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PDL BioPharma, Inc. (NASDAQ:PDLI) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

PDL BioPharma, Inc. (NASDAQ:PDLI) 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 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.

2017 Base Pay
On March 4, 2017, the Board of Directors (the Board) of PDL
BioPharma, Inc. (the “Company”) approved and ratified the
decisions of the Compensation Committee (the “Compensation
Committee”) of the Board with respect to its recommendations of
the base salary to the Companys management. The following base
salary increases (decreases) for each of the named executive
officers as set forth in the chart below:
Name
Title
2017 Base Salary
% Increase (Decrease) from 2016 Base Salary
John P. McLaughlin
President and Chief Executive Officer
$700,057
(12)%
Christopher Stone
Vice President, General Counsel and Secretary
$460,350
0%
Peter Garcia
Vice President and Chief Financial Officer
$430,301
0%
Danny Hart
Vice President, Business Development
$381,924
0%
Steffen Pietzke
Vice President, Finance and Chief Accounting Officer
$316,004
18%
2017 Annual Bonus Plan
On March 4, 2017, the Board approved and ratified the decision of
the Compensation Committee regarding a cash bonus plan covering
the named executive officers for fiscal year 2017 (the “2017
Annual Bonus Plan”). Under the 2017 Annual Bonus Plan, each of
the Companys named executive officers is eligible to receive cash
bonuses upon on the achievement by the Company of the
Compensation Committee-designated threshold goal of consummating
corporate transactions resulting in the acquisition of income
generating assets of an amount specified in the 2017 Annual Bonus
Plan.
The amount of the bonuses paid under the 2017 Annual Bonus Plan
will be determined by the Compensation Committee after evaluating
(i) certain specified corporate and individual goals adopted by
the Compensation Committee and set forth in the 2017 Annual Bonus
Plan and (ii) other individual or corporate performance metrics
that the Compensation Committee may consider in its sole
discretion. The corporate and individual performance
determinations are then weighted for each named executive
officer. The Compensation Committee shall have the discretion to
award amounts equal to or less than (but not greater than) the
maximum awards permitted under the 2017 Annual Bonus Plan.
The target bonus percentages and the maximum bonus percentage of
the named executive officers annual base salary compensation and
the weighting of corporate and individual goals that will be used
to determine each of our named executive officers fiscal year
2017 bonuses are set forth in the chart below:
Name
Title
Target Bonus
Maximum Bonus
Ratio of 2017 Corporate Goals/2017 Individual Goals
John P. McLaughlin
President and Chief Executive Officer
50%
200%
50%/0%
Christopher L. Stone
Vice President, General Counsel and Secretary
75%
150%
75%/25%
Peter Garcia
Vice President and Chief Financial Officer
75%
150%
75%/25%
Danny Hart
Vice President, Business Development
75%
150%
75%/25%
Steffen Pietzke
Vice President, Finance and Chief Accounting Officer
65%
130%
60%/40%
2017/2021 Long-Term Incentive Plan
On March 4, 2017, the Board approved and ratified the decision of
the Compensation Committee regarding a long-term incentive plan
to compensate, retain and incentivize its executive officers (the
“2017/21 LTIP”). The Compensation Committee designated the
effective date of the 2017/21 LTIP as January 1, 2017.
Under the 2017/21 LTIP, each executive officer is eligible for
awards consisting of restricted stock and cash payments (the
“Awards”) upon the attainment of specified performance goals
related to (i) the amount of income generating asset acquisitions
accomplished and (ii) the Companys cash flows from income
generating assets. The Compensation Committee fashioned the
2017/21 LTIP so that all awards under the plan are at risk if
certain performance criteria are not met.
Each executive officers restricted stock award was granted on
March 2, 2017, and the number of shares underlying the restricted
stock award was determined based on the closing price of the
Companys common stock on March 2, 2017, which was $2.04 per share
(rounded to the nearest whole share).
Subject to the acceleration provisions set forth in the severance
agreements of the executive officers (disclosed on May 26, 2011),
portions of the Awards will vest in December of 2018 through
2021, provided the executive officer remains employed by the
Company through such date and the specified performance criteria
have been accomplished as set forth in the chart below:
Date
Performance Criteria
Percent of the Awards Vesting
December 2018
Acquire, in the aggregate during years 1 and 2 at least
$200 million of specialty pharma assets
50%
December 2019
Maintain cash flows at 75% or greater of forecasted
cash flows for such specialty pharma assets in year 3
16.6%
December 2020
Maintain cash flows at 75% or greater of forecasted
cash flows for such specialty pharma assets in year 4
16.6%
December 2021
Maintain cash flows at 75% or greater of forecasted
cash flows for such specialty pharma assets in year 5
16.6%
In determining the awards in years 3, 4 and 5 of the 2017/21
LTIP, the Compensation will look at the actual percentage of cash
flows at or above 75% of the amount forecasted, and the amounts
awarded will be proportional to the percentage of cash flows
received in such year. For example, if the Company receives 75%
of the forecasted cash flows in such year, the awards will be 75%
of the 16.6% of the restricted stock that vests in such year; if
the Company receives 90% of the forecasted cash flows in such
year, the awards will be approximately 90% of the 16.6% of
restricted stock that vests in such year. In the event that the
performance criteria are not met in any of years three through
five but at the conclusion of the 2017/21 LTIP the combination of
the three years results in maintenance of cash flows at 75% or
greater than forecasted cash flows for the three-year period,
then any Awards that did not vest during the three-year period
shall vest and pay. Dividend payments and other distributions
made on the restricted stock during the vesting period of the
restricted stock will accrue through the vesting period and will
be paid, plus interest, to the executive officer upon vesting of
the restricted stock award.
The target Awards for certain officers are set forth in the chart
below:
Name
Title
Total Target Cash Payment
Total Target Value of Restricted Stock Award
Number of Shares Underlying Restricted Stock Award
John P. McLaughlin
President and Chief Executive Officer
$1,800,000
$1,200,000
588,235
Christopher L. Stone
Vice President, General Counsel and Secretary
$655,980
$437,320
214,372
Peter Garcia
Vice President and Chief Financial Officer
$650,768
$433,845
212,669
Danny Hart
Vice President, Business Development
$609,000
$406,000
199,019
Steffen Pietzke
Vice President, Finance and Chief Accounting Officer
$300,000
$200,000
98,039
>

About PDL BioPharma, Inc. (NASDAQ:PDLI)
PDL BioPharma, Inc., formerly Protein Design Labs, Inc., manages a portfolio of patents and royalty assets, consisting of its Queen et al. patents, license agreements with various biotechnology and pharmaceutical companies, and royalty and other assets acquired. The Company provides non-dilutive growth capital and financing solutions to late-stage public and private healthcare companies and offers immediate financial monetization of royalty streams to companies, academic institutions and inventors. It evaluates its investments based on the quality of the income generating assets and potential returns on investment. It is focused on intellectual property asset management, acquiring income generating assets and maximizing value for its stockholders, among others. It receives royalties on sales of over ten humanized antibody products, which include Avastin, Herceptin, Xolair, Kadcyla, Tysabri, Actemra, Gazyva and Entyvio all of which are approved for use. PDL BioPharma, Inc. (NASDAQ:PDLI) Recent Trading Information
PDL BioPharma, Inc. (NASDAQ:PDLI) closed its last trading session up +0.01 at 2.15 with 1,056,485 shares trading hands.

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