Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Appointment of President and Chief Executive Officer
On July 23, 2021, the Board of Directors (the "Board") of EyeGate
Pharmaceuticals, Inc. (the "Company") appointed Brian M. Strem, Ph.D. as
President and Chief Executive Officer of the Company, effective as of July 26,
2021 (the "Effective Date").
Dr. Strem, age 42, is a co-founder of Yellowbrick Bio LLC d/b/a Bayon
Therapeutics ("Bayon"), an ophthalmological pharmaceutical company based on a
novel, light responsive small molecule platform. Dr. Strem is a co-founder of
Okogen, Inc., a development stage ophthalmic company focused on a novel
therapeutic for the treatment of viral infections of the eye, and served as its
CEO from May 2015 through July 2021. Prior to founding Okogen, Dr. Strem worked
at Sound Pharmaceuticals, Inc., Allergan, Inc. and Shire, Plc, where he was
responsible for business development and corporate strategy in ophthalmology,
otology and regenerative medicine. Dr. Strem began his career at Cytori
Therapeutics with elevating roles within the commercial and research and
development departments. Dr. Strem received a BS in bioengineering from Cornell
University and a Ph.D. in biomedical engineering from the University of
California, Los Angeles.
In connection with the appointment of Dr. Strem, Franz Obermayr, Ph.D., who has
served as the Company's Acting Chief Executive Officer since February 2021,
resumed his prior role with the Company as its EVP Clinical Development,
effective as of the Effective Date.
Appointment of Director
In connection with Dr. Strem's appointment as President and Chief Executive
Officer and pursuant to the terms of the Employment Agreement, the Board, upon
the recommendation of its Nominating and Corporate Governance Committee,
increased the size of the Board from seven to eight members, and appointed Dr.
Strem as a Class I director to fill the resulting vacancy, in each case
effective as of the Effective Date, to serve in office until the 2022 annual
meeting of stockholders or until his successor is duly elected and qualified or
until his earlier resignation or removal. Dr. Strem will not receive any
compensation in connection with his service as a member of the Board.
Employment Agreement
In connection with Dr. Strem's appointment as President and Chief Executive
Officer, on July 22, 2021, the Company entered into an Employment Agreement (the
"Employment Agreement") with Dr. Strem. Pursuant to the Agreement, Dr. Strem
will receive an annual base salary of $400,000 and he is entitled to receive a
performance bonus with a target of up to 50% of his annual base salary for the
applicable fiscal year.
Pursuant to the Employment Agreement, as of the Effective Date, the Company
granted Dr. Strem an option to purchase up to 100,000 shares of the Company's
common stock (the "Option"). The Option will vest with respect to one-third of
the underlying shares on the one-year anniversary of the grant date, and
thereafter will vest in equal monthly installments over a two-year period. Dr.
Strem will also be entitled to receive two further options to purchase an
aggregate of up to 100,000 shares of the Company's common stock based on the
achievement of market capitalization-based milestones as set forth in the
Employment Agreement.
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If the Company terminates Dr. Strem's employment without Cause or he resigns for
Good Reason (as such terms are defined in the Employment Agreement), then Dr.
Strem will be eligible to receive (i) continued payment of base salary for 3
months, which period will be extended to 6 months if the termination date is
between 18 and 36 months following the Effective Date and will be extended to 12
months if the termination date is on or after the 36-month anniversary of the
Effective Date or if termination occurs following a Change of Control (as such
term is defined in the Employment Agreement) of the Company; (ii) a lump-sum
cash payment, payable no later than the last installment of his severance, equal
to 0.25 multiplied by the maximum performance bonus that he would have been
eligible to receive in the year of termination, which multiple will be increased
to 0.5 if the termination date is between 18 and 36 months following the
Effective Date and will be increased to 1.0 if the termination date is on or
after the 36-month anniversary of the Effective Date or if termination occurs
following a Change of Control of the Company; and (iii) payment by the Company
of monthly premiums under COBRA for up to 3 months following termination, which
period will be extended to 6 months if the termination date is between 18 and 36
months following the Effective Date and will be extended to 12 months if the
termination date is on or after the 36-month anniversary of the Effective Date
or if termination occurs following a Change of Control of the Company.
Additionally, if the Company terminates Dr. Strem's employment without Cause or
he resigns for Good Reason, then that portion of his then unvested stock options
and restricted stock awards that would have otherwise become vested over the 3
month period following such termination shall become fully vested and
immediately exercisable on the date of such termination, which period will be
extended to 6 months if the termination date is between 18 and 36 months
following the Effective Date and will be extended to 12 months if the
termination date is on or after the 36-month anniversary of the Effective Date.
In the event that a Change of Control of the Company occurs, all of Dr. Strem's
unvested stock options and restricted stock awards shall become fully vested and
immediately exercisable.
Non-Binding Term Sheet
On July 22, 2021, the Company entered into a non-binding term sheet (the "Term
Sheet") with Bayon. Dr. Strem is a founder of Bayon and owns approximately 28%
of its equity interests. Pursuant to the Term Sheet, the Company and Bayon
intend to negotiate and enter into a definitive agreement pursuant to which the
Company would acquire Bayon in connection for closing consideration of 50,000
shares of the Company's common stock, and potential earnout consideration of up
to approximately $7.1 million or, in the Company's discretion, up to
approximately 2.2 million shares of the Company's common stock or common stock
equivalents, based on the achievement of successive milestones based on clinical
trial data and regulatory approval of Bayon products. To the extent the Bayon
acquisition is consummated, Dr. Strem will receive a portion of the
consideration equal to his percentage ownership in Bayon. There can be no
assurance that a definitive agreement will be entered into or that the proposed
transaction will be consummated at all or on the terms described in this Current
Report on Form 8-K.
Except as disclosed above, there are no arrangements or understandings between
Dr. Strem and any other person pursuant to which he was appointed to serve as
President and Chief Executive Officer of the Company and a member of the Board.
There are also no family relationships between Dr. Strem and any director or
executive officer of the Company, and except as disclosed above, Dr. Strem does
not have a direct or indirect material interest in any transaction required to
be disclosed pursuant to Item 404(a) of Regulation S-K.
The foregoing description of the Employment Agreement is a summary and does not
purport to be complete. Such description is qualified in its entirety by
reference to the text of the Employment Agreement, which is filed as Exhibit
10.1 to this Current Report on Form 8-K, and is incorporated herein by
reference.
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Item 7.01. Regulation FD Disclosure.
On April 1, 2021, the Company issued a press release announcing the appointment
of Dr. Strem as President and Chief Executive Officer of the Company and the
execution of the Term Sheet. A copy of the press release is furnished as Exhibit
99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information furnished in this Item 7.01 of this Current Report on Form 8-K,
including Exhibit 99.1 hereto, shall not be deemed to be "filed" for purposes of
Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise
subject to the liabilities of that section, nor shall such information be deemed
incorporated by reference in any filing under the Securities Act of 1933, as
amended, except as shall be expressly set forth by specific reference in such a
filing.
Some of the statements in this Current Report on Form 8-K are "forward-looking"
within the meaning of the federal securities laws. These "forward-looking"
statements include statements relating to, among other things, the proposed
terms and conditions of any binding definitive agreement with Bayon, which is
subject to the receipt of all necessary approvals and satisfaction of all
closing conditions for the completion of any such transaction. These statements
involve risks and uncertainties that may cause results to differ materially from
the statements set forth in this Current Report on Form 8-K, including, among
other things, certain risk factors described under the heading "Risk Factors"
contained in the Company's Annual Report on Form 10-K filed with the SEC on
March 25, 2021 or described in the Company's other public filings. The Company's
results may also be affected by factors of which the Company is not currently
aware. The forward-looking statements in this Current Report on Form 8-K speak
only as of the date hereof. The Company expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to such statements to
reflect any change in its expectations with regard thereto or any changes in the
events, conditions or circumstances on which any such statement is based.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
The Company hereby files or furnishes, as applicable, the following exhibits:
10.1# Employment Agreement by and between EyeGate Pharmaceuticals, Inc. and
Brian M. Strem, dated as of July 22, 2021.
99.1 Press Release of EyeGate Pharmaceuticals, Inc. issued on July 26, 2021
# Management contract or compensatory plan or arrangement.
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