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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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Executive Employment Agreement
s
On
February 27, 2018, Viveve Medical, Inc. (the “Company”), upon approval by the Company’s Board of Directors (the “Board”) under recommendation of the Compensation Committee (the “Compensation Committee”) of the Board, entered into new employment agreements (the “Agreements”) with each of Patricia Scheller, Scott Durbin and James Atkinson, the Company’s Chief Executive Officer, Chief Financial Officer and Chief Business Officer and President, respectively (each an “Executive” and, collectively, the “Executives”). The Agreements supersede and replace offer letters previously entered into between the Company and the Executives.
The Agreement
s provide for an annual base salary (the “Base Salary”), which is subject to annual review by the Board or the Compensation Committee. In addition, each Executive is eligible to receive an annual cash incentive bonus as determined by the Board or the Compensation Committee, with the target amount of such bonus equal to a percentage of the Executive’s Base Salary (the “Target Bonus”), and is also eligible to participate in the Company’s employee benefit plans in effect from time to time, subject to the terms of such plans.
The Agreements provide that in the event that an Executive
’s employment is terminated by the Company without Cause (as defined in the Agreements) or by the Executive for Good Reason (as defined in the Agreements), subject to the satisfaction of certain conditions, the Executive will be entitled to: (i) base salary continuation for the Severance Period (as defined below) plus any incentive compensation earned with respect to any completed calendar year but unpaid as of the date of termination, and (ii) acceleration of stock options and other stock-based awards held by the Executive that are subject to time-based vesting such that as of the date of termination, the Executive will be deemed vested in the same number of shares as would have been vested if the Executive had remained employed through the end of the Severance Period.
In lieu of the foregoing payments and benefits, in the event that an Executive
’s employment is terminated by the Company without Cause or by the Executive for Good Reason, in either case within 12 months following a Change in Control (as defined in the Agreements) subject to the satisfaction of certain conditions, the Executive will be entitled to: (i) a lump sum cash payment equal to the Cash Compensation Multiple (as defined below) times the sum of (A) the Executive’s then-current base salary (or base salary in effect prior to the Good Reason trigger, if applicable, or the Change in Control, if higher) and (B) the Executive’s Target Bonus for the then-current year, and (ii) except as otherwise provided in the applicable stock option or other-stock based award agreement, accelerated vesting of 100% of all stock options and other stock-based awards held by the Executive that are subject to time-based vesting
The
Base Salary for each Executive is as follows: Ms. Scheller, $414,250; Mr. Durbin, $346,100; and Mr. Atkinson, $353,500.The Target Bonus for each Executive is as follows: Ms. Scheller, 50%; Mr. Durbin, 40%; and Mr. Atkinson, 40%.
The
“Severance Period” for each of the Executives is as follows: Ms. Scheller, 12 months; Mr. Durbin, 10 months; and Mr. Atkinson, nine months.
The “Compensation Multiple” for each Executive is as follows: Ms
. Scheller, 1.5; Mr. Durbin, 1.0; and Mr. Atkinson, 1.0.
The foregoing descriptions of the terms of the Agreements do not purport to be complete and are qualified in their entirety by reference to each Agreement, which
are filed as exhibits 10.1, 10.2 and 10.3 to this Current Report on Form 8-K, and are incorporated herein by reference.