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For purposes of his letter agreement, "Good Reason" means, following notice to us and our failure to cure such condition after thirty days receipt of such notice,
Mr. Morris' resignation within 12 months after:
- a change that materially reduces his duties, position, level of authority, or responsibility or changing reporting
obligation to someone other than our Chief Executive Officer unless that change in reporting structure is due to a change in control;
- a material reduction in his base salary;
- receipt of notice that his principal workplace will be relocated by more than 50 miles; or
- our material failure to comply
with our obligations under his letter agreement.
Letter Agreement with New Chief Business Officer
In May 2014, we entered into a letter agreement with Arthur Fratamico, our new chief business officer. Pursuant to his letter
agreement, Mr. Fratamico's starting base salary is $300,000, and he will be eligible for an annual performance bonus equal to 35% of his base salary, prorated for our fiscal year ending
December 31, 2014, based on his start date. Such bonus will be payable in cash, stock or a combination and will be earned based on the achievement of individual and corporate objectives.
addition, pursuant to his letter agreement, Mr. Fratamico was granted an option to purchase 3,500,000 shares of our common stock which will vest over four years of continuous
service provided by him, with 25% vesting after his completion of 12 months of continuous service and the remainder vesting in equal monthly installments over an additional three years of
Mr. Fratamico is terminated by us for any reason other than for cause, or if he resigns for certain good reasons, we will provide him with six monthly payments at his
then-current base salary, provided that he continues to fulfill the terms of his proprietary information and inventions agreement with us and timely executes and allows to become effective a release
of claims against us.
and "Good Reason" have the same definitions as with respect to Mr. Morris above.
2014 Equity Incentive Plan
General. Our board of directors adopted our 2014 Equity Incentive Plan, or 2014 Plan, in July 2014, and we expect our stockholders
the 2014 Plan prior to the completion of this offering. The 2014 Plan became effective immediately on adoption although no awards will be made under it until the effective date of the registration
statement of which this prospectus is a part. Our 2014 Plan will replace our 2013 Plan (described below), and no further grants will be made under such plan following this offering. However, awards
outstanding under our 2013 Plan, as well as awards outstanding under our 2004 Plan and our 2001 Plan (each as described below), will continue to be governed by their existing terms.
Share Reserve. The number of shares of our common stock available for issuance under our 2014 Plan will equal the sum
of shares plus
up to shares remaining available for issuance under, or issued pursuant to or subject to awards granted under, our 2013 Plan. The number of shares reserved
for issuance under the 2014
Plan will be increased automatically on the first business day of each of our fiscal years, commencing in 2015, by a number equal to the smallest of:
- % of the shares of common stock outstanding on the last business day of the prior fiscal year; or
- the number of shares determined by our board of directors.
general, to the extent that any awards under the 2014 Plan are forfeited, terminate, expire or lapse without the issuance of shares, or if we repurchase the shares subject to awards
granted under the 2014 Plan, those shares will again become available for issuance under the 2014 Plan, as will shares applied to