Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Employment Agreement with Sean Nolan, Chief Executive Officer
As previously reported in the Original Form 8-K, the Company's board of
directors (the "Board") appointed Mr. Nolan as the Company's Chief Executive
Officer, effective on December 16, 2022.
On December 30, 2022, the Company entered into the Nolan Employment Agreement
with Mr. Nolan, governing the terms of his service as the Company's Chief
Executive Officer. Under the terms of the Nolan Employment Agreement, Mr. Nolan
will receive an initial annual base salary of $600,000 and will be eligible to
receive an annual performance bonus with a target of 60% of Mr. Nolan's base
salary. Any actual annual performance bonus amount will be based upon the
Board's good faith assessment of Mr. Nolan's and the Company's attainment of
goals established by the Board in its reasonable discretion. In accordance with
the Nolan Employment Agreement, Mr. Nolan was granted an option to purchase
1,106,131 shares of common stock with an exercise price equal to the closing
price of the Company's common stock on December 30, 2022 under the Company's
2020 Stock Incentive Plan (the "Plan"). 25% of the shares subject to the option
vest on December 16, 2023 and the remaining shares vest in 36 equal monthly
installments thereafter, subject to Mr. Nolan's continued service. Mr. Nolan
also entered into a confidentiality, inventions assignment, non-competition and
non-solicitation agreement with the Company.
Pursuant to the terms of the Nolan Employment Agreement, Mr. Nolan's employment
is at will and may be terminated at any time by the Company or Mr. Nolan.
If the Company terminates Mr. Nolan's employment without "Cause," or if
Mr. Nolan terminates his employment for "Good Reason" (each, as defined in the
Nolan Employment Agreement), he will be entitled to continued payment of his
base salary for twelve (12) months and payment or reimbursement of COBRA
premiums for twelve (12) months or, if earlier, the date when he becomes
eligible for substantially equivalent health insurance coverage in connection
with new employment. Such severance benefits are conditioned upon Mr. Nolan's
execution of and compliance with an effective and irrevocable general release,
compliance with certain non-competition and non-solicitation obligations,
resignation from all positions with us and return of all our property. The Nolan
Employment Agreement further provides that Mr. Nolan is entitled to severance
benefits described in "-Potential Payments Upon Termination or Change in
Control" below.
The foregoing description of the Nolan Employment Agreement is not complete and
is qualified in its entirety by reference to the Nolan Employment Agreement,
which will be filed as an exhibit to the Company's Annual Report on Form 10-K
for the year ended December 31, 2022.
Employment Agreement with Sukumar Nagendran, M.D., President and Head of
Research and Development
As previously reported in the Original Form 8-K, the Board appointed Dr. Sukumar
Nagendran as the Company's President and Head of Research and Development,
effective December 16, 2022.
--------------------------------------------------------------------------------
On December 30, 2022, the Company entered into the Nagendran Employment
Agreement with Dr. Nagendran governing the terms of his service as the Company's
President and Head of Research and Development. Under the terms of the Nagendran
Employment Agreement, Dr. Nagendran will receive an initial annual base salary
of $565,000 and will be eligible to receive an annual performance bonus with a
target of 50% of Dr. Nagendran's base salary. Any actual annual performance
bonus amount will be based on the Board's good faith assessment of
Dr. Nagendran's and the Company's attainment of goals established by the Board
in its reasonable discretion. In accordance with the Nagendran Employment
Agreement, Dr. Nagendran was granted an option to purchase 790,093 shares of
common stock with an exercise price equal to the closing price of the Company's
common stock on December 30, 2022 under the Plan. 25% of the shares subject to
the option vest on December 16, 2023 and the remaining shares vest in 36 equal
monthly installments thereafter, subject to Dr. Nagendran's continued service.
Dr. Nagendran also entered into a confidentiality, inventions assignment,
non-competition and non-solicitation agreement with the Company.
Pursuant to the terms of the Nagendran Employment Agreement, Dr. Nagendran's
employment is at will and may be terminated at any time by the Company or
Dr. Nagendran.
If the Company terminates Dr. Nagendran's employment without "Cause," or if
Dr. Nagendran terminates his employment for "Good Reason" (each, as defined in
the Nolan Employment Agreement), he will be entitled to continued payment of his
base salary for twelve (12) months and payment or reimbursement of COBRA
premiums for twelve (12) months or, if earlier, the date when he becomes
eligible for substantially equivalent health insurance coverage in connection
with new employment. Such severance benefits are conditioned upon
Dr. Nagendran's execution of and compliance with an effective and irrevocable
general release, compliance with certain non-competition and non-solicitation
obligations, resignation from all positions with us and return of all our
property. The Nagendran Employment Agreement further provides that Dr. Nagendran
is entitled to severance benefits described in "-Potential Payments Upon
Termination or Change in Control" below.
The foregoing description of the Nagendran Employment Agreement is not complete
and is qualified in its entirety by reference to the Nagendran Employment
Agreement, which will be filed as an exhibit to the Company's Annual Report on
Form 10-K for the year ended December 31, 2022.
Potential Payments Upon Termination or Change in Control.
Each of Mr. Nolan and Dr. Nagendran is eligible to receive severance benefits
under the terms of the Company's Change in Control Severance Plan adopted by the
Board in September 2020 (the "Change in Control Severance Plan").
The Change in Control Severance Plan provides for severance benefits upon a
"covered termination" that occurs during a "change in control period" (each as
described below). Upon a covered termination that occurs during a change in
control period, participants will be entitled to a lump sum payment equal to the
participant's base salary for a specified period (18 months for Mr. Nolan and 15
months for Dr. Nagendran), a lump sum payment equal to a multiple of the
participant's target annual bonus (150% for Mr. Nolan and 100% for
Dr. Nagendran), payment of continued group health benefits for a period of
months (18 months for Mr. Nolan and 15 months for Dr. Nagendran) and full
accelerated vesting of all outstanding equity awards (including
performance-based awards, which shall vest at 100% of target).
All severance benefits under the Change in Control Severance Plan are subject to
the participant's execution of an effective release of claims against the
company and compliance with the terms of any confidential information agreement,
proprietary information and inventions agreement and any other agreement between
the participant and the Company. For purposes of the Change in Control Severance
Plan, a "covered termination" is a termination of employment by the Company
without "cause," as defined in the Change in Control Severance Plan, or as a
result of the participant's resignation for "good reason," as defined in the
Change in Control Severance Plan, in either case, not as a result of death or
disability. For purposes of the Change in Control Severance Plan, a "change in
control period" is the period of time beginning three months prior to the date
on which a "change in control," as defined in the Plan, becomes effective and
ending on the first anniversary of the effective date of such change in control.
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses