Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
Resignation of Maximilian de Clara
Effective August 31, 2016 Maximilian de Clara resigned as an officer and
director of the Company. Mr. de Clara's resignation was not due to any
disagreements with the Company.
In consideration for Mr. de Clara's past services to the Company, the
Company entered into a Termination Agreement with Mr. de Clara which provided
for the following:
1. The Company agreed to issue 650,000 restricted shares of its common
stock to Mr. de Clara. The first 325,000 shares will be issued
promptly after August 31, 2016. Of the first 325,000 shares, none of
the shares may be sold prior to February 28, 2017. Starting on
February 28, 2017, each month the Company will remove the restrictive
legend on 65,000 shares. The second 325,000 shares will be issued on
August 31, 2017, but may not be sold prior to February 28, 2018.
Starting on February 28, 2018, each month the Company will remove the
restrictive legend on 65,000 shares. The foregoing procedure will
continue until the restricted legend has been removed on all 650,000
shares.
2. All options held by Mr. de Clara will vest as of August 31, 2016.
3. Mr. de Clara's existing coverage under the Company's group health plan
will end on August 31, 2016. However, Mr. de Clara may be eligible to
elect temporary continuation coverage under the Company's group health
plan in accordance with the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended ("COBRA"). If Mr. de Clara elects COBRA
continuation coverage, the Company will pay for COBRA coverage (such
payments will not include COBRA coverage with respect to the Company's
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Section 125 health care reimbursement plan) until February 28, 2018,
or the maximum period permitted under COBRA if such period is less
than eighteen months. If Mr. de Clara exhausts the applicable COBRA
period prior to February 28, 2018, the Company will reimburse Mr. de
Clara for the cost of an individual health insurance policy in an
amount not to exceed the amount of the monthly COBRA premium
previously paid by the Company.
The Termination Agreement was approved by the Company's Compensation
Commmittee.
The foregoing description of the Termination Agreement is qualified in its
entirety by reference to the full text of the Termination Agreement attached as
an exhibit to this report.
Employment Agreements
On August 31, 2016, CEL-SCI entered into a three-year employment agreement
with Geert Kersten, CEL-SCI's Chief Executive Officer. The employment agreement
with Mr. Kersten, which is essentially the same as Mr. Kersten's prior
employment agreement, as amended on August 30, 2013, provided that, during the
term of the agreement, CEL-SCI would pay Mr. Kersten an annual salary of
$559,052, plus any increases in proportion to salary increases granted to other
senior executive officers of CEL-SCI, as well any increases approved by the
Board of Directors during the period of the employment agreement.
On August 31, 2016, CEL-SCI entered into a three-year employment agreement
with Patricia B. Prichep, CEL-SCI's Senior Vice President of Operations. The
employment agreement with Ms. Prichep, which is essentially the same as Ms.
Prichep's prior employment agreement entered into on August 30, 2013 provided
that, during the term of the agreement, CEL-SCI would pay Ms. Prichep an annual
salary of $245,804 plus any increases approved by the Board of Directors during
the period of the employment agreement.
On August 31, 2016, CEL-SCI entered into a three-year employment agreement
with Eyal Talor, Ph.D., CEL-SCI's Chief Scientific Officer. The employment
agreement with Dr. Talor, which is essentially the same as Dr. Talor's prior
employment agreement entered into on August 30, 2013, provided that, during the
term of the agreement, CEL-SCI would pay Dr. Talor an annual salary of $303,453
plus any increases approved by the Board of Directors during the period of the
employment agreement.
The employment agreements were approved by CEL-SCI's Compensation
Committee. In renewing the employment agreements with the persons mentioned
above, CEL-SCI's Compensation Committee considered various factors, including
each employee's performance in their area of responsibility, each employee's
experience in his or her position, and each employee's length of service with
CEL-SCI.
The foregoing description of the Employment Agreements are qualified in
their entirety by reference to the full text of the Employment Agreements
attached as exhibits to this report.
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