We may terminate Dr. Smiths employment agreement without cause and Dr. Smith
may resign without notice. We may immediately terminate Dr. Smiths employment agreement for Cause (as defined in his agreement). Upon the termination of Dr. Smiths employment for any reason, Dr. Smith will continue to
receive payment of any base salary earned but unpaid through the date of termination and any other payment or benefit to which he is entitled under the applicable terms of any applicable company arrangements. If Dr. Smith is terminated during
the term of the employment agreement other than for Cause (as defined in the employment agreement) Dr. Smith is entitled to a lump sum severance payment equal to one times the amount of his annual base salary. In the event that such termination
is within six months following a Change of Control (as defined in the employment agreement), the lump sum paid to Dr. Smith will equal to one times the amount of his then current annual base salary.
In the event that Dr. Smiths employment with the Company is terminated by the Company or its successor without Cause within six
(6) months following the occurrence of a Change of Control (as defined in the employment agreement), Dr. Smith will be entitled to receive a one-time severance payment equal to a one-time cash severance payment equal to his then
current annual base salary. In addition, all unvested time-based options, RSUs or other equity securities to acquire shares of Company common stock shall immediately become fully vested and shall be exercisable to the extent provided for in the
Plan.
Dr. Smiths employment agreement also includes
2-year
non-competition
and
non-solicitation
and confidentiality covenants. Under the terms of this agreement, he is also entitled to the following benefits: medical, dental, life,
disability and 401(k).
James Vollins, General Counsel, Chief Compliance Officer and Corporate Secretary-
Mr. Vollins
employment agreement, dated November 5, 2018 includes a base salary of $310,000, target bonus of up to 40% of his base salary (which is subject to modification by our Compensation Committee), and other employee benefits. Under the terms of his
agreement, Mr. Vollins also received in 2018 a
sign-on
bonus of $35,000.
We may terminate
Mr. Vollins employment agreement without cause and Mr. Vollins may resign without notice. We may immediately terminate Mr. Vollins employment agreement for Cause (as defined in his agreement). Upon the termination of
Mr. Vollins employment for any reason, Mr. Vollins will continue to receive payment of any base salary earned but unpaid through the date of termination and any other payment or benefit to which he is entitled under the applicable
terms of any applicable company arrangements. If Mr. Vollins is terminated during the term of the employment agreement other than for Cause (as defined in the employment agreement) Mr. Vollins is entitled to a lump sum severance payment
equal to one times the amount of his annual base salary. In the event that such termination is within six months following a Change of Control (as defined in the employment agreement), the lump sum paid to Mr. Vollins will equal to one times
the amount of his then current annual base salary.
In the event that Mr. Vollins employment with the Company is terminated by the
Company or its successor without Cause within six (6) months following the occurrence of a Change of Control (as defined in the employment agreement), Mr. Vollins will be entitled to receive a one-time severance payment equal to a
one-time cash severance payment equal to his then current annual base salary. In addition, all unvested time-based options, RSUs or other equity securities to acquire shares of Company common stock shall immediately become fully vested and shall be
exercisable to the extent provided for in the Plan.
Mr. Vollins employment agreement also includes
2-year
non-competition
and
non-solicitation
and confidentiality covenants. Under the terms of this agreement, he is also entitled to
the following benefits: medical, dental, life, disability and 401(k).
Ernest R. De Paolantonio, CPA, MBA, Chief Financial Officer,
Secretary and Treasurer
Mr. De Paolantonios prior employment agreement, dated October 1, 2013, included a base salary of $300,000, target bonus of up to 40% of his base salary (which was subject to modification by our
Compensation Committee), and other employee benefits. Under the terms of his agreement in 2018, Mr. De Paolantonio received a base salary of $370,000 and a bonus of $98,000, which bonus was related to 2017 performance.
On January 23, 2019, the Company entered into a transitional service and separation agreement with Mr. De Paolantonio. Unless
Mr. De Paolantonio resigns or his employment is terminated earlier, Mr. De Paolantonio will continue as a senior advisor to us until April 30, 2019, at which time his employment with us will end. (See Compensation Discussion and
Analysis for details on Mr. De Paolantonios separation agreement.)
Mr. De Paolantonios transitional service and
separation agreement also includes
2-year
non-competition
and
non-solicitation
and confidentiality covenants on terms identical
to the prior employment agreement. Under the terms of this agreement, he was also entitled to the following benefits: medical, dental, life, disability and 401(k).
Amended and Restated 2001 Incentive Plan
In July 2011, our original Amended and Restated 2001 Incentive Plan expired. Options to purchase 578,645 shares of common stock were
outstanding and exercisable as of December 31, 2018 under the Amended and Restated 2001 Incentive Plan. In April 2011, our board approved, and in July 2011, our stockholders approved a new 2011 Equity Incentive Plan, which is discussed below.
2011 Equity Incentive Plan
Our 2011 Equity Incentive Plan was originally comprised of 4,200,000 shares of our common stock. The purpose of the 2011 Equity Incentive Plan
is: (i) to align our interests and recipients of options under the plan by increasing the proprietary interest of such recipients in our growth and success, and (ii) to advance our interests by providing additional incentives to officers,
key employees and well-qualified
non-employee
directors and consultants who provide services to us, who are responsible for our management and growth, or otherwise contribute to the conduct and direction of
our business, operations and affairs. The Compensation Committee of our board of directors administers our incentive plan, selects the persons to whom options are granted and fixes the terms of such options. In July 2013, 2014, 2015 and in December
2017, our stockholders approved increases to our 2011 Equity Incentive Plan in the amounts of 2,600,000, 2,000,000, 2,250,000 and 7,100,000, respectively.
Options may be awarded during the
ten-year
term of the plan to our employees, directors, or
consultants who are not employees and our other affiliates. Our plan provides for the grant of options that qualify as incentive stock options, or Incentive Stock Options, under Section 422 of the Internal Revenue Code of 1986, as amended, and
options which are not Incentive Stock Options, or
Non-Statutory
Stock Options, as well as restricted stock and other awards. Only our employees may be granted Incentive Stock Options. Our affiliates or
consultants or others as may be permitted by our board of directors, may be granted
Non-Statutory
Stock Options.
Options to purchase 4,406,004 shares of our common stock at prices ranging from $1.78 to $16.47 are outstanding at December 31, 2018.
Options issued during 2018 to directors and employees under the 2011 Equity Incentive Plan totaled 2,549,177 shares, at exercise prices
ranging from $2.07 to $3.72.
Outstanding equity awards
The following table summarizes outstanding unexercised options, unvested stock and equity incentive plan awards held by each of our name
executive officers, as of December 31, 2018.
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