AYTU BIOSCIENCE, INC. (OTCMKTS:AYTU) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02.
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Departure of Directors or Certain Officers; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On April 14, 2017, we entered into an employment agreement with
each of Joshua R. Disbrow and Jarrett T. Disbrow, each effective
April 16, 2017. The agreements are identical, except for the
positon that each executive is to occupy, and are identical to
the two-year employment agreements entered into effective April
16, 2015. Joshua Disbrow is currently our Chief Executive Officer
and Jarrett Disbrow is currently our Chief Operating Officer.
Each will occupy the same position during the term of his
respective agreement, and Joshua Disbrow will also serve as our
Chairman of the Board during the term of his agreement.
Each agreement is for a term of 24 months beginning on April 16,
2017, subject to termination by us with or without Cause (as
defined below) or as a result of the officers disability, or by
the officer with or without Good Reason (as defined below). Each
officer is entitled to receive $250,000 in annual salary, plus a
discretionary performance bonus with a target of 125% of his base
salary, based on the officers individual achievements and company
performance objectives established by the board or the
compensation committee in consultation with the officer. Each
officer is also eligible to participate in the benefit plans
maintained by us from time to time, subject to the terms and
conditions of such plans.
We agreed to issue each officer on or promptly after August 1,
2017 stock options to purchase shares of our common stock in an
amount agreed upon by us and the officer, but not less than the
highest amount of options issued to any other employee of our
company during the term. The exercise price will be the last sale
price of our common stock as reported during the period
immediately preceding the date of grant, and in accordance with
our 2015 Stock Option and Incentive Plan, and will vest as
follows: 50% will vest on the date of grant; 25% will vest 365
days after the date of grant; and 25% will vest 730 days after
the date of grant. All such options will vest in full upon a
Change in Control (as defined below), death, disability, or
termination with or without Cause or for Good Reason.
In the event either officers employment is terminated without
Cause by us or either officer terminates his employment with Good
Reason, we will be obligated to pay him any accrued compensation
and a lump sum payment equal to two times his base salary in
effect at the date of termination, as well as continued
participation in our health and welfare plans for up to two
years. All vested stock options will remain exercisable from the
date of termination until the expiration date of the applicable
award. So long as a Change in Control is not in effect, then all
options which are unvested at the date of termination without
Cause or for Good Reason shall be accelerated as of the date of
termination such that the number of option shares equal to
1/24th the number of option shares multiplied by the
number of full months of the officers employment will be deemed
vested and immediately exercisable by the officer. Any unvested
options over and above the foregoing shall be cancelled and of no
further force or effect, and will not be exercisable by the
officer.
Good Reason means, without the officers written consent, there
is:
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a material reduction of the level of the officers compensation (excluding any bonuses) (except where there is a general reduction applicable to the management team generally, provided, however, that in no case may the base salary be reduced below $250,000); |
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a material reduction in the officers overall responsibilities or authority, or scope of duties (it being understood that the occurrence of a Change in Control shall not, by itself, necessarily constitute a reduction in the officers responsibilities or authority); or |
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a material change in the principal geographic location at which the officer must perform his services (it being understood that the relocation to a facility or a location within 40 miles of the State Capitol Building in Denver, Colorado will not be deemed material). |
Cause means:
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willful malfeasance or willful misconduct by the officer in connection with his employment; |
| gross negligence in performing any of his duties; |
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conviction of, or entry of a plea of guilty to, or entry of a plea of nolo contendere with respect to, any crime, other than a traffic violation which is a misdemeanor; |
| willful and deliberate violation of any of our policies; |
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unintended but material breach of any written policy applicable to all employees adopted by us which is not cured to the reasonable satisfaction of the board within 30 days of notice; |
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unauthorized use or disclosure of any of our proprietary information or trade secrets or that of any other party as to which the officer owes an obligation of nondisclosure as a result of the officers relationship with us; |
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willful and deliberate breach of his obligations under the employment agreement; or |
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any other material breach by officer of any of his obligations which is not cured to the reasonable satisfaction of the board within 30 days of notice. |
The severance benefits described above are contingent on each
officer executing a general release of claims.
In the event of a Change in Control, all stock options,
restricted stock and other stock-based grants granted or may be
granted in the future by us to the officers will immediately vest
and become exercisable and all restrictions thereon will lapse.
Change in Control means the occurrence of any of the following
events:
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the acquisition by any individual, entity, or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the Exchange Act)) (the Acquiring Person), other than our company, or any of our subsidiaries, of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the combined voting power or economic interests of our then outstanding voting securities entitled to vote generally in the election of directors (excluding any issuance of securities by us in a transaction or series of transactions made principally for bona fide equity financing purposes); or |
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the acquisition of our company by another entity by means of any transaction or series of related transactions to which we are party (including, without limitation, any stock acquisition, reorganization, merger or consolidation but excluding any issuance of securities by us in a transaction or series of transactions made principally for bona fide equity financing purposes) other than a transaction or series of related transactions in which the holders of our voting securities outstanding immediately prior to such transaction or series of related transactions retain, immediately after such transaction or series of related transactions, as a result of shares in us held by such holders prior to such transaction or series of related transactions, at least a majority of the total voting power represented by our outstanding voting securities or such other surviving or resulting entity (or if we or such other surviving or resulting entity is a wholly-owned subsidiary immediately following such acquisition, its parent); or |
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the sale or other disposition of all or substantially all of our assets in one transaction or series of related transactions. |
The employment agreements are filed as Exhibits 10.1 and 10.2 to
this Report and are incorporated herein by reference. The
foregoing description of the employment agreements is not
complete and is qualified in its entirety by reference to
Exhibits 10.1 and 10.2.
| Item9.01. |
Financial Statements and Exhibits. |
| (d) | Exhibits |
| Exhibit No. | Description |
| 10.1 |
Employment Agreement, effective as of April 16, 2017, between Aytu BioScience, Inc. and Joshua R. Disbrow. |
| 10.2 |
Employment Agreement, effective as of April 16, 2017, between Aytu BioScience, Inc. and Jarrett T. Disbrow. |
About AYTU BIOSCIENCE, INC. (OTCMKTS:AYTU)
Aytu BioScience, Inc. is a commercial-stage healthcare company focused on acquiring, developing and commercializing products in the field of urology. The Company focuses on hypogonadism, prostate cancer, urinary tract infections and male infertility. The Company markets ProstaScint (capromab pendetide), a radio imaging agent indicated to detect the prostate specific membrane antigen (PSMA) in the assessment and staging of prostate cancer. The Company also markets Primsol (trimethoprim hydrochloride), a trimethoprim-only oral solution for urinary tract infections. The Company’s pipeline includes MiOXSYS, an in vitro diagnostic device. MiOXSYS system is a point-of-care semen analysis system, used for diagnosis and management of male infertility. The Company holds the United States rights to Natesto (testosterone), a formulation of testosterone delivered through a nasal gel. Natesto is used for the treatment of hypogonadism (low testosterone) in men. AYTU BIOSCIENCE, INC. (OTCMKTS:AYTU) Recent Trading Information
AYTU BIOSCIENCE, INC. (OTCMKTS:AYTU) closed its last trading session down -0.060 at 0.720 with 26,624 shares trading hands.
