Item 5.02. Departure of Directors or Certain
Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment
of Gregory F. Covino as Chief Financial Officer
On November 9,
2020, the Company announced the appointment of Gregory F. Covino, age 55, as Executive Vice President and Chief Financial Officer
of the Company, effective November 16, 2020. Prior to joining the Company, Mr. Covino was Group CFO at GlaxoSmithKline’s
TESARO Oncology Division, where he also served as Senior Vice President and Chief Accounting Officer since July 2018. He previously
served as Chief Accounting Officer at Biogen Inc. since April 2012. He held earlier positions as Vice President, Corporate Internal
Audit and Vice President, International Finance for Boston Scientific Corporation. Earlier in his career, Mr. Covino spent 10 years
at international accounting and consulting firm PricewaterhouseCoopers.
Mr. Covino’s
employment as an Executive Vice President and the Chief Financial Officer of the Company will be on an at-will basis pursuant to
an offer letter (the “Offer Letter”) and an employment agreement (the Employment Agreement”) approved by the
Company’s Board of Directors (the “Board”), pursuant to which Mr. Covino is entitled to an annual base salary
of $440,000. Under the Company’s incentive bonus program, Mr. Covino is eligible to receive an annual target performance
bonus of 40% of his base salary, or any other percentage determined by the Board, based upon achievement by Mr. Covino and the
Company of certain specified goals determined by the Chief Executive Officer and the Board. The bonus may be paid out partly in
cash and partly in shares of stock options or restricted stock at the discretion of the Board.
Additionally,
pursuant to the Company’s Amended and Restated 2015 Stock Incentive Plan, as amended, Mr. Covino will be granted an initial
stock option award of 8,200 shares of Company common stock and an initial award of 7,300 restricted stock units.
The Employment
Agreement includes confidentiality provisions. Mr. Covino also agreed to non-competition and non-solicitation provisions lasting
for a period of 12 months following termination of his employment. Furthermore, if Mr. Covino is terminated by the Company without
cause or if Mr. Covino terminates his employment with the Company for good reason, he is entitled to a lump sum payment equal to
12 months of his then-effective salary, subject to his execution of a separation and release agreement. Additionally, Mr. Covino
is entitled to participate in the Company’s Change in Control Severance Benefit Plan adopted in 2005, as amended.
Mr. Covino and
the Company will enter into an indemnification agreement in substantially similar form as Exhibit 10.19 to the Company’s
Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 16, 2010.
There is no arrangement
or understanding between Mr. Covino and any other person pursuant to which Mr. Covino was appointed as an officer of the Company.
There are no family relationships between Mr. Covino and any director or officer of the Company. Mr. Covino has no material direct
or indirect interest in a related party transaction that requires disclosure.
The foregoing
description of the material terms of Mr. Covino’s Offer Letter and Employment Agreement does not purport to be complete and
is qualified in its entirety by reference to the Offer Letter and Employment Agreement, which will be filed with the Securities
and Exchange Commission as exhibits to the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.
Transition
of John J. Trizzino to Chief Commercial Officer
On November 7,
2020, upon Mr. Covino’s acceptance of the Offer Letter and Employment Agreement, the Company determined that Executive Vice
President John J. Trizzino would transition from his role of Chief Financial Officer and take on the newly created role of Chief
Commercial Officer, in addition to continuing his role as Chief Business Officer, effective November 16, 2020. Mr. Trizzino will
continue to be compensated in accordance with the terms of his employment agreement with the Company, dated February 26, 2014,
which is filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 5, 2016, and as disclosed
in the Company’s Definitive Proxy Statement on Schedule 14A filed with the SEC on May 13, 2020.
A press release announcing regarding the appointment of Mr.
Covino as Chief Financial Officer and announcement of other leadership updates of the Company, including Mr. Trizzino’s transition
to Executive Vice President, Chief Business Officer and Chief Commercial Officer is filed as Exhibit 99.2 hereto.