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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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Resignation of William Brown as Chief Financial
Officer
On December 9, 2021,
William Brown, the Chief Financial Officer, principal accounting officer and principal financial officer of Altimmune, Inc. (the “Company”), submitted notice to the Company’s Board of Directors (the
“Board”) of his resignation, effective as of December 31, 2021. Mr. Brown is leaving the Company in order to pursue
other opportunities and his decision to resign was not the result of any disagreement with the Company.
Appointment of Richard I. Eisenstadt as Chief
Financial Officer
On December 13, 2021, the
Company issued a press release announcing the decision of the Board to appoint Mr. Richard I. Eisenstadt as the Company’s Chief
Financial Officer (“CFO”), effective December 31, 2021. Mr. Eisenstadt will serve as the Company’s principal accounting
officer and principal financial officer.
Prior to joining the Company,
Mr. Eisenstadt, 63, served as Chief Financial Officer, Secretary and Treasurer of Aytu BioPharma,
Inc. (NASDAQ: AYTU) since March 2021, when Aytu BioPharma, Inc. completed a merger with Neos Therapeutics, Inc., where Mr. Eisenstadt
served as Chief Financial Officer from May 2014 until the merger in March 2021. Prior to that,
Mr. Eisenstadt served as Chief Financial Officer of ArborGen Inc. from January 2013 to May 2014, and as Vice President of Finance and
Chief Financial Officer of Tranzyme, Inc., now part of Mallinckrodt plc (NYSE: MNK) from June 2003 to December 2012. He previously
held financial leadership positions at Cogent Neuroscience, Inc. and Nimbus CD International, Inc. Mr. Eisenstadt received his M.B.A.
from James Madison University and his B.A. in Economics from the University of North Carolina, Chapel Hill.
In connection with Mr.
Eisenstadt’s appointment as Chief Financial Officer, the Company and Mr. Eisenstadt entered into a new employment agreement,
dated December 10, 2021 (the “Employment Agreement”). Pursuant to the terms of the Employment Agreement, Mr. Eisenstadt
will receive an annual salary of $425,000 and be eligible for an annual bonus, with a target bonus of 40% of his base salary, based
on achievement of performance goals established by the compensation committee of the Board. Mr. Eisenstadt will also receive
a signing bonus of $120,000, which will be subject to repayment by Mr. Eisenstadt in
the event Mr. Eisenstadt’s employment is terminated by the Company with
“Cause” or by reason of Mr. Eisenstadt’s resignation without “Good Reason” (each as defined in the
Employment Agreement) on or prior to December 31, 2022. Mr. Eisenstadt will receive an equity grant to purchase 150,000
shares of the Company’s common stock, at an exercise price equal to the fair market value of such shares on the date of grant
(the “Option Grant”). Twenty-five percent of the Option Grant will vest and become exercisable on December 31, 2022, and
the balance of the Option Grant will vest ratably over thirty-six months thereafter, subject to Mr. Eisenstadt’s continued
employment. Mr. Eisenstadt will also receive an equity grant of 50,000 restricted stock units (the “RSU Grant”).
Twenty-five percent of the RSU Grant will vest and become exercisable on December 31, 2022, and the balance of the RSU Grant will
vest in equal annual installments for the following three years, subject to Mr. Eisenstadt’s continued employment. Mr. Eisenstadt
is also eligible to participate in the Company’s employee benefit plans available to its employees, including its stock option
plan, subject to the terms of those plans.
In the event that Mr. Eisenstadt
is terminated by the Company without Cause or resigns for Good Reason, Mr. Eisenstadt will be entitled to, subject to his execution of
and compliance with a release agreement, (i) cash severance payments in an amount equal to twelve months of Mr. Eisenstadt’s salary
existing at the time of his termination, paid in twelve monthly installments and (ii) continuation of COBRA coverage paid by the Company
through twelve months following the date of termination.
In the event that Mr. Eisenstadt
is terminated without Cause or resigns for Good Reason within twelve months following a “Change in Control” (as defined in
the Employment Agreement), Mr. Eisenstadt will be entitled to, subject to his execution of and compliance with a release agreement, (i)
cash severance payments equal to the sum of (x) twelve months of Mr. Eisenstadt’s Base Salary (existing at the time of such termination)
plus (y) Mr. Eisenstadt’s target Annual Bonus for the year of termination, payable over the twelve month period following such termination;
(ii) continuation of COBRA coverage paid by the Company through twelve months following the date of termination and (iii) the acceleration
of vesting of all unvested equity awards held by him immediately prior to such termination.
There
are no family relationships between Mr. Eisenstadt and any director or executive officer of the Company, and the Company has not entered into any transactions with Mr. Eisenstadt that are reportable pursuant to Item 404(a) of Regulation
S-K. Except as described above, there are no arrangements or understandings between Mr. Eisenstadt and any other persons pursuant to which
he was appointed as Chief Financial Officer.
The foregoing description
of the Employment Agreement is a summary only and is qualified in its entirety by reference to the full text of the Employment Agreement,
which is filed herewith as Exhibit 10.1 and incorporated by reference herein in its entirety.
The Company will enter into an indemnification agreement with Mr. Eisenstadt in connection with his employment, which will be in substantially
the same form as that entered into with the other executive officers of the Company filed as Exhibit 10.24 to the Company's annual report
on Form 10-K and incorporated herein by reference.