Item 5.02 Departure of Directors or Principal Officers;
Election of Directors; Appointment of Principal Officers; Compensatory Arrangements of Certain Officers.
On
July 27, 2017, the Company issued a press release (the Organizational Press Release) announcing updates to its organizational structure, including changes in management roles and responsibilities. A copy of the Organizational Press
Release is furnished as Exhibit 99.2 to this Current Report. The updated organizational structure includes the changes disclosed under this Item 5.02.
Jason Hannon, the Companys President and Chief Operating Officer, is stepping down from his position effective
August 1, 2017. Mr. Hannon indicated that he is stepping down to pursue other interests. Mr. Hannon will remain employed by the Company through September 1, 2017, and will thereafter serve as a consultant to the Company in an
advisory capacity through December 31, 2017. The Company entered into a letter agreement with Mr. Hannon, dated July 27, 2017, which provides that Mr. Hannon shall receive remuneration as a consultant at his current base salary
rate and, subject to his continued service to the Company in good standing through December 31, 2017, will remain eligible to receive an annual performance bonus for the year ended December 31, 2017
pro-rated
for the period January 1, 2017 September 1, 2017. The foregoing information is a summary of select terms from the letter agreement, is not complete, and is qualified in its entirety
by reference to the full text of such agreement, a copy of which is attached as an Exhibit 99.3 to this Current Report.
Quentin Blackford, the Companys Chief Financial Officer, tendered his resignation effective August 25, 2017.
Mr. Blackford indicated that he is pursuing another opportunity outside the spine industry and has agreed to remain with the Company during this transition period. Mr. Blackfords resignation is not the result of any dispute or
disagreement with the Company, including any matters relating to the Companys accounting practices or financial reporting. The Company intends to commence a search for a successor to Mr. Blackford.
Matthew Link, the Companys President, U.S. Commercial, has been appointed to the role of Executive Vice President,
Strategy, Technology and Corporate Development, effective August 1, 2017. In this newly created position, Mr. Link will lead product and systems development, global marketing, surgeon education, clinical research, and corporate
development.
Mr. Link, age 42, has served as the Companys President, U.S. Commercial, since July 2015.
Mr. Link previously served as the Companys President, U.S. Sales and Service, from January 2015 to July 2015, Executive Vice President of U.S. Sales, from January 2013 to January 2015, and Senior Vice President of Sales for the U.S.
Eastern region, from January 2012 to December 2012. Mr. Link joined the Company in 2006 and has more than 15 years of experience in the healthcare industry, including prior service in several regional sales positions with DePuy Orthopedics and
DePuy Spine. Mr. Link received a BSEd in Physical Education and Sports Medicine from the University of Virginia.
Upon his appointment as Executive Vice President, Strategy, Technology and Corporate Development, Mr. Links base
salary will increase to $500,000 per year effective August 1, 2017, and he will be eligible to receive an annual bonus payment at a target level of $450,000. Mr. Link will also receive a
one-time
long-term incentive (LTI) award in the form of performance restricted stock units (PRSUs), to be granted on August 1, 2017 with a grant date value of $500,000. The PRSUs will be payable in shares of Company common stock
at
0-150%
of target, based on revenue achievement for the performance period July 1, 2017 December 31, 2017. The shares subject to the PRSUs will cliff vest on August 1, 2020, subject to
Mr. Links continued service with the Company and compliance with the terms of the grant agreement. Mr. Link will continue to be eligible for grants of LTI awards and other Company benefits.
Stephen Rozow, the Companys Vice President, Global Operations, has been appointed to the role of Executive Vice
President, Global Process Transformation, effective August 1, 2017. In this expanded role, Mr. Rozow will have oversight of the Companys information technology, regulatory affairs, and quality assurance teams, in addition to his
current manufacturing and supply chain responsibilities.
Mr. Rozow, age 48, has served as the Companys Vice President, Global
Operations, since April 2015. Prior to joining the Company, from November 2012 to April 2015, Mr. Rozow was with Rauland-Borg, most recently serving as EVP and Chief Operating Officer. Prior to joining Rauland-Borg, Mr. Rozow spent over 20
years with Zimmer, Inc., including senior roles in global manufacturing and operations. Mr. Rozow earned his B.S. in Mechanical Engineering from Purdue University and an M.B.A from the University of Notre Dame.
Upon his appointment as Executive Vice President, Global Process Transformation, Mr. Rozows base salary will
increase to $395,000 per year effective August 1, 2017, and he will be eligible to receive an annual bonus payment at a target level of $296,250. Mr. Rozow will continue to be eligible for grants of LTI awards and other Company benefits.
Additional changes to management roles and responsibilities are disclosed in Item 8.01 of this Current Report.