| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
New Chief Financial Officer
On May 11, 2021, Catalent, Inc. (“Catalent” and, together with its subsidiaries, the “Company”) announced that its board had appointed Thomas P. Castellano as Senior Vice President and Chief Financial Officer, effective June 1, 2021 (the “Effective Date”), succeeding Wetteny Joseph, who will be leaving the Company in order to become the Chief Financial Officer of Zoetis Inc. Mr. Joseph’s departure is not due to any disagreement with any of Catalent, its board of directors, or its management, and he will not be entitled to receive any payment in connection with his departure other than as set forth in his existing offer letter.
Mr. Castellano, 41, currently serves as the Company’s Global Vice President of Operational Finance, providing finance partnership on strategic execution across the Company’s business units, and as a member of its Executive Leadership Team. He joined the Company as Director for Financial Planning & Analysis in 2008, playing an integral role in Catalent’s successful initial public offering in 2014, and has served in successively senior positions since then, including as Vice President, Financial Planning & Analysis from 2012 until 2016 and Vice President, Finance, Investor Relations, and Treasurer from 2016 until 2020. Prior to joining the Company, he worked with the capital markets finance group at Lehman Brothers, holding roles of increasing responsibility. Mr. Castellano began his career at Cendant Corporation as part of its financial leadership development program. He holds a bachelor’s degree in finance and an MBA, both from Seton Hall University.
There is no arrangement or understanding between Mr. Castellano and any other person pursuant to which he was selected as CFO. There is also no family relationship between Mr. Castellano and any director or executive officer of Catalent, and he has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
The Company has entered into an offer letter, dated May 10, 2021, with Mr. Castellano (the “Offer Letter”). The terms of his existing severance agreement with the Company, which provides for terms applicable to all senior executives other than Catalent’s Chief Executive Officer and is substantially in the form (the “Form Severance Agreement”) provided as Exhibit 10.3 to the Annual Report on Form 10-K filed September 17, 2010 by Catalent’s wholly owned subsidiary, Catalent Pharma Solutions, Inc. (the “CPS Form 10-K”), shall remain unchanged. The terms of the Offer Letter and the Form Severance Agreement are summarized as follows:
Base Salary. Mr. Castellano’s annual base salary will rise to $500,000, effective on the Effective Date.
Bonus. Mr. Castellano will remain eligible for a cash bonus under the terms of the Company’s Management Incentive Plan, or MIP, the incentive-based annual cash bonus plan for the Company’s executives, with a target amount of $400,000 beginning with the Company’s 2022 fiscal year on July 1, 2021.
Long-Term Incentive Award. Mr. Castellano will remain eligible to participate in Catalent’s Long-Term Incentive Plan (the “LTIP”), with an annual grant target of $600,000 beginning with the annual grant in respect of the 2022 fiscal year, allocated in the same manner as applies to all members of the Company’s Executive Leadership Team, with 30% granted as stock options, 20% as restricted stock units, and 50% as performance-based restricted stock units (also known as “performance share units”).
Termination of Employment. Under his severance agreement, if Mr. Castellano is involuntarily terminated for any reason (including by him for good reason, as defined in the agreement) other than cause (as defined in the agreement), death or disability, he would be entitled to (i) a severance payment equal to the sum of annual base salary and target annual bonus, payable in equal installments over the one-year period following the date of termination; and (ii) continued participation for up to one year in the Company’s group health plans (to the extent he was receiving such coverage as of the termination date), at the same premium rates as may be charged from time to time to the Company’s U.S. employees generally. In addition, under the LTIP, a termination without cause within 18 months of a change in control would result in Mr. Castellano’s unvested awards becoming fully vested and exercisable.
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