AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
On June21, 2017, AVEO Pharmaceuticals, Inc. (the Company) held
its 2017 Annual Meeting of Stockholders (the Annual Meeting). At
the Annual Meeting, the Companys stockholders approved the Second
Amended and Restated 2010 Stock Incentive Plan (the Second
Amended and Restated Incentive Plan), which had previously been
adopted by the Companys Board of Directors (the Board) subject to
stockholder approval.
The following brief description of the Second Amended and
Restated Incentive Plan is qualified in its entirety by reference
to the complete text of the plan, a copy of which is attached
hereto as Exhibit 99.1 and is incorporated herein by reference:
Number of Shares Available for Awards
The number of shares of the Companys common stock available for
issuance under the Second Amended and Restated Incentive Plan is
the sum of (i)11,375,000 shares of common stock plus (ii)the
number of shares of the Companys common stock subject to awards
granted under the 2002 Incentive Plan which expire, terminate or
are otherwise surrendered, cancelled, forfeited or repurchased by
the Company at their original issuance price to a contractual
repurchase right, up to a maximum of 625,000 shares (subject, in
the case of incentive stock options, to any limitations of the
Code). These numbers are subject to adjustment in the event of
changes in capitalization and other similar events.
Under the fungible share counting provision, any award that is
not a full-value award is counted against the number of shares
available for issuance under the Second Amended and Restated
Incentive Plan as one share for each share of common stock
subject to such award, and any award that is a full-value award
is counted as 1.5 shares for each one share of common stock
subject to such full-value award, subject to adjustment in the
event of changes in capitalization and other similar events. A
full-value award is any restricted stock award, restricted stock
unit award, or other stock-based award with a per share price or
per unit purchase price lower than 50% of the fair market value
(as defined under the Second Amended and Restated Incentive Plan)
of the Companys common stock on the date of grant.
All shares of common stock covered by stock appreciation rights
are counted against the number of shares available for grant of
awards under the Second Amended and Restated Incentive Plan.
However, stock appreciation rights that may be settled only in
cash are not so counted, and if the Company grants a stock
appreciation right in tandem with an option for the same number
of shares of the Companys common stock and provides that only one
such award may be exercised, which is referred to as a tandem
SAR, only the shares covered by the option, and not the shares
covered by the tandem SAR, will be so counted, and the expiration
of one in connection with the others exercise will not restore
shares to the Second Amended and Restated Incentive Plan.
Shares covered by awards under the Second Amended and Restated
Incentive Plan that expire or are terminated, surrendered, or
cancelled without having been fully exercised or are forfeited in
whole or in part (including as the result of shares subject to
such award being repurchased by the Company at the original
issuance price to a contractual repurchase right) or that result
in any shares not being issued (including as a result of a stock
appreciation right that was settleable either in cash or in stock
actually being settled in cash) will again be available for the
grant of awards under the Second Amended and Restated Incentive
Plan (subject, in the case of incentive stock options, to any
limitations under the Internal Revenue Code of 1986, as amended,
and any regulations promulgated thereunder (the Code)). To the
extent a share that was subject to an award that was counted as
1.5 shares under the fungible share counting provision is
returned to the Second Amended and Restated Incentive Plan, 1.5
shares will again be available for the grant of awards under the
Second Amended and Restated Incentive Plan. In the case of the
exercise of a stock appreciation right, the number of shares
counted against the shares available under the Second Amended and
Restated Incentive Plan will be the full number of shares subject
to the stock appreciation right multiplied by the percentage of
the stock appreciation right actually exercised, regardless of
the number of
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shares actually used to settle the stock appreciation right upon
exercise, and the shares covered by a tandem SAR will not again
become available for grant upon the expiration or termination of
the tandem SAR.
Shares of common stock that are delivered (either by actual
delivery, attestation, or net exercise) to the Company by a
participant to purchase shares of common stock upon exercise of
an award or to satisfy tax withholding obligations (including
shares retained from the award creating the tax obligation) will
not be added back to the number of shares available for the
future grant of awards under the Second Amended and Restated
Incentive Plan. Shares of common stock that are repurchased by
the Company on the open market using the proceeds from the
exercise of an award will not increase the number of shares
available for the future grant of awards under the Second Amended
and Restated Incentive Plan.
The maximum number of shares of common stock with respect to
which awards may be granted under the Second Amended and Restated
Incentive Plan to any participant is 1,000,000per fiscal year,
subject to adjustment in the event of changes in capitalization
and other similar events. For these purposes, each share of
common stock subject to an award is counted as one share of
common stock (including each share of common stock subject to a
full-value award), and the combination of an option in tandem
with a SAR is treated as a single award.
Types of Awards
The Second Amended and Restated Incentive Plan provides for the
grant of incentive stock options intended to qualify under
Section422 of the Code, nonqualified stock options, stock
appreciation rights, restricted stock, restricted stock units,
and other stock-based and cash-based awards (collectively
Awards).
Certain of the Awards described below are subject to minimum
vesting requirements, as specified below under Minimum Vesting
Requirements.
Incentive Stock Options and Nonqualified Stock Options.
Optionees receive the right to purchase a specified number of
shares of the Companys common stock at a specified option price
and subject to such other terms and conditions as are specified
in connection with the option grant. Options may not be granted
at an exercise price that is less than the fair market value of
the Companys common stock on the date of grant, provided that if
the Board approves the grant of an option with an exercise price
to be determined on a future date, the exercise price will be not
less than 50% of the fair market value of the Companys common
stock on such future date. Options may not be granted for a term
in excess of ten years. The Second Amended and Restated Incentive
Plan permits the following forms of payment of the exercise price
of options: (i)payment by cash, by check or in connection with a
cashless exercise through a broker, (ii)subject to certain
conditions and to the extent provided in the applicable option
agreement or approved by the Board, by delivery of shares of
common stock to the Company, (iii)to the extent provided in an
applicable nonqualified stock option agreement or approved by the
Board, by delivery of a notice of net exercise, (iv)to the extent
provided in the applicable option agreement or approved by the
Board, by any other lawful means, or (v)by any combination of
these forms of payment. No option granted under the Second
Amended and Restated Incentive Plan may contain any provision
entitling the holder thereof to the automatic grant of additional
options in connection with any exercise of the original option,
nor may any option provide for the payment or accrual of dividend
equivalents.
Director Options. The Companys non-employee directors
receive an automatic grant of nonqualified stock options to
purchase 40,000 shares of common stock upon commencement of
service on the Board (the initial grant) and an automatic grant
of nonqualified stock options to purchase an additional 20,000
shares of common stock on the date of each annual meeting (the
annual grant), provided that in the case of annual grants, such
director must (i)be serving as a director immediately prior to
and immediately following the Companys annual meeting and
(ii)have served on the Board for at least six months. Initial
grants and annual grants will (i)have an exercise price equal to
the fair market value of the Companys common stock on the date of
grant, (ii)expire on the earlier of 10 years from the date of
grant or three months following cessation of service on the Board
and (iii)contain such other terms and conditions as the Board
determines. The Second Amended and Restated Incentive Plan
provides that initial grants shall vest in thirty-six equal
monthly installments commencing on the first day of the month
following the date of grant and annual grants shall vest in
twelve equal monthly installments commencing on the first day of
the month following the date of grant (or, in the case of annual
grants, if earlier, on the date that is one business day prior to
the Companys next annual meeting), provided, in either case, that
the individual is still serving on the Board on each
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vesting date. No additional vesting will take place after the
non-employee director ceases to serve as a director. The Board
may provide for accelerated vesting in the case of death,
disability, a Change in Control Event (as defined below),
attainment of mandatory retirement age, or retirement following
at least 10 years of Board service. The Board has the discretion
to provide for different vesting provisions and conditions than
those set forth above, to increase or decrease the number of
shares subject to initial grants and annual grants, and to issue
stock appreciation rights, restricted stock awards or other
stock-based awards in lieu of some or all of such options. Any
such discretionary awards to non-employee directors, however, may
only be granted and administered by a committee, all the members
of which are independent directors as defined by
Section5605(a)(2) of the NASDAQ Marketplace Rules.
Stock Appreciation Rights. A stock appreciation right
(an SAR), is an award entitling the holder, upon exercise, to
receive an amount of the Companys common stock determined in
whole or in part by reference to appreciation, from and after the
date of grant, in the fair market value of a share of the
Companys common stock over the measurement price of the SAR. The
measurement price will not be less than 50% of the fair market
value of the Companys common stock on the date the SAR is
granted; provided that if the Board approves the grant of a SAR
effective as of a future date, the measurement price will be not
be less than 50% of the fair market value of the Companys common
stock on such future date. SARs may not be granted with a term in
excess of 10 years. SARs may be granted independently or in
tandem with an option. When SARs are expressly granted in tandem
with options, (i)the SAR will be exercisable only at such time or
times, and to the extent, that the related option is exercisable
(except to the extent designated by the Board in connection with
a Reorganization Event or Change in Control Event, each as
defined below), (ii)the SAR will terminate and no longer be
exercisable upon termination or exercise of the related option
(except to the extent designated by the Board in connection with
a Reorganization Event or Change in Control Event), except that a
SAR granted with respect to less than the full number of shares
covered by an option will not be reduced until the number of
shares as to which the related option has been exercised or has
terminated exceeds the number of shares not covered by the SAR,
(iii)the option will terminate and no longer be exercisable upon
exercise of the related SAR, and (iv)the SAR will be transferable
only with the related option. No SAR granted under the Second
Amended and Restated Incentive Plan may contain any provision
entitling the holder thereof to the automatic grant of additional
SARs in connection with any exercise of the original SAR, nor may
any SAR provide for the payment or accrual of dividend
equivalents.
Restricted Stock Awards. Restricted stock awards entitle
recipients to acquire shares of the Companys common stock,
subject to the Companys right to repurchase all or part of such
shares at their issue price or other stated or formula price (or
to require forfeiture of such shares if issued at no cost) in the
event that the conditions specified in the applicable award are
not satisfied prior to the end of the applicable restriction
period established for such award. Unless otherwise provided in
the applicable restricted stock award agreement, any dividends
(whether paid in cash, stock or property) declared and paid with
respect to shares of restricted stock will be paid to the
participant only if and when such shares become free from the
restrictions on transferability and forfeitability that apply to
such shares.
Restricted Stock Unit Awards. Restricted stock unit
awards entitle the recipient to receive shares of the Companys
common stock, or cash equal to the fair market value of such
shares, to be delivered at the time such award vests to the terms
and conditions established by the Board. The Board may, in its
discretion, provide that settlement of a restricted stock unit
will be deferred, on a mandatory basis or at the election of the
participant in a manner that complies with Section409A of the
Code. A participant has no voting rights with respect to any
restricted stock units. The Board may, in its sole discretion,
provide that a grant of restricted stock units may provide the
participant with the right to receive an amount equal to any
dividends or other distributions declared and paid on an equal
number of outstanding shares of the Companys common stock;
however, any such dividend equivalents will be subject to the
same restrictions on transfer and forfeitability as the
restricted stock units with respect to which such dividend
equivalents are awarded.
Other Stock-Based Awards. Under the Second Amended and
Restated Incentive Plan, the Board has the right to grant other
awards of shares of the Companys common stock, and other awards
that are valued in whole or in part by reference to, or are
otherwise based on, shares of the Companys common stock or other
property (collectively other stock-based awards), including,
without limitation, awards entitling recipients to receive shares
of the Companys common stock to be delivered in the future. Other
stock-based awards are also available as a form of payment in
settlement of other Awards granted under the Second Amended and
Restated Incentive Plan or as payment in lieu of compensation to
which a participant is otherwise entitled. Other stock-based
awards may be paid
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in shares of the Companys common stock or in cash, as the Board
may determine. Any dividend equivalents awarded in respect of
other stock-based awards will be subject to the same restrictions
on transfer and forfeitability as the other stock-based award
with respect to which such dividend equivalents are awarded.
Cash-Based Awards. The Board may also grant awards
denominated in cash rather than shares of common stock,
(cash-based awards), including performance awards, as described
in further detail below. Any dividend equivalents awarded in
respect of cash-based awards will be subject to the same
restrictions on transfer and forfeitability as the cash-based
award with respect to which such dividend equivalents are
awarded.
Performance Awards. Restricted stock awards, restricted
stock unit awards, other stock-based awards or cash-based awards
under the Second Amended and Restated Incentive Plan may be made
subject to the achievement of performance goals. Such awards are
referred to as performance awards. Performance awards can also
provide for cash payments of up to $1,000,000 per fiscal year per
individual. Performance awards intended to qualify as
performance-based compensation under Section162(m) of the Code
will be made only by a committee (or subcommittee) of the Board
comprised solely of two or more directors eligible to serve on a
committee making awards qualifying as performance-based
compensation under Section162(m) of the Code. For any award
intended to qualify as performance-based compensation, the
committee will specify that the degree of granting, vesting
and/or payout will be subject to the achievement of one or more
objective performance measures established by the committee,
which will be based on the relative or absolute attainment of any
combination of the following:
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the entry into an arrangement or agreement with a third party for the development, commercialization, marketing or distribution of products, services or technologies, or for conducting a research program to discover and develop a product, service or technology, and/or the achievement of milestones under such arrangement or agreement, including events that trigger an obligation or payment right; |
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achievement of domestic and international regulatory milestones, including the submission of filings required to advance products, services and technologies in clinical development and the achievement of approvals by regulatory authorities relating to the commercialization of products, services and technologies; |
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the achievement of discovery, preclinical and clinical stage scientific objectives, discoveries or inventions for products, services and technologies under research and development; |
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the entry into or completion of a phase of clinical development for any product, service or technology, such as the entry into or completion of phase 1, 2 and/or 3 clinical trials; |
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the consummation of debt or equity financing transactions, or acquisitions of business, technologies and assets; |
| new product or service releases; |
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the achievement of qualitative or quantitative performance measures set forth in operating plans approved by the Board from time to time; |
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specified levels of product sales; net income; earnings before or after discontinued operations, interest, taxes, depreciation and/or amortization; operating profit before or after discontinued operations and/or taxes; sales; sales growth; earnings growth; cash flow or cash position; gross margins; stock price; market share; or return on sales, assets, equity or investment; |
| improvement of financial ratings; |
| achievement of balance sheet or income statement objectives; |
| total stockholder return; and/or |
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other comparable measures of financial and operational performance. |
Such goals may reflect, as applicable, absolute entity or
business unit performance or a relative comparison to the
performance of a peer group of entities or other external
measures of the selected performance criteria and may be absolute
in their terms or measured against or in relationship to other
companies comparably, similarly or otherwise
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situated. The committee may specify that such performance
measures will be adjusted to exclude any one or more of
(i)extraordinary items, (ii)gains or losses on the dispositions
of discontinued operations, (iii)the cumulative effects of
changes in accounting principles, (iv)the write-down of any
asset, and (v)charges for restructuring and rationalization
programs.
Such performance measures may vary by participant and may be
different for different awards, may be particular to a
participant or the department, branch, line of business,
subsidiary or other unit in which the participant works and may
cover such period as may be specified by the committee, and will
be set by the committee within the time period prescribed by, and
will otherwise comply with the requirements of, Section162(m) of
the Code. The committee may adjust downwards, but not upwards,
the cash or number of shares payable to such a performance award,
and the committee may not waive the achievement of applicable
performance measures except in the case of death or disability of
the participant or a Change in Control Event.
Awards that are not intended to qualify as performance-based
compensation under Section162(m) of the Code may be based on
these or other performance measures as the Board may determine.
The Company believes that disclosure of any further details
concerning the performance measures for any particular year may
be confidential commercial or business information, the
disclosure of which could adversely affect the Company.
Any dividend equivalents awarded with respect to performance
awards will be subject to the same restrictions on transfer and
forfeitability as the performance awards with respect to which
such dividend equivalents are awarded.
Minimum Vesting Requirements
The Second Amended and Restated Incentive Plan provides that no
option that vests solely based on the passage of time that is
granted to an employee in connection with his or her commencement
of employment will vest earlier than the first anniversary of its
date of grant or the date of commencement of employment,
whichever is earlier. However, the Board, either at the time the
option is granted or at any time thereafter, may allow an option
to accelerate and become vested, in whole or in part, prior to
the first anniversary of its date of grant, in the event of the
death or disability of the participant; the termination of the
participants employment by or service to the Company under
specified circumstances; or a merger, consolidation, sale,
reorganization, recapitalization, or change in control of the
Company.
Awards of restricted stock, restricted stock unit awards, other
stock-based awards and cash-based awards that vest solely based
on the passage of time will be zero percent vested prior to the
first anniversary of the date of grant (or, in the case of awards
to non-employee directors, if earlier, the date of the first
annual meeting held after the date of grant), no more than
one-third vested prior to the second anniversary of the date of
grant (or, in the case of awards to non-employee directors, if
earlier, the date of the second annual meeting held after the
date of grant), and no more than two-thirds vested prior to the
third anniversary of the date of grant (or, in the case of awards
to non-employee directors, if earlier, the date of the third
annual meeting held after the date of grant). Awards of
restricted stock, restricted stock unit awards, other stock-based
awards and cash-based awards that do not vest solely based on the
passage of time (excluding performance awards) will not vest
prior to the first anniversary of the date of grant (or, in the
case of awards to non-employee directors, if earlier, the date of
the first annual meeting held after the date of grant). The
minimum vesting requirements in the two foregoing sentences will
not apply to awards of restricted stock, restricted stock unit
awards, other stock-based awards and cash-based awards granted,
in the aggregate, for up to 10% of the maximum number of
authorized shares for which Awards may be made under the Second
Amended and Restated Incentive Plan. Except as otherwise provided
in the case of performance awards, the Board may, either at the
time an award of restricted stock, a restricted stock unit award,
other stock-based award or cash-based award is made, or at any
time thereafter, waive its right to repurchase shares of common
stock (or waive the forfeiture thereof) or remove or modify the
restrictions applicable to such award, in whole or in part, in
the event of the death or disability of the participant; the
termination of the participants employment by or service to the
Company under specified circumstances; or a merger,
consolidation, sale, reorganization, recapitalization, or change
in control of the Company.
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No more than 50% of the aggregate number of shares of the
Companys common stock underlying performance awards that are made
during any calendar year under the Second Amended and Restated
Incentive Plan will vest prior to the first anniversary of the
date of grant.
Transferability of Awards
Except as the Board may otherwise determine or provide in an
Award, Awards may not be sold, assigned, transferred, pledged or
otherwise encumbered by the person to whom they are granted,
either voluntarily or by operation of law, except by will or the
laws of descent and distribution or, other than in the case of an
incentive stock option, to a qualified domestic relations order.
During the life of the participant, Awards are exercisable only
by the participant.
Eligibility to Receive Awards
All of the Companys employees, officers, and directors, as well
as the Companys consultants and advisors, are eligible to receive
Awards under the Second Amended and Restated Incentive Plan.
However, incentive stock options may only be granted to the
Companys employees, employees of the Companys present or future
parent or subsidiary corporations, and employees of any other
entities the employees of which are eligible to receive incentive
stock options under the Code.
Administration
The Second Amended and Restated Incentive Plan is administered by
the Board. The Board has the authority to grant Awards and to
adopt, amend and repeal the administrative rules, guidelines and
practices relating to the Second Amended and Restated Incentive
Plan that it deems advisable and to construe and interpret the
provisions of the Second Amended and Restated Incentive Plan and
any Award agreements entered into under the Second Amended and
Restated Incentive Plan. The Board may correct any defect, supply
any omission or reconcile any inconsistency in the Second Amended
and Restated Incentive Plan or any Award in the manner and to the
extent it deems expedient and will be the sole and final judge of
such expediency. All decisions by the Board will be made in the
Boards sole discretion and will be final and binding on all
persons having or claiming any interest in the Second Amended and
Restated Incentive Plan or in any Award.
to the terms of the Second Amended and Restated Incentive Plan,
the Board may delegate any or all of its powers under the Second
Amended and Restated Incentive Plan to one or more committees or
subcommittees of the Board. The Board has authorized the Companys
compensation committee to administer certain aspects of the
Second Amended and Restated Incentive Plan, including the
granting of Awards to executive officers, and has authorized a
committee of the Board, consisting of Mr.Bailey, to grant options
to non-executive employees, subject to limitations set by the
compensation committee.
In addition, to the extent permitted by applicable law, the Board
may delegate to one or more of the Companys officers the power to
grant Awards (subject to any limitations under the Second Amended
and Restated Incentive Plan) to the Companys employees or
officers and to exercise such other powers under the Second
Amended and Restated Incentive Plan as the Board may determine.
The Board will fix the terms of any Awards to be granted by such
officers, the maximum number of shares subject to Awards that the
officers may grant, and the time period in which such Awards may
be granted. No officer will be authorized to grant Awards to any
executive officer (as defined by Rule 3b-7 under the Exchange
Act) or to any officer (as defined by Rule 16a-1(f) under the
Exchange Act).
Subject to any applicable limitations contained in the Second
Amended and Restated Incentive Plan (including with respect to
performance awards), the Companys compensation committee
generally selects the recipients of Awards and determines the
following with respect to such Awards (provided that, at times,
the Companys compensation committee recommends to the Board
certain aspects of an Award or Awards for the Boards approval):
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the number of shares of the Companys common stock covered by options and the dates upon which the options become exercisable; |
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the exercise price of options (which may not be less than 50% of the fair market value of the Companys common stock on the date of grant); |
| the duration of options (which may not exceed 10 years); |
| the duration and terms of any cash-based awards; and |
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the number of shares of the Companys common stock subject to any SAR, restricted stock award, restricted stock unit award or other stock-based award and the terms and conditions of such awards, including conditions for repurchase, issue price, measurement price, repurchase price and vesting. |
Each Award under the Second Amended and Restated Incentive Plan
may be made alone or in addition or in relation to any other
Award. The terms of each Award need not be identical, and the
Board need not treat participants uniformly. The Board will
determine the effect on an Award of the disability, death,
termination or other cessation of employment, authorized leave of
absence or other change in the employment or other status of a
participant, and the extent to which, and the period during
which, the participant (or the participants legal representative,
conservator, guardian or designated beneficiary) may exercise
rights under the Award.
In the event of any stock split, reverse stock split, stock
dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in
capitalization or event, or any dividend or distribution to
holders of the Companys common stock, other than an ordinary cash
dividend, the Company is required to make equitable adjustments
(or make substituted awards, as applicable), in the manner
determined by the Board, to (i)the number and class of securities
available under the Second Amended and Restated Incentive Plan,
(ii)the share counting rules and sublimits set forth in the
Second Amended and Restated Incentive Plan, (iii)the number and
class of securities and exercise price per share of each
outstanding option and each option issuable to the Companys
non-employee directors under the Second Amended and Restated
Incentive Plan, (iv)the share- and per-share provisions and the
measurement price of each outstanding SAR, (v)the number of
shares subject to and the repurchase price per share subject to
each outstanding award of restricted stock or restricted stock
unit award, and (vi)the share- and per-share-related provisions
and the purchase price, if any, of each outstanding other
stock-based award.
The Second Amended and Restated Incentive Plan also contains
provisions addressing the consequences of any Reorganization
Event, which is defined as (a)any merger or consolidation of the
Company with or into another entity as a result of which all of
the Companys common stock is converted into or exchanged for the
right to receive cash, securities or other property or is
cancelled, (b)any transfer or disposition of all of the Companys
common stock for cash, securities or other property to a share
exchange or other transaction or (c)the Companys liquidation or
dissolution.
Upon the occurrence of a Reorganization Event, or the Companys
execution of any agreement with respect to a Reorganization
Event, the Board shall provide that all outstanding options be
assumed, or that equivalent options be substituted, by the
acquiring or succeeding corporation (or an affiliate thereof). If
the Reorganization Event also constitutes a Change in Control
Event, except to the extent specifically provided to the contrary
in the applicable option agreement or any other agreement between
the participant and the Company, any assumed or substituted
options held by the Companys employees shall become immediately
exercisable in full if, on or prior to the first anniversary of
the date of the consummation of the Reorganization Event, the
participants employment with the Company or the acquiring or
succeeding corporation is terminated without cause (as defined in
the Second Amended and Restated Incentive Plan). If the acquiring
or succeeding corporation (or an affiliate thereof) in a
Reorganization Event does not agree to assume or substitute for
outstanding options, or in the event of the Companys liquidation
or dissolution, the Board will provide that all unexercised
options will become exercisable in full as of a specified time
prior to the Reorganization Event and will terminate immediately
prior to the consummation of the Reorganization Event, except to
the extent exercised by the participant before the consummation
of the Reorganization Event. If, under the terms of the
Reorganization Event, holders of the Companys common stock
receive a cash payment for each share of common stock surrendered
to the Reorganization Event (the Acquisition Price), the Board
may instead provide that all outstanding options will terminate
upon consummation of the Reorganization Event and that each
participant will receive a cash payment equal to the amount by
which the Acquisition Price multiplied by the number of shares of
common stock subject to such outstanding options exceeds the
aggregate exercise price of such options and any applicable tax
withholdings.
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Upon the occurrence of a Reorganization Event that is not a
Change in Control Event, the Companys repurchase and other rights
with respect to outstanding awards of restricted stock and
restricted stock unit awards will inure to the benefit of the
Companys successor and will apply to the cash, securities or
other property into which the Companys common stock is converted
into or exchanged for to the Reorganization Event in the same
manner and to the same extent as they applied to the Companys
common stock subject to such restricted stock and restricted
stock unit awards.
The Second Amended and Restated Incentive Plan also contains
provisions addressing the consequences of any Change in Control
Event, which is generally defined as (a)the acquisition of
beneficial ownership of the Companys capital stock if, after such
acquisition, the acquirer owns 50% or more of the
then-outstanding shares of the Companys common stock or 50% or
more of the combined voting power of the Companys
then-outstanding securities entitled to vote generally in the
election of the Companys directors, subject to certain
limitations, (b)the consummation of a merger, consolidation,
reorganization, recapitalization or share exchange or a sale or
other disposition of all or substantially all of the Companys
assets, subject to certain limitations, (c)such time as the
Companys continuing directors (as defined under the Second
Amended and Restated Incentive Plan) cease to constitute a
majority of the Board (or, if applicable, the Board of directors
of the Companys successor corporation) or (d)the Companys
liquidation or dissolution.
Upon the occurrence of a Change in Control Event that does not
also constitute a Reorganization Event, except to the extent
specifically provided to the contrary in the applicable option
agreement or any other agreement between a participant and the
Company, each option held by the Companys employees will be
immediately exercisable in full if, on or prior to the first
anniversary of the date of the consummation of the Change in
Control Event, the participants employment with the Company or
the acquiring or succeeding corporation is terminated without
cause (as defined in the Second Amended and Restated Incentive
Plan).
Upon the occurrence of a Change In Control Event (regardless of
whether it is also a Reorganization Event), except to the extent
specifically provided to the contrary in the Award agreement or
any other agreement between a participant and the Company, each
award of restricted stock and each restricted stock unit award
held by the Companys employees will immediately become free from
all conditions or restrictions if, on or prior to the first
anniversary of the date of the consummation of the Change in
Control Event, the participants employment with the Company or
the acquiring or succeeding corporation is terminated without
cause.
The Board may specify in an Award at the time of grant the effect
of a Reorganization Event or Change in Control Event on any SAR
or other stock-based award.
Subject to the minimum vesting requirements described above, the
Board may at any time provide that any Award will become
immediately exercisable in full or in part, free of some or all
restrictions or conditions, or otherwise realizable in full or in
part, as the case may be.
Substitute Awards
In connection with the Companys merger or consolidation with
another entity or the Companys acquisition of property or stock
of another entity, the Board may grant Awards in substitution for
any options or other stock or stock-based awards granted by such
entity or an affiliate thereof. Substitute Awards may be granted
on such terms as the Board deems appropriate in the
circumstances, notwithstanding any limitations on Awards
contained in the Second Amended and Restated Incentive Plan.
Substitute Awards will not count against the Second Amended and
Restated Incentive Plans overall share limit or any sublimit in
the Second Amended and Restated Incentive Plan, except as may be
required by the Code.
Limitations on Repricing
Unless the Companys stockholders approve such action (except as
provided under the Second Amended and Restated Incentive Plan in
connection with a change in capitalization or similar event,
Reorganization Event, or Change in Control Event), the Second
Amended and Restated Incentive Plan provides that the Company may
not:
8
|
amend any outstanding stock option or SAR granted under the Second Amended and Restated Incentive Plan to provide an exercise or measurement price per share that is lower than the then-current exercise or measurement price per share of such outstanding award; |
|
cancel any outstanding option or SAR (whether or not granted under the Second Amended and Restated Incentive Plan) and grant in substitution therefor new Awards under the Second Amended and Restated Incentive Plan (other than as substitute Awards as described above) covering the same or a different number of shares of the Companys common stock and having an exercise or measurement price per share lower than the then-current exercise or measurement price per share of the cancelled award; |
|
cancel in exchange for a cash payment any outstanding option or SAR with an exercise or measurement price per share above the then-current fair market value of the Companys common stock; or |
|
take any other action that constitutes a repricing within the meaning of the rules of the NASDAQ Stock Market. |
Provisions for Foreign Participants
The Board may modify Awards granted under the Second Amended and
Restated Incentive Plan to participants who are foreign nationals
or employed outside the United States or establish subplans or
procedures under the Second Amended and Restated Incentive Plan
to recognize differences in laws, rules, regulations or customs
of such foreign jurisdictions with respect to tax, securities,
currency, employee benefit or other matters.
Amendment or Termination
No Award may be granted under the Second Amended and Restated
Incentive Plan after December31, 2022, but Awards previously
granted may extend beyond that date. The Board may amend, suspend
or terminate the Second Amended and Restated Incentive Plan or
any portion thereof at any time, except that (i)to the extent
required by Section162(m) of the Code, no Award granted to a
participant that is intended to comply with Section162(m) after
the date of such amendment will become exercisable, realizable or
vested, as applicable, unless and until such amendment has been
approved by the Companys stockholders if required by
Section162(m), and (ii)no amendment that would require
stockholder approval under the rules of the NASDAQ Stock Market
may be made effective unless and until such amendment has been
approved by the Companys stockholders. If at any time the
approval of the Companys stockholders is required as to any other
modification or amendment under Section422 of the Code with
respect to incentive stock options, the Board may not effect such
modification or amendment without such approval. Unless otherwise
specified in the amendment, any amendment to the Second Amended
and Restated Incentive Plan will apply to, and be binding on the
holders of, all Awards outstanding under the Second Amended and
Restated Incentive Plan at the time the amendment is adopted,
provided that the Board determines that such amendment, taking
into account any related action, does not materially and
adversely affect the rights of participants under the Second
Amended and Restated Incentive Plan. No Award will be made that
is conditioned upon stockholder approval of any amendment to the
Second Amended and Restated Incentive Plan.
The Board may also amend, modify or terminate any outstanding
Award, including but not limited to, substituting therefor
another Award of the same or a different type, changing the date
of exercise or realization, and converting an incentive stock
option to a nonqualified stock option, subject in each case to
the limitations set forth in the Second Amended and Restated
Incentive Plan with respect to repricings, minimum vesting,
performance awards, and actions requiring stockholder approval.
Such actions will require the approval of the participant, unless
the Board determines that the action, taking into account any
related action, does not materially and adversely affect such
participants rights under the Second Amended and Restated
Incentive Plan or the change is permitted under the Second
Amended and Restated Incentive Plan in connection with a change
in capitalization or similar event, Reorganization Event or
Change in Control Event.
Item5.03. Amendments to Articles of Incorporation or
Bylaws; Change in Fiscal Year.
On June26, 2017, the Company filed a certificate of amendment to
its Restated Certificate of Incorporation (the Certificate of
Amendment) with the Secretary of State of the State of Delaware
to increase the number of
9
authorized shares of the Companys common stock, par value $0.001
per share, from 200,000,000 shares to 250,000,000 shares.
A copy of the Certificate of Amendment is attached as Exhibit 3.1
hereto and is incorporated herein by reference. The foregoing
description of the Certificate of Amendment does not purport to
be complete and is qualified in its entirety by reference to such
exhibit.
Item5.07. Submission of Matters to a Vote of Security
Holders.
At the Annual Meeting, the Companys shareholders voted on the
following proposals:
1. The following nominees were elected to the Companys Board of
Directors for terms expiring at the 2018 annual meeting of
shareholders.
For |
Withheld |
BrokerNon-Votes |
||||||||||
|
|
51,823,278 | 874,609 | 31,044,735 | |||||||||
|
|
44,364,745 | 8,333,142 | 31,044,735 | |||||||||
|
|
51,818,957 | 878,930 | 31,044,735 | |||||||||
|
|
51,816,941 | 880,946 | 31,044,735 |
2. A non-binding, advisory proposal on the compensation of the
Companys named executive officers was approved.
|
|
51,716,387 | |||
|
|
857,651 | |||
|
|
123,849 | |||
|
|
31,044,735 |
3. The shareholdersrecommended, in a non-binding, advisory vote,
that future advisory votes on the compensation of the Companys
named executive officers be held every year.
|
|
50,897,314 | |||
|
|
198,761 | |||
|
|
1,509,210 | |||
|
|
92,602 |
After taking into consideration the foregoing voting results and
the Boards prior recommendation in favor of an annual advisory
shareholder vote on the compensation of the Companys named
executive officers, the Board intends to hold future advisory
votes on the compensation of the Companys named executive
officers every year.
4. The Companys Second Amended and Restated Incentive Plan was
approved.
|
|
51,448,928 | |||
|
|
1,203,889 | |||
|
|
45,070 | |||
|
|
31,044,735 |
5. An amendment to the Companys Restated Certificate of
Incorporation to increase the number of authorized shares of
common stock from 200,000,000 shares to 250,000,000 shares was
approved.
|
|
64,366,940 | |||
|
|
18,222,590 | |||
|
|
1,153,092 |
10
6. An amendment to the Companys Restated Certificate of
Incorporation was approved to effect a reverse stock split of the
Companys common stock, by a ratio of not less than 1-for-3 and
not more than 1-for-15, such ratio and the implementation and
timing of such reverse stock split to be determined in the
discretion of the Board of Directors.
|
|
74,015,270 | |||
|
|
9,528,887 | |||
|
|
198,465 |
7. The appointment of Ernst Young LLP as the independent
registered public accounting firm for the Company for the fiscal
year ending December31, 2017 was ratified.
|
|
81,891,90 | |||
|
|
1,359,290 | |||
|
|
491,431 |
Item9.01. Financial Statements Exhibits.
(d) |
Exhibits |
3.1 |
Certificate of Amendment |
99.1 |
Second Amended and Restated 2010 Stock Incentive Plan |
11
AVEO PHARMACEUTICALS INC ExhibitEX-3.1 2 d368772dex31.htm EX-3.1 EX-3.1 Exhibit 3.1 CERTIFICATE OF AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION OF AVEO PHARMACEUTICALS,…To view the full exhibit click here About AVEO Pharmaceuticals, Inc. (NASDAQ:AVEO)
AVEO Pharmaceuticals, Inc. is a biopharmaceutical company. The Company’s platform delivers insights into cancer and related disease. The Company’s product candidates include Tivozanib, Ficlatuzumab, AV-203 and AV-380. Tivozanib is a selective long half-life vascular endothelial growth factor tyrosine kinase inhibitor (VEGF TKI) that inhibits over three VEGF receptors. Tivozanib is designed to optimize VEGF blockade while minimizing off-target toxicities. Ficlatuzumab is a Hepatocyte Growth Factor (HGF) inhibitory antibody. AV-203 is an anti-ErbB3 monoclonal antibody with ErbB3 affinity. Its preclinical studies suggest that neuregulin1 (NRG1) levels predict AV-203 antitumor activity in preclinical models. AV-380 is a humanized Immunoglobulin G 1 (IgG1) inhibitory monoclonal antibody. AV-380 targets growth differentiating factor 15 (GDF15).
