| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
On October 19, 2023, Catalyst Pharmaceuticals, Inc. (the “Company”) announced the appointment of Richard J. Daly, 62, as its Chief Executive Officer (“CEO”), to become effective on January 1, 2024. The Company’s current CEO, Patrick J. McEnany, will continue to serve as the Company’s CEO until December 31, 2023 and, following his retirement as the Company’s CEO, will continue to serve on the Company’s Board of Directors (“Board”) as the non-executive Chairman of the Board. Mr. Daly, who has been a member of the Company’s Board since February 2015, will remain a member of the Board following his becoming CEO of the Company.
Mr. Daly has previously held distinguished positions in multinational corporations and at innovative biotech companies. Most recently, since January 2022, Mr. Daly has served as President of CARsgen Therapeutics Corporation. Prior to joining CARsgen, Mr. Daly served as Chief Operating Officer at Beyond Springs Inc. (from 2018 to 2022) and as CEO, President, and Chairman of Neuralstem, Inc., a publicly held biotechnology company specializing in central nervous system therapies based on neuronal stem cell technology (from 2016 to 2018).
Throughout his career, Mr. Daly has also held prominent leadership positions at leading global pharmaceutical companies, including serving as President of AstraZeneca’s U.S. diabetes subsidiary, leading all commercial and medical plans and objectives for a $1.2 billion revenue, 3,000-employee division, and the successful launch of an orphan rare disorder drug, Myalept, for the treatment of Lipodystrophy. Earlier, Mr. Daly served at Takeda and TAP Pharmaceuticals, a joint venture established between Takeda and Abbott Laboratories, where he held several senior leadership positions, including the Executive Vice President at Takeda Pharmaceutical North America and the Senior Vice President of Marketing at TAP Pharmaceuticals. He holds an MBA from the Kellogg School of Management at Northwestern University and a Bachelor of Science in Microbiology from the University of Notre Dame.
In connection with his appointment as the Company’s CEO, the Company’s Board of Directors has agreed that effective on his becoming CEO, Mr. Daly will receive the following as his compensation for his services as the Company’s CEO:
| | • | | An annual base salary of $750,000, with eligibility for annual increases to base salary in subsequent years if such increases are approved by the Compensation Committee of the Board of Directors. |
| | • | | A cash bonus of up to 75% of his base salary based upon individual and Company performance metrics to be determined annually by the Compensation Committee of the Board of Directors. |
Additionally, at a Board meeting held on October 18, 2023, Mr. Daly was granted (i) seven-year stock options to purchase 1,365,319 shares of the Company’s common stock at an exercise price of $13.30 per share (the closing price of the Company’s common stock on the date of grant), and (ii) 210,526 restricted stock units. The stock options and restricted stock units will vest in five equal annual installments, with the first installment vesting on January 1, 2025 and each year thereafter on the same date. Further, upon becoming the Company’s CEO, Mr. Daly will be designated as an executive officer and will be entitled to the benefits contained in the Company’s Executive Severance and Change in Control Plan, which provides certain benefits to designated employees in the event that they are terminated without “Cause” (as defined in that plan), if they were to terminate their employment with the Company for “Good Reason” (as defined in that plan), or in the event of a “Change in Control” (as defined in that plan).
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