Item 5.02. Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On March 16, 2018, Dean Ferrigno, the Vice
President of Finance and Chief Accounting Officer of Sorrento Therapeutics, Inc. (the “Company”), notified the Company
of his intention to resign from his roles with the Company, effective March 23, 2018.
Effective March 19, 2018, the Company appointed
Jiong Shao, age 49, as the Company’s Executive Vice President and Chief Financial Officer. Upon commencement of his appointment,
Mr. Shao assumed the duties of the Company’s principal financial officer and principal accounting officer until such time
as his successor is appointed, or until his earlier resignation or removal. There are no reportable family relationships or related
party transactions (as defined in Item 404(a) of Regulation S-K) involving the Company and Mr. Shao.
Prior to joining the Company, Jiong Shao
was Managing Director, Head of U.S. Office, at CEC Capital, a financial advisory and investment firm. From 2015 to May 2017, Mr.
Shao served as Managing Director, Head of China TMT Investment Banking at Deutsche Bank in Hong Kong. Prior to that time, from
2010 through 2015, he held various Managing Director positions at Macquarie Capital. From 2008 to 2010, Mr. Shao served as Executive
Director, Asia Regional Head of Industrials Research, followed by Executive Director, Head of China-based Equity Research at Nomura
International. He holds a Bachelor of Engineering from Shanghai Jiaotong University and a Masters of Business Administration from
Fuqua School of Business, Duke University. Mr. Shao is a Chartered Financial Analyst.
On March 16, 2018, the Company entered
into an offer letter with Mr. Shao (the “Offer Letter”). Pursuant to the Offer Letter, Mr. Shao’s annualized
salary is $450,000 and he will be eligible to receive an annual performance bonus of up to 35% of his base salary commencing for
fiscal year 2018. Mr. Shao’s employment will be on an “at will” basis. Additionally, the Company granted Mr.
Shao an option to purchase 200,000 shares of the Company’s common stock (the “Option”) under the Company’s
Amended and Restated 2009 Stock Incentive Plan, as amended (the “Plan”). The Option will vest, subject to Mr. Shao’s
continued employment with the Company, over a four year period, with 25% of the shares subject to the Option vesting on the first
anniversary of the grant date and 1/48th of the shares subject to the Option vesting each month thereafter. The Company granted
Mr. Shao a second option to purchase 300,000 shares of the Company’s common stock (the “Milestone Option”) under
the Plan. The Milestone Option will vest, subject to Mr. Shao’s continued employment with the Company, upon the date the
Company’s common stock becomes listed on The Stock Exchange of Hong Kong Limited. The Company also entered into an indemnification
agreement with Mr. Shao in the same form as its standard form of indemnity agreement with the Company’s other executive officers.
The foregoing description of the Offer
Letter does not purport to be complete and is qualified in its entirety by reference to the full text of the Offer Letter, which
will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2018 and is incorporated
herein by reference.
On March 19, 2018, the Company issued a
press release announcing the appointment of Mr. Shao as the Company’s Executive Vice President and Chief Financial Officer.
A copy of the press release is attached as Exhibit 99.1 and incorporated herein by reference.