Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On July 9, 2020, Akcea Therapeutics, Inc. (the "Company") announced the
appointment of William T. Andrews, M.D., FACP as Chief Medical Officer of the
Company.
Dr. Andrews, age 56, joined the Company on July 9, 2020 as Chief Medical
Officer. Prior to joining the Company, from October 2017 to July 2020,
Dr. Andrews served as Chief Medical Officer of Acer Therapeutics Inc. Prior to
joining Acer, Dr. Andrews provided strategic consulting services to rare disease
companies from April 2016 to September 2017. Prior to that, he served at
Aegerion Pharmaceuticals, Inc., a biopharmaceutical company, as Senior Vice
President, Business Development, from May 2014 to January 2016, and as Vice
President of Medical Affairs, from April 2012 to May 2014. He has also held
roles at Santhera Pharmaceuticals, Sepracor, Inc. and ClinQuest, Inc. Prior to
joining the biopharmaceutical industry 20 years ago, Dr. Andrews practiced
medicine for seven years full-time and 11 years part-time in the Boston area as
a board-certified internist and an attending physician at Brigham and Women's
Hospital, and was on the clinical faculty at Harvard Medical School. Dr. Andrews
earned a B.A. in biology from Harvard University and an M.D. from Yale
University School of Medicine.
In connection with Dr. Andrews' appointment as the Company's Chief Medical
Officer, the Company entered into a written offer letter dated June 18, 2020
(the "Offer Letter") with Dr. Andrews. Pursuant to the Offer Letter, Dr. Andrews
is entitled to receive:
• An annual base salary of $460,000, and is eligible to receive an annual
performance bonus, with a target bonus amount equal to 50% of his base
salary under the Company's Management by Objectives program;
• A stock option exercisable for up to 250,000 shares of the Company's
common stock, vesting over a four-year period, under the Company's 2015
Equity Incentive Plan;
• A restricted stock unit award for 37,500 shares of the Company's common
stock, vesting over a four-year period, under the Company's 2015 Equity
Incentive Plan;
• A one-time signing bonus of $25,000, subject to repayment by Dr. Andrews
in full to the extent he voluntarily leaves the Company within twelve
months of the commencement of his employment, and subject to 50%
repayment by Dr. Andrews if he voluntarily leaves the Company after
twelve months of the commencement of his employment but before the
24-month anniversary of the commencement of his employment; and
• Eligibility to participate in the Company's employee benefit plans,
subject to the terms of those plans.
The foregoing description of the Offer Letter does not purport to be complete
and is qualified in its entirety by reference to the copy of such document filed
as Exhibit 10.1 to this Current Report on Form 8-K.
On July 9, 2020, the Company and Dr. Andrews also entered into a severance
benefit agreement (the "Severance Benefit Agreement"). Under the terms of the
Severance Benefit Agreement, Dr. Andrews will be eligible to receive medical
benefit continuation, and a lump sum severance payment equal to (i) 12 months of
his then-current base salary if his employment is terminated without cause or by
him for good reason, or (ii) if, as a result of a change in control (as defined
in the Severance Benefit Agreement) of the Company, his employment is terminated
without cause or by him for good reason, 18 months of his then-current base
salary plus an amount equal to his target annual cash performance bonus for the
year of termination multiplied by a fraction set forth in the Severance Benefit
Agreement. In addition, if, in connection with a change in control, an equity
award granted to Dr. Andrews is assumed or continued by the acquirer entity but
his employment is terminated without cause or by him for good reason, or an
equity award granted to Dr. Andrews is not assumed or continued by the acquirer
entity (or substituted for a similar award of the acquirer entity), then any
unvested portion of the equity award will become vested effective immediately
prior to the consummation of such change in control.
The Severance Benefit Agreement will remain in effect as long as Dr. Andrews
continues to be employed by the Company. As a condition to receiving payments
under the Severance Benefit Agreement, Dr. Andrews is required to return all of
the Company's property and sign an agreement releasing the Company from
liability. The foregoing description of the Severance Benefit Agreement does not
purport to be complete and is qualified in its entirety by the full text of such
document, which is filed as Exhibit 10.2 to this Current Report on Form 8-K.
Dr. Andrews will also be eligible to enter into the Company's standard form of
indemnification agreement.
There are no family relationships between Dr. Andrews and any director or
executive officer of the Company, and Dr. Andrews is not a party to any
transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
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The foregoing descriptions of the 2015 Equity Incentive Plan and form of
indemnification agreement do not purport to be complete and are qualified in
their entirety by the full text of the 2015 Equity Incentive Plan and form of
indemnification agreement, copies of which are filed as Exhibits 10.2 and 10.3,
respectively, to the Company's Current Report on Form 8-K filed September 5,
2017, both of which are incorporated by into this Item 5.02 by reference herein.
A copy of the Company's press release regarding Dr. Andrews' appointment to
Chief Medical Officer of the Company is attached hereto as Exhibit 99.1.
Item 1.01 Entry into a Material Definitive Agreement.
On June 17, 2020, Louis St. L. O'Dea, MB B.Ch. BAO, FRCP(C), former Chief
Medical Officer of the Company, notified the Company that he plans to retire and
therefore will resign his position as Chief Medical Officer of the Company.
Dr. O'Dea's resignation was effective July 7, 2020.
In connection with the conclusion of his employment with the Company, on July 7,
2020, Dr. O'Dea and the Company entered into a separation agreement (the
"Separation Agreement"). Under the Separation Agreement, Dr. O'Dea will receive
medical benefit continuation, a lump sum severance payment equal to 12 months of
his then-current base salary, and an amount equal to 50% of his 2020 annual
bonus based on the Company Performance Factor (CPF) approved by the Board of
Directors.
In addition, on July 7, 2020, the Company entered into a consulting agreement
(the "Consulting Agreement") with Dr. O'Dea under which he agreed to provide up
to 20 hours per week of consulting services to the Company to support ongoing
development and regulatory initiatives and to assist with the transition of his
responsibilities as former Chief Medical Officer to his successor, William T.
Andrews, M.D., FACP, through December 31, 2020 (the "Consulting Period"). In
consideration of such consulting services, the Company has agreed to pay
Dr. O'Dea an amount equal to $450.00 per hour and continue the vesting of any
equity awards outstanding as of his separation date through the end of the
Consulting Period.
The foregoing descriptions of the Separation Agreement and the Consulting
Agreement do not purport to be complete and are qualified in their entirety by
reference to copies of such documents filed as Exhibit 10.3 and Exhibit 10.4,
respectively, to this Current Report on Form 8-K.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
10.1 Offer Letter between William Andrews and the Company dated June 18, 2020
10.2 Severance Benefit Agreement between William Andrews and the Company
dated July 9, 2020
10.3 Separation Agreement between Louis St. L. O'Dea and the Company dated
July 7, 2020
10.4 Consulting Agreement between Louis St. L. O'Dea and the Company dated
July 7, 2020
99.1 Press Release dated July 9, 2020
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