Item 1.01 Entry into a Material Definitive Agreement.
On
It should be noted that the Executives have received only 50% of their
applicable base salary since
Pursuant to the Employment Agreements, each of Alfonsi, Teeple, and Ferro will
receive a base salary equal to
Each Executive will also be eligible to receive other cash or stock bonuses as
determined by CANB's board of directors or, once established, its compensation
committee, and will be entitled to participate in any welfare, health and life
insurance and pension benefit and incentive programs, including sick pay and
vacation time, as may be adopted from time to time by the Company. Until the
Company has such plans in place, the Company will reimburse each of Alfonsi,
Teeple, and Ferro up to a maximum amount of
The Company may terminate any Executive's employment under the applicable Employment Agreement with or without cause at any time, and any Executive may resign under the applicable Employment Agreement with or without good reason at any time, by providing written notice to the other party. If CANB terminates an Employment Agreement with cause, or if an Executive resigns without good reason, the Employment Agreement will terminate without further obligation by the Company, except such Executive shall be entitled, if applicable, to all base salary previously earned but not paid, amounts due under benefit plans and profit sharing plans, and reimbursement of business expenses accrued but unpaid through the date of termination. Furthermore, should an Executive be terminated for cause, then all stock options granted to such Executive, whether vested or unvested, shall be forfeited by the Executive and shall terminate.
If an Employment Agreement is terminated by CANB without cause or by Alfonsi, Teeple, or Ferro with good reason prior to the expiration of the initial term, the Company will pay such Executive a severance payment in the amount equal to all base salary due to him for the remainder of the initial term, including consideration for each annual increase as described above. If Scala's Employment Agreement is terminated by CANB without cause or by Scala with good reason, the Company will pay Scala a severance payment in the amount equal to all base salary previously earned but not paid, amounts due under benefit plans and profit sharing plans, and reimbursement of business expenses accrued but unpaid through the date of termination. Notwithstanding the foregoing, the Company's obligation to pay the severance amount to an Executive is conditioned upon such Executive executing a release agreement in the form agreed upon between CANB and the Executive. Additionally, if an Employment Agreement is terminated due to a merger or acquisition, the Company shall arrange to pay each applicable Executive a severance in the amount previously described in this paragraph plus an additional six (6) months' worth of base salary.
If an Employment Agreement is terminated as a result of the death or disability of an Executive, the Company will pay to Alfonsi, Teeple, or Ferro or their respective designee(s), as applicable, all salary, amounts due under benefit plans and profit sharing plans, and reimbursement of business expenses, through the date of termination plus the remaining base salary for the initial term of the applicable Employment Agreement; and will pay to Scala or his designee(s), as applicable, all base salary previously earned but not paid, amounts due under benefit plans and profit sharing plans, and reimbursement of business expenses accrued but unpaid through the date of Scala's death or disability. On the date of termination for any reason, except in the case of termination by the Company for cause, each Executive shall only be entitled to the value of the shares of any class of stock vested on or before the date of termination of employment, if any shares have vested by that date, in accordance with the vesting schedule outlined in the applicable documentation between CANB and the Executive governing the vesting of such shares. As of the date of termination, all vesting options will lapse with respect to all of the Executive's then-unvested shares of any class of stock.
The Company agreed to indemnify each Executive for all claims against him by reason of such Executive being an officer, director, or employee of the Company, as applicable, pursuant to separate indemnity agreements entered into concurrently with the Employment Agreements. Notwithstanding the foregoing, the Company will not indemnify an Executive in the event any claim is the result of such Executive's gross negligence or willful misconduct, or in certain other situations.
The Employment Agreements and the indemnity agreements contemplated thereby otherwise contain standard terms and conditions customary of contracts for these types of transactions.
Item 3.02 Unregistered Sales of
On
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