Fred Leffler
About Fred Leffler
E. Fred Leffler, III is Biofrontera Inc.’s Chief Financial Officer, appointed October 24, 2022; he is 41 years old, holds a BSBA in finance and economics from The Ohio State University and an MBA from Duke University’s Fuqua School of Business . Prior roles include senior positions in strategy, restructuring, and analytics at McKinsey & Company, FTI Consulting, RockCreek, General Electric, and SunEdison, reflecting a finance- and operations-heavy background suited to growth-stage and public companies . His annual cash bonus is tied to performance goals set in advance by the CEO (target 40% of base), and in 2024 he received sizable time-based equity awards (175,000 RSUs and 175,000 options) with multi‑year vesting; specific company TSR/revenue/EBITDA targets were not disclosed in the proxy discussion .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| McKinsey & Company | Senior Manager (Boston) | 2022–2022+ | Strategic/operational leadership consulting for growth and efficiency initiatives . |
| McKinsey & Company | Associate/Senior Manager (Washington, DC) | 2015–2019 | Strategy and performance improvement engagements . |
| FTI Consulting | Senior Director, Corporate Finance & Restructuring | 2020–2022 | Turnaround/restructuring and corporate finance execution . |
| RockCreek | Vice President, Data & Analytics | 2019–2020 | Data-driven investment/analytics leadership . |
| General Electric | Finance roles (various) | — | Early-career finance and operations experience . |
| SunEdison | Finance roles (various) | — | Early-career finance and operations experience . |
Fixed Compensation
| Year | Salary ($) | Signing bonus ($) |
|---|---|---|
| 2022 (partial service) | 54,615 | 25,000 |
| 2023 | 355,000 | — |
| 2024 | 364,194 | — |
Notes:
- Employment agreement base salary rate initially set at $355,000 (annual) .
Performance Compensation
Annual cash bonus (pay-for-performance)
| Year | Target bonus (% of base) | Actual bonus paid ($) | Performance metrics | Vesting/payout timing |
|---|---|---|---|---|
| 2023 | 40% | 23,212 | Goals set in advance by CEO (specific metrics not disclosed) | Annual cash following financial close . |
| 2024 | 40% | 138,308 | Goals set in advance by CEO (specific metrics not disclosed) | Annual cash following financial close . |
Equity awards (time-based)
| Grant date | Instrument | Amount (#) | Price | Vesting schedule start/cadence | Expiration/Settlement |
|---|---|---|---|---|---|
| Jan 10, 2023 | Stock options | 5,000 | $19.40 | 3 equal annual tranches beginning Jan 10, 2024 | Exp. Jan 10, 2033 |
| Jul 12, 2024 | Stock options | 175,000 | $1.38 | 3 equal annual tranches beginning Jul 12, 2025 | Exp. Jul 12, 2034 |
| Jul 12, 2024 | RSUs | 175,000 | — | 2 equal annual tranches beginning Jul 12, 2025 | Settled in shares/cash (or mix) within 60 days of vest |
Equity Ownership & Alignment
- Company ownership guidelines not disclosed; hedging/short sales/derivative trades require pre‑approval and pre‑clearance, and pledging or holding shares in margin accounts also requires prior approval, limiting misalignment risks .
- No executive pledging by Mr. Leffler was disclosed in the proxies reviewed .
Ownership snapshots:
| As-of date | Shares owned | % of total | Options/RSUs vesting/exercisable within 60 days |
|---|---|---|---|
| Apr 15, 2024 | — | — | 1,650 |
| Apr 22, 2025 | — | — | 3,300 |
| Jul 18, 2025 | 87,500 | 1.5% | 61,050 |
Policy highlights:
- Pre‑clearance is required for Covered Persons (includes executive officers) prior to any transaction in company securities; hedging transactions, short sales, and options trading require Compliance Officer approval .
- Pledging or margin use of company securities by Covered Persons requires prior approval due to potential forced sales during blackout or MNPI periods .
Employment Terms
| Term | Key provision |
|---|---|
| Start date/role | Appointed CFO effective Oct 24, 2022 . |
| Base salary | $355,000 annual base under employment agreement (subject to adjustments) . |
| Target bonus | Up to 40% of base; goals set in advance by CEO; no bonus if target achievement <70% . |
| Signing bonus | $25,000 one-time at hire . |
| Initial equity term | Employment agreement provided for an option grant (100,000 options subject to plan terms); subsequent grants disclosed in 2023/2024 (see above) . |
| Severance (no CIC) | Lump sum equal to 1/12 of base salary per full year of service; minimum 6 months, maximum 2 years, contingent on release . |
| Change-in-control (CIC) | If terminated without cause or resigns for good reason within 3 months prior to or 12 months after a CIC: severance equal to current base salary plus target annual bonus, and continuation of health benefits for 12 months (subject to co-pay) . |
| Non‑compete/Non‑solicit | 1‑year post‑termination non‑compete across the U.S.; non‑solicitation during the restricted period . |
| Term/Notice | Indefinite term; either party may terminate on 180 days’ notice (also Cause/Good Reason framework defined) . |
| Clawback | Company adopted Dodd‑Frank compliant clawback effective Oct 2, 2023; recovery of erroneously awarded incentive‑based compensation for the prior 3 completed fiscal years after a required restatement . |
| Insider trading, hedging, pledging | Blackout periods, pre‑clearance required; hedging, shorting and derivatives need prior approval; pledging/margin holdings require prior approval . |
Investment Implications
- Pay-for-performance: Cash bonus is formulaic with a 40% target tied to pre‑set goals; actual payouts ramped materially from $23,212 (2023) to $138,308 (2024), suggesting higher achievement of internal goals in 2024; however, specific revenue/EBITDA/TSR metrics were not disclosed, limiting external assessment of goal rigor .
- Retention and alignment: 2024 equity awards (175,000 RSUs and 175,000 options) vest from July 2025 through 2027 (RSUs in 2025–2026; options in 2025–2027), creating long‑dated retention hooks and equity exposure to BFRI’s operating performance and capital strategy .
- Overhang/settlement dynamics: RSUs settle within 60 days of vesting in shares/cash or a mix at the Company’s discretion, and options have standard 10‑year lives; this structure moderates immediate selling pressure but introduces periodic settlement windows beginning July 2025 .
- Downside protection and CIC economics: The severance floor (6 months) and CIC acceleration (base + target bonus) plus health benefits support retention through strategic events; the 1‑year non‑compete further reduces immediate post‑exit competitive risk .
- Governance risk mitigants: Robust pre‑clearance, hedging/shorting restrictions, and pledging approvals reduce misalignment and margin‑call risk; an updated clawback policy aligns with market standards and protects shareholders in restatement scenarios .
- 2025 capital and strategic actions context: As CFO and named proxy, Leffler was in office as the company pursued a reverse split to maintain Nasdaq compliance and executed a strategic transaction to acquire U.S. rights to key products financed via Series C/D preferred; these steps influence future equity value pathways and his equity incentives’ realizable value .
Appendix: Executive Compensation (Multi‑year summary)
| Year | Salary ($) | Bonus ($) | Stock awards ($) | Option awards ($) | All other comp ($) | Total ($) |
|---|---|---|---|---|---|---|
| 2022 | 54,615 | 25,000 (signing) | — | — | 55 | 79,670 |
| 2023 | 355,000 | 23,212 | — | 63,100 | 366 | 441,678 |
| 2024 | 364,194 | 138,308 | 185,500 | 144,218 | 406 | 832,626 |
All figures as reported in Biofrontera Inc.’s proxy statements for the applicable fiscal years.