146228 0 22660 XIAODONG YANG SYSTEMS VALIDATION GROUP MANAGER 40.00 X 143044 0 23498 HARSHIT SURI PRINCIPAL DESIGN ENGINEER 40.00 X 148957 0 8982 MARI DANIHEL BOARD MEMBER 2.00 X 0 0 0 KEN WEATHERWAX BOARD MEMBER 1.50 X 0 0 0 RICHARD WAUGH BOARD MEMBER 2.00 X 0 0 0 DAVID GILL STARTED 3302020 BOARD MEMBER 0.00 X 0 0 0 DAVID LONG STARTED 3302020 BOARD MEMBER 0.00 X 0 0 0 6509833 0 389698 19 1 1 0 COMPUTER PACKAGES INC 11 N WASHINGTON STREET SUITE 300 ROCKVILLE MD 20850 PATENT RENEWALS 101352 1 936 936 OTHER PROGRAM REVENUE 900099 326111 326111 IMES II PROGRAM REVENUE 900099 306131 306131 RESEARCH GRANT INCOME 900099 254998 254998 887240 120258 24238 96020 1529155 1529155 6953666 5029299 2149482 1924367 -2149482 -225115 -225115 2312474 2416395 24238 -129095 5000 5000 5407904 4077201 1330703 3059257 2617818 441439 38885 30239 8646 481433 405134 76299 353685 280603 73082 2220990 2091776 129214 82550 7165 75385 290386 166851 123535 390255 320210 70045 129367 86259 43108 879887 685242 194645 38169 27372 10797 14396 7788 6608 295862 237328 58534 65836 51280 14556 MISCELLANEOUS 85596 70320 15276 EDUCATION & MORALE 19650 15462 4188 13859108 11183048 2676060 0 1602272 868093 294449 10066791 68434 8361 1258458 101460 92936 8195105 7553934 775444 641171 319084 40819608 88801381 2457544 916321 1571358 650506 1286694 93529351 59071014 1095338 3490776 6000000 8000000 7095338 11490776 X 86434013 47580238 86434013 47580238 93529351 59071014 X -11546634 4880310 237627 -32425078 X 0 1 X 1 0 X WALTER REED NATIONAL MILITARY MEDICAL CENTER BETHESDA MD UCLA FOUNDATION LOS ANGELES CA 1235890 713560 522330 4906175 4805450 100725 2053040 2034924 18116 641171 X 7192784 4880310 4880310 2312474 0 2312474 13859108 0 13859108 0 13859108 PART X, LINE 2: THE ALFRED E. MANN FOUNDATION FOR SCIENTIFIC RESEARCH IS EXEMPT FROM FEDERAL INCOME AND CALIFORNIA FRANCHISE TAXES UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE AND THE CORRESPONDING CALIFORNIA PROVISIONS. THE FOUNDATION'S SUBSIDIARIES ARE C CORPORATIONS AND ARE SUBJECT TO FEDERAL INCOME AND CALIFORNIA FRANCHISE TAXES. THE ALFRED E. MANN FOUNDATION FOR SCIENTIFIC RESEARCH HAD NO SIGNIFICANT UNRELATED BUSINESS INCOME TAX DURING THE YEARS ENDED MARCH 31, 2020 AND 2019. ACCORDINGLY, NO TAX PROVISION FOR UNRELATED BUSINESS INCOME HAS BEEN MADE IN THE ACCOMPANYING CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED MARCH 31, 2020 AND 2019. MEDALLION AND MONOLYTHIX ARE FOR-PROFIT ENTITIES. INCOME TAXES FOR THESE ENTITIES ARE PROVIDED FOR UNDER THE LIABILITY METHOD, AND AS SUCH, DEFERRED INCOME TAXES ARE RECOGNIZED FOR THE TAX CONSEQUENCES OF TEMPORARY DIFFERENCES BY APPLYING ENACTED STATUTORY TAX RATES APPLICABLE TO FUTURE YEARS TO DIFFERENCES BETWEEN THE CONSOLIDATED FINANCIAL STATEMENT CARRYING AMOUNTS AND THE TAX BASIS OF EXISTING ASSETS AND LIABILITIES. A VALUATION ALLOWANCE REDUCES DEFERRED INCOME TAX ASSETS WHEN IT IS MORE-LIKELY-THAN-NOT THAT SOME PORTION OR ALL OF THE DEFERRED INCOME TAX ASSETS WILL NOT BE REALIZED. THE TEMPORARY DIFFERENCES CONSISTED PRIMARILY OF NET OPERATING LOSS CARRY FORWARDS, WHICH EXPIRE ON VARIOUS DATES THROUGH 2026. AT MARCH 31, 2019, MEDALLION AND MONOLYTHIX, SUBSIDIARIES OF THE FOUNDATION, HAD NO DEFERRED TAX ASSETS. DURING THE YEAR ENDED MARCH 31, 2020, THE SUBSIDIARIES OF THE FOUNDATION DISSOLVED. THE FOUNDATION, UNDER THE PROVISIONS OF ASC 740, INCOME TAXES, HAD NO UNCERTAIN TAX POSITIONS REQUIRING ACCRUAL AS OF MARCH 31, 2020 AND 2019. CENTRAL AMERICA AND THE CARIBBEAN 0 0 INVESTMENTS 467914 CENTRAL AMERICA AND THE CARIBBEAN 0 0 INVESTMENT FEE EXPENDITURES 120 0 0 0 0 0 0 468034 0 468034 1 0 1 1 1 0 PART I, LINE 3: THE ACCRUAL METHOD OF ACCOUNTING IS USED FOR BOTH AMOUNTS REPORTED AS INVESTMENTS AND EXPENDITURES. PART III ACCOUNTING METHOD: X X X 0 0 0 0 0 0 0 1 0 MARK CHAMBERLAIN CHIEF OPERATING OFFICER 294470 0 597448 0 0 0 5599 0 36920 0 934437 0 0 0 JOHN PETROVICH PRESIDENT AND CEO 342147 0 539026 0 0 0 5599 0 33318 0 920090 0 0 0 FARAH BOROOMAND CHIEF FINANCIAL OFFICER 247308 0 564948 0 0 0 5599 0 36702 0 854557 0 0 0 DAVID HANKIN THRU 73117 FORMER CHIEF EXECUTIVE OFFICER 0 0 627628 0 0 0 0 0 0 0 627628 0 0 0 ROBERT GREENBERG CHAIRMAN OF THE BOARD/ EXECUTIVE CHA 415921 0 2000 0 0 0 5599 0 31639 0 455159 0 0 0 MICHAEL PERRIN VP QUAL. ASSUR., REGULATORY, OPERATI 171096 0 248361 0 0 0 3477 0 22445 0 445379 0 0 0 BRIAN DEARDEN DIRECTOR, ELECTRICAL ENGINEERING 170212 0 208534 0 0 0 5599 0 32694 0 417039 0 0 0 JOSEPH CALDERON DIRECTOR, MECHANICAL ENGINEERING 151709 0 208134 0 0 0 5599 0 31423 0 396865 0 0 0 GLEN GRIFFITH THRU 12717 FORMER TECHNICAL DIRECTOR 699 0 392268 0 0 0 0 0 0 0 392967 0 0 0 SIEGMAR SCHMIDT THRU 12717 FORMER EMERGING TECH. GRP. MGR. 0 0 392268 0 0 0 0 0 0 0 392268 0 0 0 VALMA KLEIN DIRECTOR, CLINICAL RESEARCH 166982 0 12200 0 0 0 3234 0 20357 0 202773 0 0 0 PHILIP LEE ASSISTANT GENERAL COUNSEL 152841 0 9000 0 0 0 3141 0 26112 0 191094 0 0 0 SAM BOWMAN PRINCIPAL ENGINEER ELECTRICAL 146404 0 10000 0 0 0 2798 0 16704 0 175906 0 0 0 KAREN MORRIS SR. DIRECTOR, HR & FACILITIES MGMT. 141728 0 4500 0 0 0 2826 0 19834 0 168888 0 0 0 XIAODONG YANG SYSTEMS VALIDATION GROUP MANAGER 138044 0 5000 0 0 0 2798 0 20700 0 166542 0 0 0 HARSHIT SURI PRINCIPAL DESIGN ENGINEER 136957 0 12000 0 0 0 2991 0 5991 0 157939 0 0 0 PART I, LINE 7 REGULAR ANNUAL BONUSES ARE PAID PURSUANT TO AMF'S ANNUAL INCENTIVE PLAN, WHICH IS REVIEWED, RENEWED AND APPROVED EACH YEAR BY THE BOARD OF DIRECTORS. THESE BONUSES ARE BASED ON ACHIEVEMENT OF PERSONAL AND CORPORATE GOALS, AMONG OTHER CONSIDERATIONS, AND ARE APPROVED BY THE BOARD OF DIRECTORS. ADDITIONALLY, BONUSES WERE PAID THIS YEAR FOR THE FIRST TIME UNDER AN INCENTIVE COMPENSATION PLAN KNOWN AS THE ALFRED MANN FOUNDATION FOR SCIENTIFIC RESEARCH INCENTIVE COMPENSATION PLAN - AXONICS MODULATION TECHNOLOGIES, INC. (THE "PLAN"), AND WAS APPROVED BY THE BOARD OF DIRECTORS EFFECTIVE AS OF APRIL 1, 2014, AS AMENDED AND RESTATED ON AUGUST 3, 2016. THE PLAN IS ALSO REFERRED TO AS A LONG-TERM INCENTIVE PLAN, OR "LTIP". AS STATED IN THE PLAN, "THE PURPOSE OF THE PLAN IS TO ENHANCE THE ABILITY OF AMF TO ATTRACT AND RETAIN HIGHLY QUALIFIED EMPLOYEES BY PROVIDING INCENTIVE COMPENSATION OPPORTUNITIES. TO THE EXTENT THE PLAN PROVIDES FOR A DEFERRAL OF COMPENSATION, THE PLAN IS INTENDED TO BE AN INELIGIBLE DEFERRED COMPENSATION PLAN WITHIN THE MEANING OF SECTION 457(F) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE")." THE PLAN IS INTENDED TO BE A NONQUALIFIED DEFERRED COMPENSATION PLAN WITHIN THE MEANING OF CODE SECTION 457(F), AND AS SUCH PARTICIPATION IS LIMITED TO EMPLOYEES WHO (I) QUALIFY FOR INCLUSION IN A SELECT GROUP OF MANAGEMENT OR HIGHLY COMPENSATED EMPLOYEES" WITHIN THE MEANING OF ERISA SECTIONS 201(2), 301(A)(3) AND 401(A)(1), AND (II) ARE DESIGNATED BY THE COMMITTEE TO BE ELIGIBLE FOR A COMPENSATION AWARD. EMPLOYEES DESIGNATED TO RECEIVE AWARDS ENTER INTO AN INDIVIDUAL AWARD AGREEMENTS UNDER THE PLAN. GENERALLY SPEAKING, AWARDS ARE PAID UPON THE OCCURRENCE OF CERTAIN EVENTS (IN THIS CASE, A LIQUIDITY EVENT, AS DEFINED IN THE AWARD AGREEMENT) RELATING TO STOCK OF AXONICS MODULATION TECHNOLOGIES, INC. OWNED BY AMF (AXONICS IS A FOR-PROFIT SPINOUT COMPANY LAUNCHED IN 2013 BY AMF TO COMMERCIALIZE IMPLANTABLE STIMULATOR TECHNOLOGIES; AXONICS CONSUMMATED AN INITIAL PUBLIC OFFERING OF ITS STOCK IN OCTOBER 2018, TRIGGERING AN AWARD PAYMENT UNDER THE PLAN). AWARDS ARE ALSO PAID UPON THE RECEIPT BY AMF FROM AXONICS OF ROYALTIES UNDER A LICENSE AGREEMENT BETWEEN AMF AND AXONICS COVERING CERTAIN AMF PATENTS AND OTHER INTELLECTUAL PROPERTY LICENSED TO AXONICS. PLAN AWARDS PROVIDE LONG-TERM, DEFERRED INCENTIVE COMPENSATION TO AWARD RECIPIENTS MEANT TO SERVE AS A GENERAL EMPLOYEE RETENTION TOOL, AND ALSO TO REWARD KEY PARTICIPANTS IN THE UNDERLYING PROJECT OR RESEARCH EFFORT THAT WAS THE SUBJECT OF THE LTIP. UPON ACTUAL RECEIPT BY AMF OF PROCEEDS OF A LIQUIDITY EVENT (AND AFTER DEDUCTING CERTAIN AMOUNTS DESIGNED TO REIMBURSE AMF FOR ITS COSTS OF THE UNDERLYING ASSET), AN AWARD POOL IS CREATED AND AWARD RECIPIENTS ARE PAID A PERCENTAGE OF THE NET PROCEEDS RECEIVED BY AMF. TYPICALLY, THE TOTAL AWARDS TO ALL RECIPIENTS IN ANY PLAN DO NOT EXCEED 12.00% OF THE AMOUNT OF NET PROCEEDS REALIZED BY AMF. NO AMOUNTS ARE PAYABLE UNLESS AND UNTIL AMF HAS ACTUALLY RECEIVED THE PROCEEDS OF A LIQUIDITY EVENT OR ROYALTIES UNDER THE LICENSE AGREEMENT. THE AWARDS ARE SUBJECT TO SEVERAL CONDITIONS, DESIGNED TO PROVIDE A SUBSTANTIAL RISK OF FORFEITURE TO THE AWARD RECIPIENT. AMONG THESE CONDITIONS AND RISKS ARE: - THE RISK OF FORFEITURE IF THE RECIPIENT LEAVES THE EMPLOY OF AMF OR IS TERMINATED PRIOR TO VESTING (THERE IS A 5 YEAR VESTING PERIOD FOR THE AWARD, AND AWARDS FURTHER DO NOT VEST EVEN DURING THIS 5 YEAR PERIOD TO THE EXTENT THAT A LIQUIDITY EVENT SHALL NOT HAVE YET OCCURRED). THERE ARE VERY LIMITED EXCEPTIONS FOR RETIREMENT, DEATH AND DISABILITY. - THE RISK THAT THE PROCEEDS OF A LIQUIDITY EVENT WILL FAIL TO EXCEED PREDETERMINED COST REIMBURSEMENT HURDLES THAT ARE BUILT INTO EACH AWARD AGREEMENT. - THE RISK THAT THE UNDERLYING PROJECT OR SPINOUT COMPANY FAILS TO ACHIEVE A LIQUIDITY EVENT AT ALL. - THERE ARE ANNUAL AND CUMULATIVE CAPS TO THE PAYMENT OF AWARDS UNDER THE AWARD AGREEMENT. - RESTRICTIONS SET FORTH IN EACH AWARD AGREEMENT LIMIT THE MAXIMUM AMOUNT OF PROCEEDS TO WHICH A RECIPIENT'S AWARD PERCENTAGE WILL APPLY. THE PLAN AND EACH AWARD AGREEMENT WERE APPROVED BY THE BOARD OF DIRECTORS AFTER REVIEWING DETAILED COMPENSATION ANALYSIS INFORMATION PREPARED BY AN INDEPENDENT FIRM AND RECEIVING OUTSIDE LEGAL ADVICE, BOTH RELATING TO THE REASONABLENESS OF THE LTIP COMPENSATION. THE LTIP REQUIRES THAT THIS COMPENSATION ANALYSIS BE UPDATED EVERY TWO YEARS, AND THIS WAS DONE IN 2016, 2018 AND MOST RECENTLY IN 2020. IN THE 2020 ANALYSIS, THE COMPENSATION OF THE EXECUTIVE CHAIRMAN WAS ALSO PERFORMED. THE FOREGOING DESCRIPTIONS ARE QUALIFIED BY REFERENCE TO THE ACTUAL PLAN AND RELATED AWARD AGREEMENTS. MONOLYTHIX, INC. 2020-03-26 5364195 ACTUAL COST MEDALLION THERAPEUTICS, INC. 2019-12-09 30901152 ACTUAL COST 0 0 0 0 SCHEDULE N, PART II IN DECEMBER 2019, THE FOUNDATION DISSOLVED MEDALLION THERAPEUTICS, INC. ALL ASSETS AND LIABILITIES OF THE ENTITY WERE TRANSFERRED TO THE FOUNDATION IN ACCORDANCE WITH THE DISSOLUTION. IN JANUARY 2020, MONOLYTHIX, INC. SOLD CERTAIN INTELLECTUAL PROPERTY AND FIXED ASSETS TO AN UNRELATED THIRD-PARTY ENTITY IN EXCHANGE FOR A NOTE RECEIVABLE AND A MINORITY EQUITY INTEREST IN THE THIRD-PARTY ENTITY. SUBSEQUENT TO THIS SALE, MONOLYTHIX, INC. WAS DISSOLVED BY THE FOUNDATION AND ANY REMAINING ASSETS AND LIABILITIES WERE TRANSFERRED TO THE FOUNDATION. FORM 990, PART VI, SECTION A, LINE 4 ARTICLE VII OF THE AMENDED AND RESTATED ARTICLES OF INCORPORATION OF THIS CORPORATION IS AMENDED TO READ AS FOLLOWS: THE PROPERTY OF THIS CORPORATION IS IRREVOCABLY DEDICATED TO CHARITABLE AND SCIENTIFIC PURPOSES MEETING THE REQUIREMENTS OF CALIFORNIA REVENUE AND TAXATION CODE SECTION 214. UPON THE DISSOLUTION OR WINDING UP OF THIS CORPORATION, AFTER PAYING OR ADEQUATELY PROVIDING FOR THE DEBTS AND OBLIGATIONS THEREOF, ANY REMAINING ASSETS SHALL BE DISTRIBUTED, FOR USE IN FURTHERANCE OF THE PURPOSES OF THIS CORPORATION AS SET FORTH ABOVE IN THOSE ARTICLES OF INCORPORATION TO ONE OR MORE NONPROFIT FUNDS, FOUNDATIONS OR CORPORATIONS, WHICH ARE THEN IN EXISTENCE, WHICH ARE ORGANIZED AND OPERATED EXCLUSIVELY FOR CHARITABLE AND SCIENTIFIC PURPOSES MEETING THE REQUIREMENTS OF REVENUE AND TAXATION CODE SECTION 214, AND WHICH HAVE ESTABLISHED THEIR TAX EXEMPT STATUS A SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE OF 1986 AS AMENDED (OR ANY CORRESPONDING PROVISION OF FUTURE UNITED STATES INTERNAL REVENUE LAW). FORM 990, PART VI, SECTION B, LINE 11B A DRAFT OF THE 990 WILL BE PRESENTED BY MANAGEMENT TO THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS FOR THEIR REVIEW AND DISCUSSION. A FULL COPY OF THE FORM WILL BE PROVIDED TO ALL VOTING MEMBERS PRIOR TO FILING WITH THE IRS. FORM 990, PART VI, SECTION B, LINE 12C CONFLICT OF INTEREST DISCLOSURES ARE UPDATED ANNUALLY AND POTENTIAL CONFLICTS ARE REVIEWED PRIOR TO PARTICIPATING IN TRANSACTIONS. IF A CONFLICT EXISTS, THE PERSON WITH A CONFLICT DOES NOT VOTE. FORM 990, PART VI, SECTION B, LINE 15 THE BOARD OF DIRECTORS REVIEWS AND APPROVES THE COMPENSATION OF THE CEO AND HIS DIRECT REPORTS INCLUDING THE CFO. THEY ALSO REVIEW AND APPROVE THE OVERALL ANNUAL ADJUSTMENTS TO COMPENSATION OF OTHER EMPLOYEES. SPECIFIC ADJUSTMENTS FOR OTHER EMPLOYEES ARE HANDLED BY THE CEO AND HEAD OF HUMAN RESOURCES USING COMPARISONS TO SALARY SURVEYS FOR SIMILAR POSITIONS AND EXPERIENCE. THE BOARD OF DIRECTORS APPROVED COMPENSATION FOR THE CEO AND HIS DIRECT REPORTS INCLUDING THE CFO AND THE EXECUTIVE CHAIRMAN, ON 4/09/20. THIS PROCESS WAS DOCUMENTED. FORM 990, PART VI, SECTION C, LINE 19 MEMBERS OF THE PUBLIC OR INTERESTED PARTIES MAY REQUEST TO REVIEW OR RECIEVE A COPY OF THE GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS BY PHONE OR MAIL. FORM 990, PART XI, LINE 9: DISSOLUTION OF MEDALLION -29,281,859. DISSOLUTION OF MONOLYTHIX -3,143,219. MONOLYTHIX INC 25134 RYE CANYON LOOP VALENCIA CA 91355 464616473 MONOLITHIC STRUCTURE DEVELOPMENT FOR DISEASE DETECTION, BLOOD ANALYSIS, AND NV ALFRED E MANN FOUNDATION FOR SCIENTIFIC RESEARCH C -79998 22280 0.73530 1 MEDALLION THERAPEUTICS INC 25134 RYE CANYON LOOP VALENCIA CA 91355 464651082 DEVELOPMENT AND COMMERCIALIZATION OF MEDICAL DEVICE (IMPLANTABLE DRUG PUMP) DE ALFRED E MANN FOUNDATION FOR SCIENTIFIC RESEARCH C -17692318 1 1 0 0 1 0 0 0 0 0 0 0 0 0 1 1 0 1 0 1 MONOLYTHIX INC A 24238 LOAN MONOLYTHIX INC D 24238 INTEREST INCOME MONOLYTHIX INC S 1073593 FMV MEDALLION THERAPEUTICS INC S 2064562 APPRAISAL