VIVUS, INC. Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On
Cash Bonus Payments and Stock Option Awards for Executive Officers
At the Annual Compensation Meeting, the Compensation Committee authorized and
approved cash bonus payments pursuant to the Company's employee annual
discretionary performance incentive plan for fiscal year 2019 adopted on the
same date (the "Annual Bonus Plan") to certain of the Company's employees,
including executive officers
Executive Officers (1) Cash Bonus Payments Stock Option Awards (2) John P. Amos $ -- 137,500 Mark K. Oki $ -- 32,000 John L. Slebir $ 124,300 32,000 Santosh T. Varghese, M.D. $ 105,336 32,000
(1) Messrs. Amos, Oki and Slebir and
officers in the Company's proxy statement filed with the Securities and
Exchange Commission on April 17, 2019 . At the Annual Compensation Meeting,
the Compensation Committee authorized and approved compensation in connection
with the proposed promotion of Dr. Varghese from his role of Chief Medical
Officer to the role of Senior Vice President, Chief Medical Officer,
contingent upon the approval of the promotion by the Board of Directors. In
connection with this proposed promotion, Dr. Varghese's target bonus will
increase from 40% to 50% of his annual base salary for 2020, contingent upon
the approval of this increase by the Board of Directors.
(2) The shares of common stock subject to each stock option will vest and become
exercisable as follows: (i) 50% of the total number of shares subject to the
stock option will vest and become exercisable over four (4) years, such that
one-fourth (1/4th) of such shares will vest and become exercisable on the one
(1) year anniversary of the date of grant and an additional one forty-eighth
(1/48th) of such shares will vest and become exercisable monthly thereafter
on the anniversary of the date of grant, subject to each such individual
continuing to be a Service Provider (as defined in the Company's 2018 Equity
Incentive Plan) on the relevant vesting dates; and (ii) 50% of the total
number of shares subject to the stock option will vest and become exercisable
upon the achievement of both: (a) the Company having an enterprise value of
$450 million or more and (b) the passage of at least two (2) years from the
date of grant, subject to each such individual continuing to be a Service
Provider upon the achievement of the later of (a) and (b). Each stock option
has an exercise price equal to the closing price reported on the NASDAQ
Global Select Market on the date of grant ($2.21 per share), a 7-year term
from the date of grant and a post-employment exercise period equal to 12
months from the date each such individual ceases to be a Service Provider.
The Compensation Committee, in its sole discretion, authorized and approved the cash bonuses under the Annual Bonus Plan for each of the executive officers. Bonuses were determined based upon: (a) discretionary factors as the Compensation Committee deemed appropriate given the performance of the Company and the individual's contribution to the Company's overall performance in 2019, (b) the individual's base salary, and (c) the individual's target bonus rate.
Increases to Base Salary Compensation for Executive Officers
At the Annual Compensation Meeting, the Compensation Committee conducted its
annual review of the base salaries of the Company's employees, including its
executive officers. The following table sets forth the 2020 base salaries
authorized and approved for each of Messrs. Amos, Oki and Slebir and
Executive Officers (1) 2019 Base Salary 2020 Base Salary (2) John P. Amos $ 545,000 $ 545,000 Mark K. Oki $ 411,000 $ 411,000 John L. Slebir $ 497,200 $ 512,120 Santosh T. Varghese, M.D. $ 438,900 $ 460,700
(1) Messrs. Amos, Oki and Slebir and
officers in the Company's proxy statement filed with the Securities and
Exchange Commission on April 17, 2019 . At the Annual Compensation Meeting,
the Compensation Committee authorized and approved compensation in connection
with the proposed promotion of Dr. Varghese from his role of Chief Medical
Officer to the role of Senior Vice President, Chief Medical Officer,
contingent upon the approval of the Board of Directors. A portion of Dr.
Varghese's 2020 base salary is attributable to this proposed promotion and is
contingent upon the approval of the Board of Directors.
(2) The 2020 base salaries are effective retroactively to
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