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Item 5.02
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Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
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On June 27, 2017,
the Compensation Committee of the Board of Directors (the “Board”) of IsoRay, Inc. (the “Company”) decided
to increase the salaries of the following persons as follows:
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Thomas C. LaVoy, the Company’s Chief Executive Officer and Chairman’s, salary was increased
to $315,612.15 annually;
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William Cavanagh, the Company’s Chief Operating Officer’s, salary was increased to
$211,785 annually;
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Michael Krachon, the Company’s Vice President of Sales & Marketing’s, salary was
increased to $236,250 annually; and
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Jennifer Streeter, the Company’s Vice President of Human Resources’ (made a
named
executive
officer effective June 15, 2017),
salary was
increased to $126,000 annually.
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Each of the foregoing
salary increases is effective as of July 1, 2017, and is an increase of 5% over the person’s prior annual salary, in line
with increases being given to most other Company employees.
On June 27,
2017, the Compensation Committee ratified the bonus plan previously adopted by the Board for fiscal year 2017 for fiscal year
2018, such that each named officer has an opportunity to earn (a) a bonus of four percent (4%) of his or her annual base
salary for a twenty percent (20%) or greater increase in revenue from the prior fiscal year’s comparable quarter, and
(b) a bonus of four percent (4%) of his or her annual base salary for a twenty percent (20%) or greater increase in revenue
over the prior fiscal year.
On June 27, 2017,
the Company granted options, pursuant the
Company’s 2017 Equity Incentive Plan (the “2017
Plan”),
to purchase shares of the Company’s common stock (“Shares”) to the following persons:
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An option to purchase 715,000 Shares was granted to Mr. LaVoy;
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An option to purchase 225,000 Shares was granted to Mr. Cavanagh;
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An option to purchase 225,000 Shares was granted to Mr. Krachon; and
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An option to purchase 100,000 Shares was granted to Ms. Streeter.
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Each of the foregoing
options is at an exercise price of $0.605 per share, which was equal to the closing price of the Company’s common stock on
June 27, 2017. 25% of each of the foregoing options vests and becomes exercisable immediately, and the remaining 75% vests over
the next three years, commencing on June 27, 2018, until fully vested, and expires on June 26, 2027.
Additionally, on
June 27, 2017, the Company granted options, pursuant the
2017 Plan,
to purchase 5,000 Shares
to each of Philip J. Vitale, M.D., Michael W. McCormick, and Alan Hoffmann, each of whom is a director of the Company.
Each of the foregoing
options is at an exercise price of $0.605 per share, which was equal to the closing price of the Company’s common stock on
June 27, 2017. 25% of each of the foregoing options vests and becomes exercisable immediately, and the remaining 75% vests over
the next three years, commencing on June 27, 2018, until fully vested, and expires on June 26, 2027.
Each foregoing grantee
of options under the 2017 Plan and the Company entered into a Stock Option Agreement and Notice of Grant of Stock Option with respect
to the grantees’ options. The foregoing description of the Stock Option Agreement and Notice of Grant of Stock Option is
not a complete description and is qualified in its entirety by reference to the form of Stock Option Agreement and Notice of Grant
of Stock Option, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Additionally, Matthew
P. Branson,
Controller, Principal Financial and Accounting Officer of the Company,
left the Company
as planned on June 30, 2017
. The terms of Mr. Branson’s Separation Agreement were disclosed on
the Form 8-K filed by the Company on June 23, 2017. Options previously granted to Mr. Branson to purchase 45,000 Shares were terminated
on June 15, 2017, as part of the termination of all options issued under the Company’s 2014 Stock Option Plan.