Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangement of Certain Officers
Appointment of Officers
On April 3, 2023, the Board of Directors (the "Board") of Neoleukin
Therapeutics, Inc. (the "Company") appointed (a) Donna M. Cochener as the
Company's Interim Chief Executive Officer and designated her as the Company's
principal executive officer and (b) Sean Smith as the Company's Interim Chief
Financial Officer and designated him as the Company's principal financial
officer (the "Executive Officer Appointments"), each effective as of March 31,
2023 ("the Effective Date"). The Executive Officer Appointments occurred in
connection with Dr. Jonathan Drachman, M.D.'s resignation from his role as
President, Chief Executive Officer, principal executive and financial officer
and director of the Company as of the Effective Date, as previously announced on
March 6, 2023.
Prior to her appointment as the Company's Interim Chief Executive Officer and
designation as the Company's principal executive officer, Ms. Cochener, age 48,
served as the Company's General Counsel, Senior Vice President Legal since March
2022. Before joining the Company, Ms. Cochener was Senior Vice President, Deputy
General Counsel of HomeStreet, Inc., a financial services holding company, and
its wholly owned subsidiary, HomeStreet Bank, from February 2016 to November
2021. Prior to joining HomeStreet Bank, Ms. Cochener was a Partner at Davis
Wright Tremaine, LLP, a law firm, in Seattle, Washington. She has also served as
Chairman of the Board of Cochener Garvey Capital Partners, Inc. and its
affiliated subsidiaries since August 2012. Ms. Cochener received a Bachelor of
Science in Journalism from Northwestern University and a Juris Doctorate and
Masters of Law in International Comparative Law from Duke University.
Prior to his appointment as the Company's Interim Chief Financial Officer and
designation as the Company's principal financial officer, Mr. Smith, age 37,
served as the Company's Vice President, Finance and principal accounting officer
since February 2022, and previously served as its Controller from October 2019
to February 2022. From April 2017 to August 2019, Mr. Smith was at Aptevo
Therapeutics Inc., a biotechnology company, where he served as Senior Manager,
Accounting, and most recently as the Director of Accounting. Prior to that, Mr.
Smith held various accounting, auditing, and financial reporting leadership
roles at a public company within the telecommunications industry and at KPMG.
Mr. Smith holds a Bachelor of Science in Accounting and a Master of Science in
Accounting, both from the University of North Texas, and a Master of Business
Administration from the University of Washington. Mr. Smith is also a Certified
Public Accountant.
Ms. Cochener and Mr. Smith have existing employment agreements with the Company
in their prior executive roles (the "Existing Employment Agreements"). In
connection with the appointment of Ms. Cochener as Interim Chief Executive
Officer and Mr. Smith as Interim Chief Financial Officer, the Company has
entered into amendments to the Existing Employment Agreements dated as of April
3, 2023 and effective March 31, 2023 (the "Employment Agreement Amendments" and
together with the Existing Employment Agreements, the "Employment Agreements").
The Employment Agreement Amendments provide that Mr. Smith shall be paid an
initial base salary of $410,000 for his role as Interim Chief Financial Officer
and Ms. Cochener shall be paid an initial base salary of $450,000 for her role
as Interim Chief Executive Officer. Each of Ms. Cochener and Mr. Smith shall be
entitled to (a) an annual bonus for 2023, which replaces the annual bonus
described in the Existing Employment Agreement, of not less than $159,167 for
Mr. Smith and $219,375 for Ms. Cochener, which will be prorated in the event
such executive is terminated without Cause or resigns for Good Reason, as those
terms are defined in the Employment Agreements, prior to December 31, 2023 (b) a
retention bonus of $159,167 for Mr. Smith and $219,375 for Ms. Cochener, payable
upon (i) a Change of Control, as that term is defined the Employment Agreement
Amendment, (ii) termination by the Company without Cause or resignation by the
executive for Good Reason or (iii) December 31, 2023,; provided that the
executive has remained in his or her role through the triggering event for such
payment. In the event the executive is terminated without Cause or resigns for
Good Reason outside of a Change in Control, the executive would be entitled to
receive a separation payment equivalent to 9 months of salary, payable as salary
continuation, as well as 9 months of COBRA benefits for the executive and his or
her family. In the event of a termination without Cause or resignation with Good
Reason within six months prior to or twelve months following a Change in
Control, the executive would be entitled to receive a lump sum payment equal to
(a) 15 months of the executive's base salary, (b) 125% of the executive's annual
bonus amount (c) 15 months of COBRA coverage for the executive and his or her
family (d) acceleration of all outstanding equity awards and (e) an extension of
the post-separation exercise period of such executives stock options to 15
months after separation; provided, that in the event the termination or
resignation preceded the Change in Control, such Change in Control occurs by
March 1 of the following year. All severance payments would be conditioned on
receipt of a standard release of claims from the executive at the time of
separation.
The foregoing summary of the Employment Agreements and Employment Agreement
Amendments does not purport to be complete and is subject to, and qualified in
its entirety by, the Existing Employment Agreements and Employment Agreement
Amendments. Ms. Cochener's Existing Employment Agreement is filed as Exhibit
10.19 to the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2022; Mr. Smith's Existing Employment Agreement and each of the
Employment Agreement Amendments will be filed as exhibits to the Company's
Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2023.
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Separation Agreement with Dr. Priti Patel
On March 31, 2023, Dr. Patel, the Company's Chief Medical Officer, and the
Company entered into a Separation Agreement and Release (the "Separation
Agreement") effective March 31, 2023 (the "Separation Date"), pursuant to which,
if the Separation Agreement becomes effective pursuant to its terms, Dr. Patel
will receive (a) cash severance payments equivalent to her base salary on the
Separation Date for 9 months following the Separation Date in the form of salary
continuation payments, payable in accordance with the Company's standard payroll
practices, (b) premium payments for continued healthcare coverage for 9 months
following the Separation Date, (c) a lump-sum retention payment equivalent to
50% of Dr. Patel's salary earned during fiscal year 2023 through the Separation
Date, (d) accelerated vesting of 100,000 shares of the option grant awarded to
Dr. Patel on August 2, 2022 (the "August 2022 Grant"), such that 100,000 shares
of the August 2022 Grant shall be fully vested and exercisable on the Separation
Date, (e) accelerated vesting and issuance of the unvested shares underlying a
Restricted Stock Unit granted to Dr. Patel in April 2021 which would have vested
on April 30, 2023 had Dr. Patel continued to be employed by the Company through
that date and (f) an extension of the post-termination exercise period in which
Dr. Patel may exercise the vested and exercisable shares pursuant to the August
2022 Grant for 12 months following the Separation Date.
The foregoing summary of the Separation Agreement does not purport to be
complete and is subject to, and qualified in its entirety by, the Separation
Agreement, which will be filed as an exhibit to the Company's Quarterly Report
on Form 10-Q for the fiscal quarter ended March 31, 2023.
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