Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On January 2, 2020, NuVasive, Inc. (the "Company") issued a press release (the
"Press Release") announcing the appointment of Matthew K. Harbaugh as the
Company's Executive Vice President, Chief Financial Officer. In the Press
Release, the Company also announced that Rajesh J. Asarpota would be
transitioning from the Company. A copy of the Press Release is furnished as
Exhibit 99.1 to this Current Report on Form 8-K.
On December 27, 2019, the Board of Directors of the Company approved the hiring
and appointment of Mr. Harbaugh, effective as of January 1, 2020, as the
Company's Executive Vice President, Chief Financial Officer, and designated
Mr. Harbaugh as the Company's principal financial officer and principal
accounting officer for purposes of the rules and regulations of the Securities
and Exchange Commission.
Mr. Harbaugh, age 49, most recently served as an executive at Mallinckrodt plc,
a global specialty pharmaceutical products company. From May 2018 to September
2019, he served as the President of Mallinckrodt's Specialty Generics business,
and from July 2013 to December 2018, he served as Mallinckrodt's Executive Vice
President and Chief Financial Officer. Mr. Harbaugh previously held a variety of
financial management positions at Covidien Pharmaceuticals, which was spun-off
from Covidien plc as Mallinckrodt plc in July 2013. Mr. Harbaugh joined Covidien
in 2007 and served in several finance and leadership roles, including as Chief
Financial Officer and Interim President of Covidien Pharmaceuticals. Prior to
joining Covidien, Mr. Harbaugh was a Lead Finance Executive with Cerberus
Capital Management, L.P., a New York-based private equity firm, from April 2007
until August 2007. Prior to that Mr. Harbaugh worked nearly ten years for
Monsanto Company, where he held various roles in investor relations and finance.
Mr. Harbaugh earned a Bachelor of Science in Business Administration from St.
Louis University in St. Louis, MO and an Executive M.B.A from the Kellogg School
of Management at Northwestern University in Chicago, IL.
On December 27, 2019, the Company entered into a letter agreement with
Mr. Harbaugh with respect to his employment, compensation and benefits as
Executive Vice President, Chief Financial Officer. Mr. Harbaugh's initial base
salary is $525,000 annually, and he will be eligible to receive an annual bonus
payment for 2020 at a target level of $472,500 (90% of base salary).
Mr. Harbaugh received a one-time long-term incentive ("LTI") award, granted on
January 2, 2020, comprised of restricted stock units ("RSUs") with an aggregate
grant date value of $100,000 and subject to cliff vesting on January 1, 2023.
Mr. Harbaugh will also be eligible for an annual LTI award, to be granted in
connection with the Company's annual LTI award program for 2020, with a grant
date target value of $1,600,000. This award is expected to be comprised of RSUs,
performance stock units and performance cash awards, consistent with the annual
LTI awards for other Company executives, and subject to cliff vesting on the
third anniversary of the date of grant. Mr. Harbaugh will also be eligible for
other health, welfare, relocation and financial benefits provided to Company
executives, including participation in the Company's Amended and Restated
Executive Severance Plan.
The Company also entered into its standard form of Change in Control Agreement
with Mr. Harbaugh, as well as its standard form of Indemnification Agreement, on
January 1, 2020. In consideration for entering into the Change in Control
Agreement, Mr. Harbaugh also entered into a Proprietary Information, Inventions
Assignment and Restrictive Covenant Agreement, pursuant to which he agreed to
certain restrictive covenants for a period of two years following termination of
employment, including non-competition and non-solicitation restrictions.
There is no arrangement or understanding with any other person pursuant to which
Mr. Harbaugh was appointed as Executive Vice President, Chief Financial Officer,
and there are no family relationships between Mr. Harbaugh and any director or
executive officer of the Company. Additionally, there are no transactions
between Mr. Harbaugh that would be required to be reported under Item 404(a) of
Regulation S-K.
In connection with the appointment of Mr. Harbaugh as Executive Vice President,
Chief Financial Officer, Mr. Asarpota ceased to be an officer of the Company as
of December 31, 2019. Mr. Asarpota agreed to remain with the Company in an
advisory role through May 1, 2020 (the "Termination Date") to assist with the
transition of responsibilities and entered into a letter agreement, dated
December 31, 2019, with the Company with respect thereto. Through the
Termination Date, Mr. Asarpota will continue to be paid salary at his current
rate and remain eligible for all company health, welfare and other benefits,
including a bonus payment with respect to his service as Chief Financial Officer
during the year ended December 31, 2019. Following the Termination Date, in
accordance with the Company's Amended and Restated Executive Severance Plan,
Mr. Asarpota will be eligible to receive, in exchange for a general release of
claims against the Company, the payment of (i) 12 months of annual base salary,
(ii) a pro-rated annual performance bonus for the year ended December 31, 2020,
payable in March 2021 at the lesser of target or actual performance, (iii) an
amount equal to the after-tax cost of health benefits for a period of 12 months,
and (iv) outplacement services. Mr. Asarpota also agreed to provide consulting
services to the Company for a period of four months following the Termination
Date. Mr. Asarpota and the Company entered into a general consulting and
services agreement, dated December 31, 2019, pursuant to which Mr. Asarpota
agreed to provide consulting services for the period May 2, 2020 through
September 2, 2020, for which he will receive monthly compensation of $1,000 and
continued vesting of his outstanding LTI awards during such period.
Item 7.01 Regulation FD Disclosure.
In the Press Release issued on January 2, 2020, the Company also reaffirmed its
annual financial guidance for the full-year 2019. A copy of the Press Release is
furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information contained in this Current Report on Form 8-K pursuant to Item
7.01 (Regulation FD Disclosure) and the Exhibit hereto shall not be deemed
"filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or incorporated by reference in any filing under
the Securities Act of 1933, as amended, or the Exchange Act, except as shall be
expressly set forth by specific reference in such a filing.
--------------------------------------------------------------------------------
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
99.1 Press release issued by NuVasive, Inc. on January 2, 2020.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses