Item
5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements
of Certain Officers.
On
January 19, 2017, Pure Bioscience, Inc. (the “Company”) entered into (i) an amendment (the “Chairman Amendment”)
to the Chairman Agreement (the “Chairman Agreement”), dated October 23, 2013, with Dave J. Pfanzelter, the Company’s
Executive Chairman and (ii) an amendment (the “Executive Amendment”, together with the Chairman Amendment, the “Amendments”)
to the Executive Employment Agreement (the “Executive Employment Agreement”, together with the Chairman Agreement,
the “Original Agreements”), dated October 23, 2013, with Henry R. Lambert, the Company’s Chief Executive
Officer. The Compensation Committee of the Company’s Board of Directors, after considering the benefits to the Company and
its stockholders of the continued association and services of Messrs. Pfanzelter and Lambert to the Company and the benefits of
retaining their respective experience, skills, abilities, background and knowledge to enable the Company to execute on its business
plan, approved the Amendments. Among other changes, the Amendments amended the double trigger severance benefits set forth in
the Original Agreements to provide for single trigger severance payments upon a change of control or termination without cause
or resignation for good reason. In the event of change in control or termination without cause or resignation for good reason,
(i) Mr. Pfanzelter will receive (A) a payment equal to $3,000,000, (B) a payment equal to 200% of his annual chairman compensation
then in effect and (C) the acceleration of then outstanding equity awards and (ii) Mr. Lambert will receive (A) a payment equal
to $1,000,000, (B) a payment equal to 200% of his annual base salary then in effect, (C) the acceleration of then outstanding
equity awards and (D) with respect to termination of employment, continuation of health benefits for six months. Additionally,
the Amendments amended the Original Agreements to provide each of Messrs. Pfanzelter and Lambert a tax gross-up payment in the
event that any payment or distribution made to Messrs. Pfanzelter or Lambert in connection with their separation from the Company
or upon a change of control of the Company becomes subject to an excise tax pursuant to Section 280G and Section 4999 of the Internal
Revenue Code.
The
Amendments also amended the definition of change in control to increase the ownership requirement from 35% to 40% of the voting
power of the Company before the acquisition of the Company’s common stock by any stockholder or group, as defined by Rule
13d-5 of the Exchange Act, will be deemed to be a change in control of the Company for purposes of the payments under Original
Agreements, as amended by the Amendments.
The
foregoing discussion of the Amendments is qualified in its entirety by reference to the full text of the Original
Agreements and the Amendments. Copies of the Chairman Agreement and the Executive Employment Agreement are attached as Exhibits
10.35 and 10.33 to the Company’s Annual Report on Form 10-K for the year ended July 31, 2013 and incorporated herein by
reference. Copies of the Chairman Amendment and Executive Amendment are attached to this Current Report on Form 8-K as Exhibits
99.1 and 99.2, respectively, and incorporated herein by reference.
Item
5.07 Submission of Matters to a Vote of Security Holders.
The
Company held its annual meeting of stockholders on January 19, 2017 (the “Annual Meeting”). Of the 64,823,917 shares
of the Company’s common stock outstanding as of the record date, 55,624,771 shares, or 85.6%, were represented at the Annual
Meeting either in person or by proxy.
In
accordance with the Company’s Bylaws, the presence of the holders of at least a majority of the outstanding shares of common
stock at the Annual Meeting, whether in person or by proxy, constituted a quorum for the transaction of business at the Annual
Meeting. Votes “For,” “Against,” “Abstentions” and “Broker Non-Votes” were each
counted as present at the Annual Meeting for purposes of determining the presence of a quorum. Broker Non-Votes are shares held
in street name by brokers, banks or other nominees who were present in person or represented by proxy at the Annual Meeting, but
which were not voted on a proposal because the brokers, banks or nominees did not have discretionary authority with respect to
that proposal and they had not received voting instructions from the beneficial owner prior to the Annual Meeting. Under the Company’s
Bylaws, the directors are elected by a plurality of the votes cast in person or by proxy at the Annual Meeting, which means that
the director nominees who received the highest number of “For” votes were elected. Approval of each of the other proposals
requires the affirmative vote of a majority of the votes cast in person or by proxy at the Annual Meeting. Abstentions and Broker
Non-Votes are not considered to be votes cast under the Company’s Bylaws, and as a result, have no effect on the outcome
of the vote.
A
description of each matter voted upon at the Annual Meeting is described in detail in the Company’s definitive proxy statement
filed with the Securities and Exchange Commission on December 8, 2016. The number of votes cast “For” and “Withheld”
and “Against” and the number of “Abstentions” and “Broker Non-Votes” with respect to each
matter voted upon are set forth below.
(1)
Election of Directors. The Company’s stockholders elected each of Dave J. Pfanzelter, Henry R. Lambert, Gary D. Cohee, David
Theno, Jr., PhD, William Otis and Tom Y. Lee, CPA, with the approval of 99.5%, 99.6%, 98.1%, 99.9%, 99.6% and 99.7%, of the votes
cast, respectively, to hold office until the 2018 Annual Meeting of Stockholders and until their respective successors are elected
and qualified. The following table shows the tabulation of the votes cast For and Against the election of each of the director
nominees as well as the Abstentions and Broker Non-Votes submitted for each director nominee:
Director
|
|
For
|
|
|
Withheld
|
|
|
Broker Non-Votes
|
|
Dave J. Pfanzelter
|
|
37,039,006
|
|
|
200,621
|
|
|
18,385,144
|
|
Henry R. Lambert
|
|
37,086,510
|
|
|
153,117
|
|
|
18,385,144
|
|
Gary D. Cohee
|
|
36,514,960
|
|
|
724,667
|
|
|
18,385,144
|
|
David Theno, Jr., PhD
|
|
37,184,425
|
|
|
55,202
|
|
|
18,385,144
|
|
William Otis
|
|
37,102,760
|
|
|
136,867
|
|
|
18,385,144
|
|
Tom Y. Lee, CPA
|
|
37,124,717
|
|
|
114,910
|
|
|
18,385,144
|
|
(2)
Ratification of Auditors. The Company’s stockholders ratified the appointment of Mayer Hoffman McCann P.C., with the approval
of 99.7% of the votes cast, as the Company’s independent registered public accounting firm for the fiscal year ending July
31, 2017. The following table shows the tabulation of the votes cast For and Against this proposal as well as the Abstentions
submitted on this proposal:
For
|
|
Against
|
|
|
Abstentions
|
|
55,473,479
|
|
136,572
|
|
|
14,720
|
|
(3)
Executive Compensation. The Company’s stockholders, on a non-binding, advisory basis, approved the compensation of the Company’s
named executive officers, with the approval of 96.8% of the votes cast, as disclosed in the proxy statement. The following table
shows the tabulation of the votes cast For and Against this proposal as well as the Abstentions and Broker-Non Votes submitted
on this proposal:
For
|
|
Against
|
|
|
Abstentions
|
|
|
Broker Non-Votes
|
|
36,030,872
|
|
665,513
|
|
|
543,242
|
|
|
18,385,144
|
|
No
other items were presented for stockholder approval at the Annual Meeting.